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TaXavvy Issue 37/2020
In this issue:
FAQ on the Special Tax Treatment to Financial Institutions in relation to the Moratorium Granted to Customers
Bank Negara Malaysia (BNM) had on 25 March 2020, announced that financial institutions will offer a deferment of all loan / financing repayments for a period of 6 months (“the moratorium”), with effect from 1 April 2020, to individuals and Small & Medium Enterprises (SME). It is also stated in BNM’s press release that financial institutions will also facilitate requests by corporations to defer or restructure their loans / financing repayments.
Following that, it was announced in the second Economic Stimulus Package on 27 March 2020, that the income of financial institutions from interest or profit on loan / financing facilities under the moratorium would only be taxable when the interest or profit is received after the moratorium period.
Further to that, the Inland Revenue Board (IRB) has now issued a FAQ on the Special Tax Treatment to Financial Institutions in relation to the Moratorium Granted to Customers.
Exemption for private healthcare facilities or services
In the 2018 Budget, it was announced that the application period for medical tourism tax incentive is to be extended for another 3 years. This has now been gazetted in the Income Tax (Exemption) (No. 2) Order 2020 (“Exemption Order”) which is effective from YA 2018.
The Exemption Order covers applications made to MIDA on or after 1 January 2018 but not later than 31 December 2020.
Exemption for religious institution or organisation registered as a company limited by guarantee
In the 2020 Budget, it was announced that the tax exemption is extended to religious institutions / organisations which are registered as companies limited by guarantee. This proposal has now been gazetted in the Income Tax (Exemption) Order 2020 and is effective from the YA 2020.
Labuan developments
Labuan Investment Committee Pronouncement 3-2020
Updated Guidelines on the establishment of Labuan International Commodity Trading Company under the Global Incentives for Trading Programme
Revision of substantial activity requirements for Labuan International Commodity Trading Company under the Global Incentives for Trading Programme
Other Gazette Orders
The following Gazette Orders have been issued recently:
Income Tax (Deduction for Expenses in relation to Secretarial Fee and Tax Filing Fee) Rules 2020
Income Tax (Exemption) (No.3) Order 2020
Stamp Duty (Exemption) Order 2020
Stamp Duty (Exemption) (No 4.) Order 2004 (Amendment) Order 2020
Operational Guideline (GPHDN) 1/2020 - Procedure on Submission of Amended Return Form
The IRB has issued Operational Guideline (GPHDN) 1/2020 - Procedure on Submission of Amended Return Form on 6 March 2020 which replaces GPHDN 4/2019.
Practice Note 1/2020 - Clarification in relation to losses under the Income Tax (Exemption) (No. 3) Order 2018 (“PN 1/2020”)
The IRB has issued PN 1/2020 to outline the treatment of losses from the International Currency Business Unit (ICBU) before and after the Income Tax (Exemption) (No. 3) Order 2018 came into effect.
TaXavvy is a newsletter issued by PricewaterhouseCoopers Taxation Services Sdn Bhd. While every care has been taken in compiling this newsletter, we make no representations or warranty (expressed or implied) about the accuracy, suitability, reliability or completeness of the information for any purpose. PricewaterhouseCoopers Taxation Services Sdn Bhd, its employees and agents accept no liability, and disclaim all responsibility, for the consequences of anyone acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. Recipients should not act upon it without seeking specific professional advice tailored to your circumstances, requirements or needs.
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