Commencement of amendments to the Income Tax Act 1967
(1) Paragraph 5(a) has effect from the year of assessment 2020 until the year of assessment 2025.
(2) Section 6 has effect for the year of assessment 2019 and subsequent years of assessment.
(3) Sections 4, 7, 8, 9, 14, 20 and 21, and paragraph 19(a) have effect for the year of assessment 2020 and subsequent years of assessment.
(4) Paragraphs 5(b), 16(a) and 19(b), and sections 10, 11, 13, 15, 17 and 18 come into operation on 1 January 2020.
(5) Section 12 and paragraph 16(b) come into operation on the coming into operation of this Act.
Amendment of section 2
The Income Tax Act 1967, which is referred to as the “principal Act” in this Chapter, is amended in section 2 by substituting for subsection (9) the following subsection:
“(9) Any reference—
(a) in subsection 107 c (4 a ), to a company which has a paid-up capital in respect of ordinary shares of two million five hundred thousand ringgit and less at the beginning of the basis period for a year of assessment; and
(b) in paragraph 2a of Schedule 1 and paragraph 19a of Schedule 3, to a company which has a paid-up capital in respect of ordinary shares of two million five hundred thousand ringgit and less at the beginning of the basis period for a year of assessment and gross income from source or sources consisting of a business not exceeding fifty million ringgit for the basis period for that year of assessment, shall exclude a business trust and a company which is established for the issuance of asset-backed securities in a securitization transaction approved by the Securities Commission.”.
Amendment of section 6
Subsection 6(1) of the principal Act is amended—
(a) in paragraph (i), by substituting for the words “for a period of four years from the year of assessment 2016” the words “for a period of six years from the year of assessment 2020”; and
(b) in paragraph (l), by substituting for the words “death or permanently leaving Malaysia” the words “death, permanently leaving Malaysia, healthcare or housing, for which such withdrawal shall be in compliance with the criteria as set out in the relevant guidelines of the Securities Commission”.
Amendment of section 6a
Section 6a of the principal Act is amended—
(a) in subsection (1), by substituting for the words “subsections (2) and (3)” the words “subsections (2),
(2a) and (3)”;
(b) by inserting after subsection (2) the following subsections:
“(2 a ) A rebate shall be granted for a year of assessment in respect of departure levy which is charged and levied under the Departure Levy Act 2019 [Act 813] on any person who leaves Malaysia by air for the purpose of performing umrah or other religious pilgrimage and shall be evidenced by the boarding pass and—
(a) in the case of umrah, a copy of the visa issued by the embassy of the Kingdom of Saudi Arabia; or
(b) in the case of any other religious pilgrimage, a written verification by a religious body recognised by the Committee for the Promotion of Inter Religious Understanding and Harmony Among Adherents, Prime Minister’s Department.
(2b) For the purpose of subsection (2a), the rebate—
(a) shall be granted for not more than two times in respect of the departure levy paid for the purpose of performing umrah or other religious pilgrimage; and
(b) shall not be granted in respect of the departure levy paid for the purpose of performing hajj.”; and
(c) in subsection (4), by substituting for the words “subsections (2) and (3)” the words “subsections (2),
(2a) and (3)”.
Amendment of section 34
Subsection 34(6) of the principal Act is amended—
(a) in paragraph (h), by substituting for the words “infrastructure and information and communication technology” the words “infrastructure, information and communication technology or maintenance of a building designated as a heritage site by the Commissioner of Heritage under the National Heritage Act 2005 [Act 645]”; and
(b) in the proviso to paragraph (k), by substituting for the words “seven hundred thousand ringgit” the words “one million ringgit”.
Amendment of section 44
Section 44 of the principal Act is amended—
(a) in paragraph (1)(d), by substituting for the words “or (11c)” the words “, (11c) or (11d)”;
(b) in subsection (6), by substituting for the proviso to that subsection the following proviso:
“Provided that the amount to be deducted from the aggregate income for the relevant year in respect of any gift of money made to any institution, organization or fund approved for the purposes of this section by the Director General shall not exceed ten per cent of the aggregate income of that person in the relevant year.”;
(c) by substituting for subsection (6b) the following subsection:
“(6b) Where any institution, organization, appropriate religious authority, body or public university is aggrieved by the decision of the Director General in respect of an application made under subsection (6) or (11d), the institution, organization, appropriate religious authority, body or public university may, within thirty days after being informed of the decision, appeal to the Minister and the Minister may make any decision as he considers fit.”;
(d) in subsection (11b), by substituting for the proviso to that subsection the following proviso:
“Provided that the amount to be deducted pursuant to this subsection shall not exceed the difference between the amount of ten per cent of the aggregate income of that person in the relevant year and the total amount that has been deducted pursuant to the proviso to subsections (6), (11c) and (11d) for that relevant year.”;
(e) in subsection (11c), by substituting for the proviso to that subsection the following proviso:
“Provided that the amount to be deducted pursuant to this subsection shall not exceed the difference between the amount of ten per cent of the aggregate income of that person in the relevant year and the total amount that has been deducted pursuant to the proviso to subsections (6), (11b) and (11d) for that relevant year.”; and
(f) by inserting after subsection (11c) the following subsections: “(11 d ) There shall be deducted pursuant to this subsection from the aggregate income of a relevant person for the relevant year reduced by any deduction falling to be made for that year in accordance with subsection (1) an amount equal to any gift of money in the form of—
(a) wakaf made by him in the basis period for that year to any appropriate religious authority established under any written law, body established by that appropriate religious authority or public university allowed by that appropriate religious authority to receive wakaf; or
(b) endowment made by him in the basis period for that year to a public university: Provided that—
(a) the wakaf or endowment is made for the purpose of achieving the objective of establishment of the appropriate religious authority, body or public university;
(b) the appropriate religious authority, body or public university is approved by the Director General for the purposes of this section on the application of the appropriate religious authority, body or public university concerned; and
(c) the amount to be deducted pursuant to this subsection shall not exceed the difference between the amount of ten per cent of the aggregate income of that person in the relevant year and the total amount that has been deducted pursuant to the proviso to subsections (6), (11b) and (11c).
(11e) For the purpose of subsection (11d), “public university” means a higher educational institution having the status of a University established under the Universities and University Colleges Act 1971 [Act 30] and the Universiti Teknologi MARA established under the Universiti Teknologi MARA Act 1976 [Act 173].”.
Amendment of section 46
Subsection 46(1) of the principal Act is amended—
(a) by substituting for paragraph (g) the following paragraph:
“(g) medical expenses expended or deemed expended under subsection (3) in that basis year by that individual—
(i) on himself if he is undergoing treatment for a serious disease or on his wife or child who is undergoing treatment for a serious disease, or in the case of a wife, on herself if she is undergoing treatment for a serious disease or on her husband or child who is undergoing treatment for a serious disease; or
(ii) on himself if he is undergoing fertility treatment or on his wife who is undergoing fertility treatment, or in the case of a wife, on herself if she is undergoing fertility treatment or on her husband who is undergoing fertility treatment:
Provided that—
(a) the claim is evidenced by a receipt and certification issued by a medical practitioner registered with the Malaysian Medical Council that the serious disease treatment was provided to that individual, spouse or child, or that fertility treatment was provided to that individual or the spouse;
(b) the total amount of deduction under this paragraph is subject to a maximum amount of six thousand ringgit; and
(c) for the purpose of subparagraph (ii)—
(A) the individual is married; and
(B) “fertility treatment” means intrauterine insemination or in vitro fertilization treatment or any other fertility treatment;”; and
(b) in paragraph (r), by substituting for the words “one thousand ringgit” the words “two thousand ringgit”.
Amendment of section 74
Subsection 74(4) of the principal Act is amended by substituting for the words “subsection 103(3), (4), (5), (6), (7) or (8)” the words “subsection 103(3), (5) or (7)”.
Amendment of section 77b
Section 77b of the principal Act is amended by substituting for subsection (4) the following subsection:
“(4) The tax or additional tax payable under subsection (1) shall be increased by a sum equal to ten per cent of the amount of such tax or additional tax.”.
Amendment of section 91
Section 91 of the principal Act is amended by inserting after subsection (6) the following subsection:
“(7) Notwithstanding subsections (1) and (5), the Director General may at any time make an assessment or additional assessment, as the case may be, for a year of assessment in respect of a person, in the amount or additional amount of chargeable income and tax, in consequence of a mutual agreement procedure in the double taxation arrangement effected under section 132.”.
Amendment of section 96
Subparagraph 96(4)(c)(ii) of the principal Act is amended by substituting for the words “subsection 103(5), (6), (7) or (8)” the words “subsection 103(5) or (7)”.
Amendment of section 100
Section 100 of the principal Act is amended by substituting for subsection (1) the following subsection:
“(1) A person seeking to appeal against an assessment after the expiration of the period to make an appeal under subsection 99(1), may within seven years after the end of that period, make to the Director General a written application in the prescribed form for an extension of that period within which a notice of appeal against that assessment may be given under that subsection.”.
Amendment of section 103
Section 103 of the principal Act is amended—
(a) in subsection (1a)—
(i) by substituting for the colon a full stop; and
(ii) by deleting the proviso;
(b) by deleting subsection (4);
(c) by deleting subsection (6);
(d) by deleting subsection (8); and
(e) in subsection (9), by substituting for the words “ subsection
(1a), (3), (4), (5), (6), (7) or (8)” the words “subsection
(1a), (3), (5) or (7)”.
Amendment of section 104
Paragraph 104(1)(b) of the principal Act is amended—
(a) by substituting for the words “subsection 103(1a), (3),
(4), (5), (6), (7) or (8)” the words “subsection 103(1a),
(3), (5) or (7)”; and
(b) by substituting for the words “subsection 107c(9) or (10)” the words “subsection 107c(9), (10) or (10a)”.
Amendment of section 106
Subsection 106(3) of the principal Act is amended by substituting for the words “subsection 103(1a), (3), (4), (5), (6),
(7) or (8)” the words “subsection 103(1a), (3), (5) or (7)”.
Amendment of section 109g
Subsection 109 g (1) of the principal Act is amended by substituting for the words “death or permanently leaving Malaysia” the words “death, permanently leaving Malaysia, healthcare or housing, for which such withdrawal shall be in compliance with the criteria as set out in the relevant guidelines of the Securities Commission”.
Amendment of Schedule 1
Schedule 1 to the principal Act is amended—
(a) in Part I—
(i) by substituting for paragraph 1 the following paragraph: “1. Except where paragraphs 1a, 2, 2a, 2d, 3 and 4 provide otherwise, income tax shall be charged for a year of assessment upon the chargeable income of every person at the following rates: Chargeable income RM Rate of income tax For every ringgit of the 5,000 0 per cent first
Chargeable income RM Rate of income tax For every ringgit of the 15,000 1 per cent next For every ringgit of the 15,000 3 per cent next For every ringgit of the 15,000 8 per cent next For every ringgit of the 20,000 14 per cent next For every ringgit of the 30,000 21 per cent next For every ringgit of the 150,000 24 per cent next For every ringgit of the 150,000 24.5 per cent next For every ringgit of the 200,000 25 per cent next For every ringgit of the 400,000 26 per cent next For every ringgit of the 1,000,000 28 per cent next For every ringgit 2,000,000 30 per cent”; exceeding
(ii) in paragraph 1a , by substituting for the words “28 per cent” the words “30 per cent”;
(iii) by substituting for paragraph 2 a the following paragraph:
“2 a . Subject to paragraphs 2 b , 2 c and 3, income tax shall be charged for a year of assessment on the chargeable income of a company resident and incorporated in Malaysia which has a paid-up capital in respect of ordinary shares of two million five hundred thousand ringgit and less at the beginning of the basis period for a year of assessment and gross
income from source or sources consisting of a business not exceeding fifty million ringgit for the basis period for that year of assessment at the following rates:
Chargeable income RM Rate of income tax For every ringgit of 600,000 17 per cent the first For every ringgit 600,000 24 per cent”; and exceeding
(iv) by substituting for paragraph 2 d the following paragraph:
“2d. Subject to paragraphs 2e, 2f and 3, income tax shall be charged for a year of assessment on the chargeable income of a limited liability partnership resident in Malaysia which has a total contribution of capital (whether in cash or in kind) of two million five hundred thousand ringgit and less at the beginning of the basis period for a year of assessment and gross income from source or sources consisting of a business not exceeding fifty million ringgit for the basis period for that year of assessment at the following rates:
Chargeable income RM Rate of income tax For every ringgit of 600,000 17 per cent the first For every ringgit 600,000 24 per cent”; and exceeding
(b) in Part XVI, by substituting for the words “death or permanently leaving Malaysia” the words “death, permanently leaving Malaysia, healthcare or housing, for which such withdrawal shall be in compliance with the criteria as set out in the relevant guidelines of the Securities Commission”.
Amendment of Schedule 3
Paragraph 19a of Schedule 3 to the principal Act is amended—
(a) in subparagraph (1)—
(i) by substituting for the words “one thousand three hundred” the words “two thousand”; and
(ii) in the proviso, by substituting for the words “thirteen thousand” the words “twenty thousand”; and
(b) in subparagraph (3), by inserting after the words “at the beginning of the basis period for a year of assessment” the words “and gross income from source or sources consisting of a business not exceeding fifty million ringgit for the basis period for that year of assessment”.
Amendment of Schedule 6
Schedule 6 to the principal Act is amended in subparagraph 13(1)—
(a) b y d e l e t i n g t h e w o r d “ o r ” a t t h e e n d o f subsubparagraph (a);
(b) by substituting for the full stop at the end of subsubparagraph (b) the words “; or”; and
(c) by inserting after subsubparagraph (b) the following subsubparagraph:
“(c) an appropriate religious authority or a body or a public university approved for the purposes of subsection 44(11d) in respect of any wakaf or endowment received including the income derived therefrom in the basis period for a year of assessment, so long as the approval remains in force.”.
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).
