Personal Income Tax		Corporate Income Tax
	Double Tax Agreements		Service Tax
	Important Filing Dates		Other Tax Compliance

1. Rates From Y/A 2009

1. Resident individuals
   
   

   	Chargeable Income RM	Rate %	Tax Payable RM
   On the first	2,500	0	0
   On the next	2,500	1	25
   On the first	5,000		25
   On the next	5,000	3	150
   On the first	10,000		175
   On the next	10,000	3	300
   On the first	20,000		475
   On the next	15,000	7	1,050
   On the first	35,000		1,525
   On the next	15,000	12	1,800
   On the first	50,000		3,325
   On the next	20,000	19	3,800
   On the first	70,000		7,125
   On the next	30,000	24	7,200
   On the first	100,000		14,325
   On the next	50,000	27	13,500
   On the first	150,000		27,825
   On the next	100,000	27	27,000
   On the first	250,000		54,825
   Exceeding	250,000	27

   
   
2. Non-resident individuals
   
   

   Types of income	Rate %
   i) Public Entertainer’s professional income	15*
   ii) Interest	15*
   iii) Royalty	10*
   iv) Commission, guarantee fees, introducer's fees and other section 4(f)       income (wef 1-1-09)	10*
   v) Special classes of income:   - payment for services rendered in connection with use of property     or installation or operation of any plant, machinery or other apparatus     purchased from a non- resident person   - technical or management services fees for onshore services **   - rental of moveable property	10*   10*   10*
   *   Taxes collected by way of withholding tax

   
   

Payment made to a non-resident for item (i) to (v) is subject to the relevant withholding tax rates.
In respect of withholding tax not paid, a penalty of 10% is imposed on the amount of unpaid tax and on the total payment made to a non-resident.

2. Personal Reliefs for Resident individuals

	Types of relief	RM
a)	Self	8,000
b)	Disable individual (additional)	6,000
c)	Spouse	3,000
d)	Alimony payment to former wife	3,000
e)	Disabled spouse (additional)	3,500
f)	Child i. each qualifying child (18 years and below of age) ii. each qualifying child (over 18 years of age), receiving education at diploma level and above or studying under articles or indentures in a trade or profession - in Malaysia - outside Malaysia, if higher education commenced:      - before Y/A 2006      - after Y/A 2006 onwards	1,000 4,000 1,000 4,000
g)	Disabled child Disabled child studying at local institution of higher learning at diploma level and above Disabled child studying outside Malaysia at degree level and above	5,000 9,000 9,000
h)	Life insurance premiums and EPF contributions	≤ 6,000
i)	Insurance premiums for education or medical benefits	≤ 3,000
j)	Premium on annuity purchased under EPF annuity scheme	≤ 1,000
k)	Medical expenses for: - parents - self, spouse or child suffering from a serious disease (including fees   of up to RM500 incurred for complete medical examination)	≤ 5,000 ≤ 5,000
l)	Fee expended on approved courses* (extended to professional, accountancy and law courses from Y/A 2006) * Extended to courses in Islamic finance approved by Bank Negara    or Securities Commission, effective from Y/A 2007. * Extended to postgraduate and doctorate studies of all courses, effective     from Y/A 2008.	≤ 5,000
m)	Purchase of supporting equipment for a disabled person (self, child or parent)	≤ 5,000
n)	Cost incurred for the purchase of books, journals, magazines and other similar publications for the purpose of enhancing knowledge	≤ 1,000
o)	Purchase of a computer - claimed once in every three years - Separate assessment, each taxpayer (instead of each family) is eligible   to claim the relief	≤3,000
p)	Amount deposited into Skim Simpanan Pendidikan Nasional	≤3,000
q)	Purchase of any sports equipment (excluding sports altire and swim wear)	≤300
r)	Approved donations (max) Note: The above personal reliefs are effective from Y/A 2009 except stated otherwise.	7% of aggregate income

3. Tax Rebates

Rebate for resident individuals whose chargeable income does not exceed RM35,000. - where husband and wife are jointly assessed: - Individual - Wife - where husband and wife are separately assessed: - Individual - Alimony payment to former wife - Wife Rebate for Zakat, Fitrah or other Islamic religious dues paid Rebate for levies paid for employment pass, visit pass (temporary employment), or work pass

400 400 400 400 400 Actual amount expended in Malaysia Actual amount expended

4. Tax exempt BIK and allowances (Y/A2008 - Y/A 2010)

	Particulars / Description	Amount per annum            RM
a)	Petrol card & petrol/travelling allwance: - Between home & workplace - For official duties	2,400 6,000
b)	Parking allowances/fees	Amount incurred
c)	Meal allowance	Amount incurred
d)	Childcare allowance/subsidies	2,400
e)	Telephone & mobile phone (hardware & bill), pager, PDA, internet subsription	Amount incurred
f)	Employer's own goods - free / at discounted value	1,000
g)	Interest subsidy on existing & new loans on education, housing, passenger motor vehicles	On loan totalling up to RM300k
h)	Medical benefits extended to maternity & traditional medicines	Amount incurred
i)	Innovation, productivity & efficiency awards	2,000

a) Residence status

A company is tax resident in Malaysia if its management and control is exercised in Malaysia. Management and control is normally considered to be exercised at the place where directors?meetings are held for policy decision.

		Y/As 2004 -2006 Rate %	Y/A 2007 Rate %	Y/A 2008 Rate %	Y/A 2009 Rate %
i)	Resident companies aa) Having a paid-up ordinary share capital of RM2.5      million or less (at the beginning of Y/A)      Chargeable Income      On the first RM500,000      In excess of RM500,000      * Effective from Y/A 2009, the company must        not be owned by a company with paid up        capital > RM2.5 million	20 25	20 27	20 26	20 25
bb) Other companies       Chargeable Income		Y/As 2000-2006        28% Y/A 2007        27% Y/A 2008        26% Y/A 2009        25%
ii)	Non-resident companies Royalties Rental of moveable properties Technical or management service fees Interest Other income Section 4(f) Income     - Commission     - Guarantee Fees     - Introducer's Fees     - Other income	Y/As 2000-2008 Rate % 10 10 10 15 28 -		Y/A 2009 Rate % 10 10 10 15 27 10

Where the recipient is resident in a country which has a double tax treaty with Malaysia, the tax rates for specific sources of income may be reduced.

i)	Submission of returns and assessment aa) Tax returns (Form C & R) are required to be submitted within 7 months from the date of closing of accounts. bb) On submission of the return, an assessment is deemed to have been made on the company. The return is deemed to be a notice of assessment, which is deemed to be served on the company on the day that it is submitted.
ii)	Collection of tax aa) Payment of tax by 12* equal monthly instalments has to be made, beginning from the second month of the company’s basis period (taxable period). An estimate of tax payable for the year of assessment must be furnished to the Director General one month before the beginning of the basis period. An estimate should not be less than 85% of the previous year’s estimate or revised estimate, from Y/A 2006. For property developers, estimated losses of low cost housing project be set-off against estimated profits of other property development project in the above estimates. bb) The balance of tax payable by a company is due to be paid on the last day which the return must be submitted. * Number of instalments shall be increased or reduced depending on the number of months of basis period (taxable period) for a year of assessment.
iii)	Tax on interest, royalties, rental of moveable properties and technical or management service fees for onshore services received by non-resident companies are collected by means of withholding tax. The withholding tax is payable within one month of crediting or paying to the non-resident company.

Rate of withholding tax

	Royalties %	Interest %	Technical Fees %
Albania	10	Nil or 10	10
Argentina *	10	15	10
Australia	Nil or 10	Nil or 15	NIL
Austria	10	Nil or 15	10
Bahrian	8	Nil or 5	10
Bangladesh	Nil or 10	Nil or 15	10
Belgium	10	Nil or 10	10
Canada	Nil or 10	Nil or 15	10
Chile **	10	15	5
China, People’s Republic	Nil or 10	Nil or 10	10
Croatia	Nil or 10	Nil or 10	10
Czech Republic	10	Nil or 12	10
Denmark	Nil or 10	Nil or 15	10
Egypt	10	Nil or 15	10
Fiji	10	Nil or 15	10
Finland	Nil or 10	Nil or 15	10
France	Nil or 10	Nil or 15	10
Germany	Nil or 10	Nil or 15	NIL
Hungary	10	Nil or 15	10
India	Nil or 10	Nil or 10	10
Iran	10	Nil or 15	10
Ireland	8	Nil or 10	10
Indonesia #	Nil or 10	Nil or 15	10
Italy	Nil or 10	Nil or 15	10
Japan	10	Nil or 10	10
Jordan	10	Nil or 15	10
South Korea	10	15	10
Kyrgyz Republic	10	Nil or 10	10
Lebanon	Nil or 8	Nil or 10	10
Luxembourg	Nil or 8	Nil or 10	8
Malta	10	Nil or 15	10
Mauritius	10	Nil or 15	10
Mongolia	10	Nil or 10	10
Morocco	Nil or 10	Nil or 10	10
Myanmar **	10	Nil or 10	10
Nambia	5	Nil or 10	5
Netherlands	8	10	8
New Zealand	Nil or 10	Nil or 15	10
Norway	Nil or 10	Nil or 15	10
Pakistan	Nil or 10	Nil or 15	10
Papua New Guinea	10	Nil or 15	10
Philippines	Nil or 10	Nil or 15	10
Poland	Nil or 10	Nil or 15	10
Romania	Nil or 10	Nil or 15	10
Saudi Arabia	10	15	10
Seychelles	10	10	10
Singapore - old agreement	10	Nil or 15	10
- new agreement	8	Nil or 10	5
Sri Lanka	10	Nil or 10	10
Sudan	10	Nil or 10	10
Switzerland	Nil or 10	Nil or 10	10
Sweden - old agreement	Nil or 10	Nil or 15	10
- new agreement	Nil or 8	Nil or 10	8
Thailand	Nil or 10	Nil or 15	10
Turkey	10	Nil or 15	10
Russian Federation	10	Nil or 15	10
United Arab Emirates	10	Nil or 5	10
United Kingdom	8	Nil or 10	8
USA *	10	15	10
Uzbekistan	10	Nil or 10	10
Vietnam	10	Nil or 10	10
Zimbabwe **	10	Nil or 10	10

*   Limited double tax treaty. ** Gazetted DTAs; not yet entered into force. #   Protocol which amends limited articles of the treaty has been gazetted but not entered into      force. Notes: Payments of approved royalties or approved industrial royalties and interest on approved loans and long term loan (as defined in each DTA) to non residents are usually tax exempt. There is no withholding tax on dividends paid by Malaysian companies. In circumstances where the tax rate as stated in the Income Tax Act 1967 is lower than the maximum rate of tax as mentioned in the respective double tax agreement, the lower tax rate shall apply.

Avoidance of Double Taxation
Two methods or systems normally provided in a tax treaty to avoid double taxation of income are:-

1. Exemption Method/System
   Exemption is given to a person in the country of residence in respect of income arising from the country of source.
2. Credit Method/System
   Bilateral credit is given in the country of residence in respect of tax suffered in the country of source. It is computed by taking the lower of:-
   
      i) Foreign Income/ Total Income x Malaysian tax payable; or
      ii) Foreign tax suffered.

Effective from Y/A 2007, foreign income which is the statutory income, shall constitute income derived from outside Malaysia and includes income derived from Malaysia charged to foreign tax.

1. Charge of tax
Service tax is a consumption tax levied and charged on any taxable service provided by any taxable person at an ad valorem rate of 5%.

2. Taxable person/licensing

1. Any taxable person who carries on business of providing taxable service must apply for a license.
2. "Person" includes an individual, a firm, a society, an association, a company and every other juridical person.

* It is proposed in the Budget 2008 that with effect from 1.1.08, the threshold of RM150,000 for professional, consultancy and management service providers would be abolished.

# The increase in threshold from RM300,000 to RM3,000,000 is applicable w.e.f. 1.7.08. Reference is made to Service Tax (Amendment) Regulations 2008 [PU(A) 2/9/2008]

Submission of Tax Return Form

Category	Tax Return Form	Due Date for Submission
1. Resident Individual     with Business Income     without Business Income	B BE	30 June of every year 30 April of every year
2. Partnership	P	30 June of every year
3. Non-Resident Individual     with Business Income     without Business Income	M M	30 June of every year 30 April of every year
4. Estate     with Business Income     without Business Income	TP TP	30 June of every year 30 April of every year
5. Association     with Business Income     without Business Income	TF TF	30 June of every year 30 April of every year
6. Hindu Joint Family     with Business Income     without Business Income	TJ TJ	30 June of every year 30 April of every year
7. Company	C & R	7th month after the close of accounting year-end
8. Co-operative	CI	7th month after the close of accounting year-end
9. Unit Trust/Property Trust	TC	7th month after the close of accounting year-end
10. Trust Body	TA	7th month after the close of accounting year-end
11. Employers	E	31 March of every year

	Type of return	Form	Due Date
a)	All taxpayers Notification of change of address	Form 600B	Within 3 months of change
b)	Company * i)  submission of estimate of tax     payable     - Existing company     - New company which first      commenced business ii)  submission of revised estimate      of tax payable iii) submission of income tax return iv) submission of section 108      statement v)  Change of accounting period	Form CP 204 Form CP 204 Form CP 204A Form C Form R Form CP204B	30 days before the beginning of the basis period Within 3 months from commerce date of business operations In the sixth or/and ninth month of the basis period Within 7 months from the date of following the close of its accounting period Within 7 months from the date following the close of its accounting period One month before the beginning of new accounting period
c)	Employer i)  return of remuneration by an     employer ii) aa) notification of employee’s          commencement of          employment     bb) notification of employee’s          commencement of          cessation of employment          (in certain prescribed cases)     cc) notification of employee          leaving Malaysia for          cessation of employment          more than 3 months     dd) monthly statement of tax          deduction by employer          cessation of employment          under Schedular Tax          Deduction Scheme	Form E; CP 159 Form CP 22 Form CP 22A Form CP 21 Form CP 39	Within 30 days from the date of service or extended date granted (31 March) Within one month of commencement of employment Not less than one month before cessation of employment Not less than one month before cessation of employment Within 10 days after month end
d)	Withholding tax i)  On interest or royalty to non-    residents ii) On contract payments to non-    resident contractors iii) On onshore interest payments     (other than exempt interest) to      resident individuals iv) On technical and management     service fees, rental of moveable     properties, etc to non-residents     [Public Puling 4/2005]	Form CP 37 Form CP 37A Form CP 37C Form CP 37D	Within one month of paying or crediting the non-resident, whichever is earlier Within one month of paying or crediting the non-resident, whichever is earlier Bi-annual Within one month of paying or crediting the non-resident, whichever is earlier
e)	Real property gains tax ** i)  Return of disposal of     chargeable asset ii) Return of acquisition of     chargeable asset iii) Notification of becoming a     Real Property Company	Form C.K.H.T. 1 Form C.K.H.T. 2 Form C.K.H.T. 19	Within one month of date of disposal of chargeable asset Within one month of date of acquisition of chargeable asset Becomes a Real Property Company
f)	Sales tax - Submission of tax return and   payment of tax	Form CJ 3	Within 28 days after end of each taxable period
g)	Service tax - Submission of tax return and   payment of tax	Form CP 3	Within 28 days after end of each taxable period
h)	Social Security Organisation (SOCSO) - Submission of remittance form	Form 8A	Within 30 days after month end
i)	Employees?Provident Fund - Schedule of Monthly contributions   together with cheque	EPF 6 (Form A)	Within 15 days after month end

*   Effective from Y/A 2008, a newly set-up company with paid up capital ≤ RM2.5 million is      not required to furnish an estimate of tax payable or make instalment payments for a period      of 2 years beginning from the year of assessment in which the company commences      operation.

** Exempted for disposals or acquisition after 31-3-07

Disclaimer
The above information provided is based on taxation laws and other legislation, including legislative proposal and measures contained in the 2009 Malaysian Budget announcement on 29 August 2008.

While every reasonable care is taken of, we do not guarantee the accuracy of statements made by the contributors, or accept any responsibility for the above information provided.