Crowe Chat (Special Budget Edition) Part 2

Notification by employer

The notifications for employer’s tax obligations must be made within 30 days to the Inland Revenue Board of Malaysia (IRBM). This includes death cases, whereby the employer is required to notify the IRBM within 30 days after being informed of the death.

Lifestyle relief

The lifestyle relief is reviewed to include a one-off special relief of up to RM2,500 for the purchase of computer, smartphone or tablet from 1 June 2020 to 31 December 2020 whilst the existing lifestyle relief is increased from RM2,500 to RM3,000.

Remit sum imposed

The DGIR is empowered to remit all or part of any sum imposed on any person due to failure to retain and remit part of consideration.

7% retention sum

An executor of the estate of a deceased person who is not a citizen and not a permanent resident is subject to 7% retention sum.

Electronic notification

The DGIR is allowed to issue an electronic notification to the Commissioner of Police or Director of Immigration Department for the purpose of recovery of RPGT due from a person leaving Malaysia.

Taxpayers to pay first

Taxpayers are required to settle the tax payable raised under any assessment within the statutory deadline, notwithstanding the institution of any proceedings under any written law.

Furnishing of RPGT returns electronically

Tax agents, advocates and solicitors are authorised to furnish the RPGT returns on behalf of taxpayers via electronic medium.

Societies

Societies registered under the Societies Act, 1966 are subjected to the same RPGT rates as companies.

Duly stamped instruments

The definition of “duly stamped” instruments is expanded to include an instrument which is stamped by means of digital stamping.

Impressed stamp and digital stamping

Impressed stamp and digital stamping are now legislated as additional modes of payment of stamp duty.

Duplicates and counterparts

Digital stamping on duplicates or counterparts of an instrument is accepted as a means to deem that duplicates and counterparts have been duly stamped.

Penalties denoted on instruments

Any payment of penalties can be denoted on instruments by way of digital stamping and shall be certified by the DGIR.

Recovery of stamp duties

The DGIR and the employees of the IRBM authorised by the DGIR are empowered to recover the stamp duties due to the Government.

Electronic notification

The DGIR is allowed to issue an electronic notification to the Commissioner of Police or Director of Immigration Department for the purpose of recovery of duties, penalties or other sums due from person leaving Malaysia.

Power of Minister

The Minister is empowered to exempt, reduce or remit duties in relation to any instruments, or all instruments in relation to any schemes, which would be chargeable or charged with stamp duty.

Power of DGIR

The DGIR is empowered to remit stamp duties, wholly or partly, on grounds of poverty.

Adjudication fees

The provision of the Stamp Act 1949 has been amended to reflect the current stamping practice of no longer imposing adjudication fees.

Means of digital stamping

The Minister is empowered to prescribe the means of digital stamping for the payment of stamp duty and to provide for the matters relating to the issuance and validity of digital stamping.

Business activity

The Labuan business activity definition is expanded to provide clarity on the substance requirements between a Labuan entity carrying on a Labuan trading activity and a Labuan non-trading activity.

Chargeable profits

The definition of chargeable profits of a Labuan entity is introduced to facilitate the preparation of its tax return.

Extension of time

The DGIR is empowered to allow an extension of time to Labuan entities to make an irrevocable election to be taxed under the ITA.

Appeal

A Labuan entity may appeal against a notice of additional assessment raised.

Settlement of tax

Taxpayers are required to settle the tax payable at the time of furnishing of tax returns to the IRBM.

Legal proceedings

Taxpayers are required to settle the tax payable raised under any assessment within the statutory deadline, notwithstanding the institution of any proceedings under any written law.

Confidential information

A minimum fine of RM20,000 will be imposed on a person that contravenes the treatment of confidential information received for the purpose of the LBATA as well as the restriction on the usage of such information.

Compound offences

The DGIR is empowered to compound offences with regards to Country-by-Country Reporting (CbCR) and Common Reporting Standards (CRS) compliances.