INCOME TAX (DEDUCTION FOR TRAINING COSTS UNDER SKIM LATIHAN 1MALAYSIA FOR UNEMPLOYED GRADUATES) RULES 2013 [P.U.(A) 260/2013] (The Rules)

The above Rules were gazetted on 5 August 2013 and are deemed to have come into operation on 1 June 2012.

Deduction and amount

In ascertaining adjusted income from a business of a qualifying company for the basis period for a year of assessment, a deduction is allowed for qualifying expenses incurred [as specified in Rule 3(2)] during that period for conducting a training scheme [Rule 3(1)]. The amount of deduction is twice the amount of expenses allowed under the Rules [Rule 3(4)]

Qualifying expenses

The specified expenses allowed are expenditure incurred for each training scheme on –

1. monthly training allowance (of not less than RM1000 paid to trainees for a maximum period of 12 months); 
2. training provided to trainees; 
3. food, travelling and accommodation allowances for trainees under the scheme; 
4. fees paid to trainer engaged to conduct soft-skills training.

The amount allowable for items (b), (c) and (d) for each trainee must not exceed RM5,000 for each training scheme.

Definitions (Rule 2)

Words	Meanings
trainee	An unemployed graduate of (sic) Malaysian citizen who undergoes a training scheme.
training scheme	The Skim Latihan 1Malaysia programme of 8 to 12 continuous months for the unemployed graduates approved by the Economic Planning Unit (EPU) under the Prime Minister’s Department of Malaysia
qualifying company	A company – incorporated in Malaysia under the Companies Act 1965 [Act 125]; and approved by the EPU to participate in the training scheme.

Application (Rule 5)
To claim for deduction under the Rules, the qualifying company shall produce a letter from the EPU specifying that -

1. the training scheme has been approved by EPU where the date of approval begins from 1 June 2012 until 31 December 2016; and 
2. the implementation of the training scheme shall commence within 12 months from the date of approval by EPU.

The Rules can be viewed from the Attorney General’s Chambers website.

You may write to the Institute at technical@ctim.org.my or secretariat@ctim.org.my in respect of any concern or comments you may have on the Rules.