Commencement of amendments to the Petroleum (Income Tax) Act 1967
(1) Section 34, paragraph 35(a), sections 36 and 37, and paragraphs 38(a) and (c) have effect for the year of assessment 2015 and subsequent years of assessment. (2) Paragraphs 35(b) and 38(b) have effect for the year of assessment 2016 and subsequent years of assessment.
Amendment of section 2
Subsection 2(1) of the Petroleum (Income Tax) Act 1967, which is referred to as the “principal Act” in this Chapter, is amended— (a) by inserting after the definition of “Inland Revenue Board of Malaysia” the following definition: ‘ “input tax” has the meaning assigned to it in the Goods and Services Tax Act 2014 [Act 762];’; and (b) by inserting after the definition of “natural gas” the following definition: ‘ “output tax” has the meaning assigned to it in the Goods and Services Tax Act 2014;’.
Amendment of section 18
Section 18 of the principal Act is amended— (a) in subsection (1)— (i) in the proviso to paragraph (n), by deleting the word “or”; (ii) by substituting for the full stop at the end of paragraph (o) a semicolon; and (iii) by inserting after paragraph (o) the following paragraphs: “(p) any amount paid or to be paid in respect of goods and services as input tax by the chargeable person if he is liable to be registered under the Goods and Services Tax Act 2014 and has failed to do so, or if he is entitled under that Act to credit that amount as input tax; or (q) any amount of output tax paid or to be paid under the Goods and Services Tax Act 2014 which is borne by the chargeable person if he is registered or liable to be registered under that Act.”; and (b) by inserting after subsection (1) the following subsection: “(1a) Notwithstanding any other provisions of this Act, where a person is required under section 34 to furnish to the Director General any information within the time specified in a notice or such other time as may be allowed by the Director General, and that information concerns wholly or in part a deduction claimed by that person in arriving at the adjusted income of that person from any source for the basis period for a year of assessment, no deduction from the gross income from that source for that period shall be allowed in respect of such claim if the person fails to provide such information within the time specified in that notice or such extended time as may be allowed by the Director General.”.
Amendment of section 39
Section 39 of the principal Act is amended by inserting after subsection (5) the following subsection: “(6) Notwithstanding any other provisions of this Act, where in a basis period for a year of assessment, an adjustment is made in respect of the input tax paid or to be paid under the Goods and Services Tax Act 2014, the Director General may at any time, as may be necessary to give effect to such adjustment, make an assessment or a reduced assessment for the year of assessment to which the adjustment relates, or if the year of assessment to which the adjustment relates cannot be ascertained, for the year of assessment in which the Director General discovers the adjustment.”.
Amendment of First Schedule
The First Schedule to the principal Act is amended— (a) by inserting after paragraph 1 the following paragraph: “1a. For the purposes of paragraph 1, the qualifying exploration expenditure incurred by a chargeable person shall not include any amount paid or to be paid in respect of goods and services tax as input tax by the chargeable person if he is liable to be registered under the Goods and Services Tax Act 2014 and has failed to do so, or if he is entitled under that Act to credit that amount as input tax.”; and (b) by inserting after paragraph 13 the following paragraph: “13a. (1) Where in the basis period for a year of assessment a chargeable person has incurred qualifying exploration expenditure in relation to an asset and the input tax on the asset is subject to any adjustment made under the Goods and Services Tax Act 2014, the amount of such expenditure in relation to that asset shall be adjusted in the basis period for the year of assessment in which the period of adjustment relating to the asset as provided under the Goods and Services Tax Act 2014 ends. (2) In the event the adjustment of the amount of the qualifying exploration expenditure made under subparagraph (1) results in— (a) an additional amount, such amount shall be deemed to be part of the qualifying exploration expenditure incurred, and the residual expenditure under paragraph 46 of the Second Schedule in relation to the asset shall include that additional amount; or (b) a reduced amount, the qualifying exploration expenditure incurred and the residual expenditure under paragraph 46 of the Second Schedule shall be reduced by such amount, and if the amount of the allowance made or ought to have been made under this Schedule exceeds the residual expenditure, the excess shall be part of the statutory income of that person from a source consisting of a business in the basis period the adjustment is made. (3) The excess amount referred to in subsubparagraph (2)(b) shall not exceed the total amount of allowances given under this Schedule. (4) Notwithstanding subparagraph (1), where a chargeable person has incurred the qualifying exploration expenditure in relation to an asset, and the asset is disposed of at any time during the period of adjustment specified under the Goods and Services Tax Act 2014, the adjustment to such expenditure shall be made in the basis period for the year of assessment in which the disposal is made. (5) Paragraph 13 shall apply for the purpose of the adjustment referred to in subparagraph (4).”.
Amendment of Second Schedule
The Second Schedule to the principal Act is amended— (a) by inserting after paragraph 2a the following paragraph: “2b. For the purposes of paragraph 1, the qualifying expenditure incurred by a chargeable person shall not include any amount paid or to be paid in respect of goods and services tax as input tax by a chargeable person if the chargeable person is liable to be registered under the Goods and Services Tax Act 2014 and has failed to do so, or if the chargeable person is entitled under that Act to credit that amount as input tax.”; (b) by inserting after paragraph 40 the following paragraph: “ 40 a . (1) Notwithstanding any other provisions of this Schedule, where any part of an asset of a chargeable person from a business ceases to be used for purposes of a business of his in a basis period for a year of assessment due to replacement with a new part and that new part is depreciated separately in accordance with the generally accepted accounting principles, that part of an asset is deemed to have been disposed of in that basis period for that year of assessment. (2) The qualifying expenditure of the part of the asset disposed shall be taken to be the amount determined for the new part being depreciated separately in accordance with the generally accepted accounting principles. (3) The residual expenditure under paragraph 46 in respect of the part of the asset disposed shall be the qualifying expenditure of the part of an asset disposed reduced by the amount of allowance that have been made or would have been made under this Schedule to that chargeable person prior to the disposal of that part of the asset. (4) The provisions of this Schedule shall apply to the new part of an asset referred to under subparagraphs (1) and (2).”; and (c) by inserting after paragraph 45 the following paragraph: “45a. (1) Where in the basis period for a year of assessment a chargeable person has incurred qualifying expenditure in relation to an asset and the input tax on the asset is subject to any adjustment made under the Goods and Services Tax Act 2014, the amount of such expenditure in relation to that asset shall be adjusted in the basis period for the year of assessment in which the period of adjustment relating to the asset as provided under the Goods and Services Tax Act 2014 ends. (2) In the event the adjustment of the amount of the qualifying expenditure made under subparagraph (1) results in— (a) an additional amount, such amount shall be deemed to be part of the qualifying expenditure incurred, and the residual expenditure under paragraph 46 in relation to the asset shall include that additional amount; or (b) a reduced amount, the qualifying expenditure incurred and the residual expenditure under paragraph 46 shall be reduced by such amount, and if the amount of the allowance made or ought to have been made under this Schedule exceeds the residual expenditure, the excess shall be part of the statutory income of that chargeable person from a source consisting of a business in the basis period the adjustment is made. (3) The excess amount referred to in subsubparagraph 2(b) shall not exceed the total amount of allowances given under this Schedule. (4) Notwithstanding subparagraph (2), where a chargeable person has incurred the qualifying expenditure in relation to an asset, and the asset is disposed of at any time during the period of adjustment specified under the Goods and Services Tax Act 2014, the adjustment to such expenditure shall be made in the basis period for the year of assessment in which the disposal is made. (5) Paragraphs 22 and 23 shall apply for the purpose of the adjustment referred to in subparagraph (4).”.
Provisions on this page are reproduced verbatim from official open data. See the attribution line.
Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).