BDCM-B-Week19-Tax: Income Tax Act 1967 (As at 1st January 2019) Part 2 Episode 1

1.      Charge of income tax

a.      If you stay in Malaysia and have an income that you earn in Malaysia, or outside Malaysia, you need to pay tax! You will be assessed each year on how much tax you need to be pay, based on your yearly income

2.      Non-chargeability to tax in respect of offshore business activity

a.      No income tax to be charged on offshore business done by offshore company. They will fall under the jurisdiction of Labuan Offshore Business Activity Tax Act 1990.

3.      Classes of income on which tax is chargeable

a.      Gains or profit from a business

b.      Gains or profit from an employment

c.      Dividends, interest or discounts

d.      Rents, royalties or premiums

e.      Pensions, annuities or other periodical payments (that is not related in this classes)

f.       Gains or profit that comes from not above

4.      Special classes of income on which tax is chargeable

a.      If you are not staying in Malaysia but somehow able to gain or profits based on below action in Malaysia, you are subjected to income tax.

                                                    i.     Services or products provided by yourself or your employee

                                                   ii.     Advice, assistance or services  given

                                                  iii.     Rental received under any agreement or arrangement

5.      Non-business income

a.      There are many types of interest and as long it is not the interest type that is equivalent to the subsection 24(5), it is not taxable. We will further elaborate subsection 24(5) in next part/episode.

6.      Gain or profits from a business arising from stock in trade parted with by any element of compulsion

a.      If your business gains or profits from selling stock in trade, it is also subject to income tax.