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Insentif bagi Sektor Perkhidmatan

 

A Insentif bagi Pelaburan
Insentif bagi Sektor Perkhidmatan

Di Malaysia, insentif cukai, secara langsung dan tidak langsung, yang diperuntukkan dalam Akta Penggalakan Pelaburan 1986, Akta Cukai Pendapatan 1967, Akta Kastam 1967, Akta Cukai Jualan 1972, Akta Eksais 1976 dan Akta Zon Bebas 1990.Akta ini merangkumi pelaburan dalam pembuatan, pertanian, pelancongan perkhidmatan yang diluluskan (termasuk hotel) dan juga R & D, latihan dan aktiviti perlindungan alam sekitar.

Insentif cukai langsung memberikan pelepasan sebahagian atau sepenuhnya daripada pembayaran cukai pendapatan untuk tempoh tertentu, manakala insentif cukai tidak langsung adalah dalam bentuk pengecualian duti import dan duti eksais.

Insentif cukai utama untuk syarikat yang melabur dalam sektor perkhidmatan ialah Taraf Perintis dan Elaun Cukai Pelaburan.

Kelayakan bagi mendapatkan Taraf Perintis dan Elaun Cukai Pelaburan adalah berdasarkan keutamaan tertentu, termasuk paras nilai ditambah, teknologi digunakan dan rangkaian perindustrian. Aktiviti dan produk diistilahkan sebagai "promoted activities" (aktiviti digalakkan) atau "promoted products" (produk digalakkan). (See List of Promoted Activities and Products - General)

B Taraf Perintis
Taraf Perintis

Sebuah syarikat yang diberikan Taraf Perintis akan menikmati pengecualian sebahagian lima daripada pembayaran cukai pendapatan. Ia membayar cukai ke atas 30% daripada pendapatan berkanunnya*, dengan tempoh pengecualian bermula dari hari pengeluaran (ditakrifkan sebagai hari paras pengeluaran mencecah 30% daripada kapasiti).

Elaun modal tidak diserap dan kerugian terkumpul yang ditanggung semasa tempoh perintis boleh dibawa ke hadapan dan ditolak daripada pendapatan pasca perintis syarikat berkenaan.

Permohonan bagi Taraf Perintis hendaklah dikemukakan kepada Lembaga Pembangunan Pelaburan Malaysia (MIDA).

*Pendapatan berkanun diperolehi setelah ditolak perbelanjaan hasil dan elaun modal daripada pendapatan kasar.

C Elaun Cukai Pelaburan
Elaun Cukai Pelaburan

Sebagai alternatif kepada Taraf Perintis, sebuah syarikat boleh memohon Elaun Cukai Pelaburan (ITA). Sebuah syarikat yang diberikan ITA mendapat elaun sebanyak 60% ke atas perbelanjaan modal yang layak (seperti kilang, loji, mesin dan peralatan lain yang digunakan untuk projek yang diluluskan) yang dilakukan dalam tempoh lima tahun dari tarikh perbelanjaan modal yang layak pertama dilakukan.

Syarikat boleh menggunakan elaun ini dengan 70% daripada pendapatan berkanun bagi setiap tahun taksiran. Mana-mana elaun yang tidak digunakan boleh dibawa ke hadapan ke tahun-tahun berikutnya sehingga digunakan sepenuhnya. Baki 30% daripada pendapatan berkanun akan dikenakan cukai pada kadar cukai syarikat yang lazim.

Permohonan hendaklah dikemukakan kepada MIDA.

Insentif bagi Sektor Perkhidmatan

1 Insentif bagi Industri Pelancongan

Projek pelancongan, termasuk projek agro-pelancongan,dan eko-pelancongan layak untuk mendapat insentif cukai. Ini termasuk perniagaan hotel, projek pelancongan termasuk taman tema dalam dan taman tema luar, pembinaan kem percutian, projek rekreasi termasuk kem rekreasi dan pembinaan pusat konvensyen dengan kapasiti untuk menampung sekurang-kurangnya 3,000 peserta.

Insentif bagi Hotel dan Projek Pelancongan

Syarikat yang menjalankan pelaburan baru di hotel 1-5 bintang dan projek pelancongan layak mendapat insentif berikut:

  1. Taraf Perintis
  2. Sebuah syarikat yang diberikan Taraf Perintis menikmati pengecualian sebahagian lima daripada pembayaran cukai pendapatan. Ia hanya perlu membayar cukai ke atas 30% daripada pendapatan berkanun, bermula dari Hari Pengeluaran yang ditentukan oleh Menteri Perdagangan Antarabangsa dan Industri.

    Elaun modal tidak diserap dan kerugian terkumpul yang ditanggung semasa tempoh perintis boleh dibawa ke hadapan dan ditolak daripada pendapatan pasca perintis syarikat berkenaan.

    Permohonan hendaklah dikemukakan kepada MIDA sebelum memulakan perniagaan.

  3. Elaun Cukai Pelaburan
  4. Sebagai alternatif kepada Taraf Perintis, sebuah syarikat boleh memohon Elaun Cukai Pelaburan (ITA). Sebuah syarikat yang diberikan ITA menerima elaun sebanyak 60% ke atas perbelanjaan modal yang layak yang dilakukan dalam tempoh lima tahun dari tarikh perbelanjaan modal yang layak pertama dilakukan.

    Syarikat-syarikat boleh menggunakan elaun ini dengan 70% pendapatan berkanun dalam tahun taksiran. Sebarang jumlah elaun yang tidak digunakan boleh dibawa ke tahun-tahun berikutnya sehingga digunakan sepenuhnya.

    Permohonan hendaklah dikemukakan kepada MIDA sebelum memulakan perniagaan.

    Permohonan untuk 4 dan 5 bintang yang diterima oleh 31 Disember 2018 layak mendapat insentif ini.

  5. Insentif yang dipertingkatkan untuk Akujanji Pelaburan Baru dalam Hotel
  6. Syarikat yang membuat pelaburan baru di hotel 4 dan 5 bintang di Sabah dan Sarawak adalah layak untuk insentif berikut :

    1. Taraf Perintis dengan pengecualian cukai pendapatan sebanyak 100% daripada pendapatan berkanun untuk tempoh lima tahun. Elaun modal tidak diserap dan kerugian terkumpul yang ditanggung semasa tempoh perintis boleh dibawa ke hadapan dan ditolak daripada pendapatan pasca perintis syarikat berkenaan; atau
    2. Elaun Cukai Pelaburan sebanyak 100% ke atas perbelanjaan modal yang layak yang dilakukan dalam tempoh lima tahun. Elaun ini boleh ditolak sebanyak 100% daripada pendapatan berkanun bagi setiap tahun taksiran. Sebarang jumlah elaun yang tidak digunakan boleh dibawa ke tahun-tahun berikutnya sehingga digunakan sepenuhnya.

    Permohonan yang diterima oleh 31 Dis 2018 layak mendapat insentif ini.

    Permohonan hendaklah dikemukakan kepada MIDA sebelum memulakan perniagaan.

  7. Insentif Pelaburan Semula dalam Hotel
  8. Syarikat-syarikat yang melabur semula dalam pembesaran dan pemodenan di hotel 1-5 bintang layak untuk pusingan tambahan Elaun Cukai Pelaburan seperti berikut:

    60% (100% untuk 4 dan 5 bintang di Sabah dan Sarawak) ke atas perbelanjaan modal yang layak yang dilakukan dalam tempoh lima tahun. Elaun ini boleh ditimbal balik dengan 70% (100% untuk 4 dan 5 bintang di Sabah dan Sarawak) daripada pendapatan berkanun bagi setiap tahun taksiran. Sebarang jumlah elaun yang tidak digunakan boleh dibawa ke tahun-tahun berikutnya sehingga digunakan sepenuhnya.

    Syarikat layak untuk memohon ITA untuk tiga pusingan pelaburan semula. Bagi kumpulan syarikat, hanya 3 syarikat dalam kumpulan yang layak mendapat insentif cukai. (Lihat Senarai Digalakkan dan Aktiviti - Pelaburan Semula)

    Permohonan hendaklah dikemukakan kepada MIDA sebelum perbelanjaan modal yang layak pertama dilakukan.

  9. Insentif bagi Pelaburan Semula dalam Projek Pelancongan

    Syarikat-syarikat yang melabur semula dalam pembesaran dan pemodenan dalam projek-projek pelancongan layak untuk pusingan tambahan Taraf Perintis atau Elaun Cukai Pelaburan seperti berikut:

    1. Taraf Perintis dengan pengecualian cukai pendapatan sebanyak 70% daripada pendapatan berkanun untuk tempoh lima tahun. Elaun modal tidak diserap dan kerugian terkumpul yang ditanggung semasa tempoh perintis boleh dibawa ke hadapan dan ditolak daripada pendapatan pasca perintis syarikat berkenaan; atau
    2. Elaun Cukai Pelaburan sebanyak 60% ke atas perbelanjaan modal yang layak yang dilakukan dalam tempoh lima tahun. Elaun ini boleh ditolak sebanyak 70% daripada pendapatan berkanun bagi setiap tahun taksiran. Sebarang jumlah elaun yang tidak digunakan boleh dibawa ke tahun-tahun berikutnya sehingga digunakan sepenuhnya.

    Syarikat layak untuk memohon PS dan ITA bagi dua pusingan pelaburan semula. (Lihat Senarai Digalakkan dan Aktiviti - Pelaburan Semula). (See List of Promoted Products and Activities - Reinvestments)

    Permohonan hendaklah dikemukakan kepada MIDA sebelum perbelanjaan modal yang layak pertama dilakukan.

2 Insentif untuk Pemaju, Pengurus dan Operator 'Mine Wellness City'

Mines

Insentif untuk Pemaju, Pengurus dan Operator 'Mines Wellness City'

'Mines Wellness City (MWC)' ialah Kesihatan dan Kesejahteraan resort bersepadu yang pertama di Malaysia; kawasan terkemuka destinasi pelancongan kesihatan dan mercu tanda.

Ia adalah destinasi utama untuk semua keperluan kesihatan anda dan gaya hidup. Ia percutian yang sihat dan relaks, hanya mengambil masa 15 minit dari pusat bandar Kuala Lumpur.

Disokong oleh Programmer Transformasi Ekonomi Malaysia (ETP), datanglah dan menemui apa MWC boleh lakukan untuk kesihatan, percutian , perniagaan, rumah dan keluarga anda. Ia adalah tempat di mana masyarakat, perniagaan dan rangkaian dihubungkan bersama-sama dan bertepatan di destinasi tunggal dalam berkongsi visi hidup kehidupan sejahtera.

Insentif Cukai
  • Pembangun MWC (Garis Panduan)
  • pengecualian cukai pendapatan ke atas pendapatan yang diperoleh daripada pelupusan tanah dan bangunan di MWC dari Tahun Taksiran 2013 hingga tahun taksiran 2023; atau

    pengecualian cukai pendapatan ke atas pendapatan yang diperolehi daripada sewa bangunan yang terletak di MWC dari tahun taksiran 2013 hingga tahun taksiran 2026;

    50% pengecualian duti setem ke atas surat cara pengangkut atas pengambilalihan dan sewa tanah atau bangunan yang terletak di MWC dilaksanakan 2013-2023.

  • Pengurus MWC (Garis Panduan)
  • pengecualian cukai pendapatan ke atas pendapatan yang diperoleh daripada menyediakan pengurusan, penyeliaan atau pemasaran kepada pemaju di MWC dari tahun taksiran 2013 hingga tahun taksiran 2023.

  • Pengendali MWC (Garis Panduan)
  • 70% pengecualian cukai ke atas pendapatan yang diperolehi daripada aktiviti yang layak dalam perkhidmatan penjagaan kesihatan atau perkhidmatan jagaan kesihatan pelengkap dan tradisional yang dijalankan di MWC selama 5 tahun dari tarikh permulaan perniagaan daripada aktiviti yang layak berkata; atau Elaun Cukai Pelaburan sebanyak 60% atau lebih untuk 5 tahun ke atas perbelanjaan modal yang layak yang dilakukan untuk aktiviti yang layak dilakukan dalam tempoh MWC dan elaun ini dibenarkan ditolak sehingga 70% daripada pendapatan berkanun untuk tahun taksiran berkaitan.

Untuk maklumat lanjut dan peluang perniagaan lain di MWC, sila lawati www.mineswellnesscity.com atau hubungi 03-8943 8811.

Untuk memohon insentif MWC.

3 Incentives for Environmental Management
Incentives for Green Technology

The incentives which were announced in Budget 2014 will cover broader scope of green technology activities in the areas of energy, transportation, building, waste management, and supporting services activities. It also facilitates the transition of the expired (by 31 December 2015) tax incentives relating to renewable energy (RE) and energy efficiency (EE) projects under the Promotion of Investment Act (PIA), 1986.

  • Tax Incentive for Green Technology Project
  • Investment Tax Allowance (ITA) of 100% of qualifying capital expenditure incurred on a green technology project from the year of assessment 2013 (date on which the first qualifying capital expenditure incurred is not earlier than 25 October 2013) until the year of assessment 2020. The allowance can be offset against 70% of statutory income in the year of assessment. Unutilised allowances can be carried forward until they are fully absorbed.
    Green technology project related to renewable energy, energy efficiency, green building, green data centre, and waste management can qualify for this tax incentive. Please refer to the Guideline for Application for Incentives and/or Expatriate Posts for Green Technology (GT) at www.mida.gov.my for more details on qualifying activities and eligibility criteria.
    Applications received by 31 December 2020 are eligible for this incentive.
    Applications should be submitted to MIDA.
  • Tax Incentive for Green Technology Services
  • Income tax exemption of 100% of statutory income from the year of assessment 2013 until the year of assessment 2020. Green technology services related to renewable energy, energy efficiency, electric vehicle (EV), green building, green data centre, green certification and verification, and green township can qualify for this tax incentive.
    Applications received by 31 December 2020 are eligible for this incentive.
    Applications should be submitted to MIDA.
  • Tax Incentive for Purchase of Green Technology Assets
  • Investment Tax Allowance (ITA) of 100% of qualifying capital expenditure incurred on green technology asset from the year of assessment 2013 (date on which the first qualifying capital expenditure incurred is not earlier than 25 October 2013) until the year of assessment 2020. The allowance can be offset against 70% of statutory income in the year of assessment. Unutilised allowances can be carried forward until they are fully absorbed.
    Applications received by 31 December 2020 are eligible for this incentive.
    Applications should be submitted to MGTC.
Incentives for Establishment of Waste Eco Parks (WEPs)

Waste Eco Park (WEP) aims to promote waste recycling, recovery and treatment activities by the industries and provides a sustainable solution to waste management problem. This will encourage investments in facilities and infrastructure towards holistic waste management activities. In order to promote the activities, there are incentives available for WEP Developer, WEP Manager and WEP Operator (companies operating in the WEP).

  • WEP Developers 
  • Income Tax Exemption of 70% on statutory income derived from rental of building, fees received from the usage of waste collection and separation facility and fees received from waste water treatment facility located in the WEP effective from Year of Assessment 2016 until Year of Assessment 2025.

    The developer must develop the infrastructure within the WEP which incorporates basic infrastructure (e.g. roads, drainage system, utilities & sewerage), building & facility for waste receiving & separation, waste water treatment facility and building for education and awareness centre and/or disposal facility. The WEP must also be approved by the National Solid Waste Management Department (JPSPN), relevant Waste Authorities, State Government or Local Authorities.

    Applications received by MIDA from 1 January 2016 until 31 December 2020, are eligible to be considered for this incentive.

  • WEP Managers
  • Income Tax Exemption of 70% on statutory income derived from services activities related to management, maintenance, supervision and marketing of the WEP effective from Year of Assessment 2016 until Year of Assessment 2025.

    Eligible to companies appointed by the developer of WEP to manage the WEP.

    Applications received by MIDA from 1 January 2016 until 31 December 2020, are eligible to be considered for this incentive.

  • WEP Operators (companies operating in WEP)
  • Income Tax Exemption of 100% on statutory income for a period of 5 years, derived from the qualifying activities undertaken in the WEP

    Or

    Income Tax Exemption equivalent to 100% of qualifying capital expenditure (Investment Tax Allowance) incurred within a period of 5 years. The allowance can be offset against 70% of statutory income for each assessment year.

    This incentive is eligible to companies located in the WEP undertaking qualifying activities of waste treatment, waste recovery and waste recycling.

    Applications received by MIDA from 1 January 2016 until 31 December 2020, are eligible to be considered for this incentive.

Accelerated Capital Allowance for Environmental Management

Companies using environmental protection equipment are eligible for an initial allowance of 40% and an annual allowance of 20% on the qualifying capital expenditure. Thus, the full amount can be written off within three years.

These companies are:

  • Waste generators and wish to establish facilities to store, treat and dispose off their wastes, either on-site or off-site; and
  • Undertake waste recycling activities.

Applications should be submitted to IRB.

In the case of companies that incur capital expenditure for conserving their own energy for consumption, the write-off period is accelerated by another one year.

Applications should be submitted to IRB with a letter from the Ministry of Energy, Green Technology and Water certifying that the related equipment is used exclusively for the purpose of energy conservation.

4 Incentives for Research and Development
Introduction

The Promotion of Investments Act 1986 defines research and development (R&D) as "any systematic or intensive study carried out in the field of science or technology with the objective of using the results of the study for the production or improvement of materials, devices, products, produce or processes but does not include:

  • quality control of products or routine testing of materials, devices, products or produce;
  • research in the social sciences or humanities;
  • routine data collection;
  • efficiency surveys or management studies;and
  • market research or sales promotion."

To further strengthen Malaysia's foundation for more integrated R&D, companies which carry out design, development and prototyping as independent activities are also eligible for incentives.

Main Incentives for Research and Development
  1. Contract R&D Company
  2. A contract R&D company, i.e., a company that provides R&D services in Malaysia to a company other than its related company, is eligible for:

    • Pioneer Status with income tax exemption of 100% of the statutory income for five years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company; or
    • Investment Tax Allowance (ITA) of 100% on the qualifying capital expenditure incurred within 10 years. The allowance can be offset against 70% of the statutory income for each year of assessment. Any unutilised capital allowances can be carried forward to subsequent years until fully utilised.

    Applications should be submitted to MIDA.

  3. R&D Company
  4. A R&D company, i.e. a company that provides R&D services in Malaysia to its related company or to any other company, is eligible for an ITA of 100% on the qualifying capital expenditure incurred within 10 years. The allowance can be offset against 70% of the statutory income for each year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised.

    Should the R&D company opt not to avail itself of the allowance, its related companies can enjoy double deduction for payments made to the R&D company for services rendered.

    Applications should be submitted to MIDA.

    Eligibility:

    Contract R&D and R&D companies that fulfill the following criteria can apply for the various incentives:

    1. Research undertaken should be in accordance with the needs of the country and bring benefit to the economy;
    2. At least 70% of the income of the company should be derived from R&D activities;
    3. For manufacturing-based R&D, at least 50% of the workforce of the company must be appropriately qualified personnel performing research and technical functions; and
    4. For agriculture-based R&D, at least 5% of the workforce of the company must be appropriately qualified personnel performing research and technical functions.
  5. In-house Research
  6. A company that undertakes in-house R&D to further its business can apply for an ITA of 50% of the qualifying capital expenditure incurred within 10 years. The company can offset the allowance against 70% of its statutory income for each year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised.

    Applications should be submitted to MIDA.

  7. Incentives for Reinvestment in R&D Activities
  8. R&D companies/activities mentioned in categories (i) - (iii) are eligible for a second round of Pioneer Status for another five years, or ITA for a further 10 years, where applicable. (See List of Promoted Activities and Products - Reinvestment)

    Applications should be submitted to MIDA

  9. Incentives for Commercialisation of Public Sector R&D
  10. To encourage commercialisation of resource-based R&D findings of public research institutes, the following incentives are given:

    1. A company that invests in its subsidiary company engaged in the commercialisation of the R&D findings is eligible for a tax deduction equivalent to the amount of investment made in the subsidiary company; and
    2. The subsidiary company that undertakes the commercialisation of the R&D findings is eligible for Pioneer Status with income tax exemption of 100% of statutory income for 10 years.

    The incentive is provided on the following conditions:

    1. At least 70% of the investing company (holding company) and the company undertaking the commercialisation projects are owned by Malaysians;
    2. The company which invests should own at least 70% of the equity of the company that commercialises the R&D findings;
    3. The commercialisation of the R&D findings should be implemented within one year from the date of approval of the incentive
Additional Incentives for Research and Development
  1. Double Deduction for Research and Development
  2. A company can enjoy a double deduction on its revenue (non-capital) expenditure for research which is directly undertaken and approved by the Minister of Finance.

    Double deduction can also be claimed for cash contributions or donations to approved research institutes, and payments for the use of the services of approved research institutes, approved research companies, R&D companies or contract R&D companies.

    Approved R&D expenditure incurred during the tax relief period for companies granted Pioneer Status can be accumulated and deducted after the tax relief period.

    Expenditure on R&D activities undertaken overseas, including the training of Malaysian staff, will be considered for double deduction on a case-by-case basis.

    Claims should be submitted to IRB.

  3. Incentives for Researchers to Commercialise Research Findings
  4. Researchers who undertake research focused on value creation will be given a 50% tax exemption for five years on the income that they receive from the commercialisation of their research findings. The undertaking has to be verified by the Ministry of Science, Technology and Innovation.

    Claims should be submitted to IRB.

5 Incentives for Training
Main Incentives for Training

To encourage human resource development, the following incentives are available:

Investment Tax Allowance

New private higher education institutions (PHEIs) in the field of science and companies that establish technical or vocational training institution are eligible for an Investment Tax Allowance (ITA) of 100% for 10 years. This allowance can be offset against 70% of the statutory income for each year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised.

The above incentive also applies to existing PHEIs in the field of science and existing companies providing technical or vocational training that undertake new investments to upgrade their training equipment or expand their training capacities.

The qualifying science courses for PHEIs are as follows:

  1. Biotechnology
    • Medical and health biotechnology
    • Plant biotechnology
    • Food biotechnology
    • Industrial and environment biotechnology
    • Pharmaceutical biotechnology
    • Bioinformatics biotechnology
  2. Medical and Health Sciences
    • Medical science in gerontology
    • Medical science in clinical research
    • Medical biosciences
    • Biochemical genetics
    • Environmental health
    • Community health
  3. Molecular Biology
    • Immunology
    • Immunogenetics
    • Immunobiology
  4. Material sciences and technology
  5. Food science and technology

Applications should be submitted to MIDA.

Incentives for Technical and Vocational Training Institutes

Companies that establish technical or vocational training institutions are eligible for an ITA of 100% for ten (10) years. This allowance can be offset against 70% of the statutory income for each year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised.

Existing companies providing technical or vocational training that undertake additional investments to upgrade their training equipment or expand their training capacities also qualify for this incentive.

The qualifying technical or vocational courses are as follows:

    • Automotive (Electrical)
    • Automotive (Mechanical)
    • Computer Technology
    • Digital Electronics & Trouble Shooting
    • Industrial Solid State Electronics
    • Power Electronics
    • Mechatronics
    • Hydraulics & Pneumatics
    • Precision Machining
    • CNC Machining
    • Industrial Automation/Process Control/Robotics
    • Instrumentation and Control
    • Programmable Logic Controllers
    • Metallurgy
    • Metrology
    • Heat Treatment
    • Surface Treatment
    • Mould, Tools & Dies Making - CAM, EDM, Wire Cutting
    • Mould, Tools & Dies Design - CAD
    • Precision Optics
    • Sheet Metalworking
    • Welding/Arc Welding/Gas Welding/MIG/TIG Welding
    • Wood Machining
    • Electrical Chargemen AO (Medium Pressure)
    • Electrical Chargemen BO (High Tension) Industrial and Domestic Wiring Installation
    • Air-conditioning & Refrigeration
    • Printing
    • Furniture Making
    • Industrial Sewing
    • Mechanical Engineering (Plant/Machinery Maintenance)
    • Aeronautics

Eligibility Criteria

  1. The company must be locally incorporated under the Companies Act, 1965.
  2. The establishment of the institution must be approved by the Ministry of Higher Education/Licensing Body / Registrar which is approved by the Government of Malaysia.
  3. At least 70% of the students enrolled must be registered in the field of technical or vocational training or science and at least 70% of the students sitting for examinations must be in the technical or vocational field of studies.

Applications should be submitted to MIDA.

Additional Incentives for Training
  1. Deduction for cost of recruitment workers
  2. Cost of recruitment of workers is allowed as a deduction for the purpose of tax computation.

    Cost includes expenses incurred in participation in job fairs, payment to employment agencies and head-hunters.

    Claims should be submitted to the IRB.

  3. Deduction for Pre-Employment Training
  4. Training expenses incurred before the commencement of business qualify for a single deduction. Nevertheless, companies must prove that they will employ the trainees.

    Claims should be submitted to IRB.

  5. Deduction for Non-Employee Training
  6. Expenses incurred in providing practical training to residents who are not employees of the company can be considered for single deduction.

    Claims should be submitted to IRB.

  7. Deduction for Cash Contributions
  8. Contributions in cash to technical or vocational training institutions that are not operating primarily for profit and those established and maintained by a statutory body qualify for single deduction.

    Claims should be submitted to IRB

  9. Special Industrial Building Allowance
  10. Companies that incur expenditure on buildings used for approved industrial, technical or vocational training can claim a special annual Industrial Building Allowance (IBA) of 10% for 10 years on qualifying capital expenditure for the construction or purchase of a building.

    Claims should be submitted to IRB.

  11. Tax Exemption on Educational Equipment
  12. Approved training institutes, in-house training projects and all private institutions of higher learning are eligible for import duty, sales tax and excise duty exemptions on all educational equipment including laboratory equipment for workshops, studios and language laboratories.

    Applications should be submitted to MIDA.

  13. Tax Exemption on Royalty Payments
  14. Royalty payments made by educational institutions to non-residents (franchisors) for franchised education programmes that are approved by the Ministry of Education are eligible for tax exemption.

    Claims should be submitted to IRB.

  15. Double Deduction for Approved Training
  16. Manufacturing and non-manufacturing companies that do not contribute to the Human Resource Development Fund (HRDF) qualify for double deduction on expenses incurred for approved training.

    For the manufacturing sector, the training could be undertaken in-house or at approved training institutions. However, for the non-manufacturing sector, the training should be held only at approved training institutions. Approval is automatic when the training is at approved institutions.

    For the hotel and tour operation business, training programmes, in-house or at approved training institutions, to upgrade the level of skills and professionalism in the tourism industry, should be approved by the Ministry of Tourism.

    Effective from the year of assessment 2009 to year of assessment 2012, employers who incur expenses for training their employees in the following skills are eligible for double deduction:

    Post graduate courses in information communication and technology (ICT), electronics and life sciences; Post basic courses in nursing and allied heath care; and Aircraft maintenance engineering courses.

    Claims should be submitted to IRB.

  17. Human Resource Development Fund (HRDF)
  18. Please refer to 'Manpower for Industry'.

    Claims should be submitted to the IRB.

  19. Tax Incentive for Structured Internship Programme
  20. Double deduction is given on expenses incurred by companies that implement the structured internship programme. The qualifying criteria for this programme among others are as follows:

    1. The internship programme is for full time undergraduate students from the Public/Private Higher Educational Institutions; and
    2. Internship programme is for a minimum period of 10 weeks with a monthly allowance of not less than RM 500.

    Claims should be submitted to the IRB.

    The incentive applicable for year of assessment 2012 until 2016.

  21. Double Deduction for Awarding Scholarship
  22. It is proposed that scholarships awarded by private companies to Malaysian students pursuing study at diploma and bachelor's degree in local institutions of higher learning registered with the Ministry of Higher Education be given double deduction.

    Scholarships awarded are for students that fulfill the following criteria:

    1. Full time student;
    2. Have no sources of income; and
    3. Total monthly income of parents or guardian of the student does not exceed RM5,000.

    Claims should be submitted to the IRB.

    The incentive applicable for year assessment 2012 until 2016.

6 Incentives for the Promotion of Healthcare Travel
Incentives for Private Healthcare Facilities

Companies that establish new private healthcare facilities or existing private healthcare facilities undertaking expansion/modernisation/refurbishment for purposes of promoting healthcare travel are eligible to apply for an income tax exemption equivalent to Investment Tax Allowance (ITA) of 100% on the qualifying capital expenditure incurred within a period of five (5) years. The allowance can be used to offset against 100% of the statutory income for each year of assessment. Any unutilised allowance can be carried forward to subsequent years until fully utilised.

For purposes of this incentive, private healthcare facilities means private hospitals or ambulatory care centres.

Application must be submitted to MIDA together with the approval for expansion/modernisation/refurbishment (Form 6) from MOH.

The incentive is applicable for applications received by MIDA on or after 1 January 2015 but not later than 31 December 2017.

7 Incentives for Approved Service Projects

Approved Service Projects (ASPs) or projects in the transportation, communications and utilities sub-sectors approved by the Minister of Finance qualify for the following tax incentives:

Main Incentives for ASPs
  1. Exemption under Section 127 of the Income Tax 1967
  2. Under Section 127 of the Income Tax 1967, companies undertaking ASPs can apply for income tax exemption of 70% of their statutory income for five years. Companies undertaking ASPs of national and strategic importance are eligible for a 100% income tax exemption of their statutory income for 10 years.

    Applications should be submitted to the Ministry of Finance.

  3. Investment Allowance under Schedule 7B of the Income Tax Act 1967
  4. The Investment Allowance (IA) under Schedule 7B of the Income Tax Act 1967 is an alternative to the incentive offered under Section 127. Under IA, companies undertaking ASPs are eligible for an allowance amounting to 60% on the qualifying capital expenditure incurred within five years from the date the first capital expenditure is incurred. The allowance can be offset against 70% of the statutory income and any unutilised allowances can be carried forward to subsequent years until fully utilised.

    Companies undertaking ASPs of national and strategic importance are eligible for an allowance of 100% on the qualifying capital expenditure incurred within five years. This allowance can be offset against 100% of the statutory income.

    Applications should be submitted to the Ministry of Finance.

Additional Incentives for ASPs

Exemption from Import Duty and Excise Duty on Raw Materials, Components, Machinery, Equipment, Spares and Consumables

Imports of raw materials and components not available locally and used directly to implement ASPs are eligible for exemption from import duty and sales tax, while locally purchased machinery or equipment are eligible for exemption from sales tax and excise duty.

Companies providing services in the transportation and telecommunications sectors, power plants and port operators can apply for import duty and sale tax exemption on spares and consumables that are not produced locally.

The above applications should be submitted to Ministry of Finance.

8 Incentives for Acquiring A Foreign Company for High Technology
Incentives for Acquiring A Foreign Company for High Technology

A locally-owned company in the manufacturing or services sector that acquires a foreign-owned company abroad will be eligible for an incentive in the form of an annual deduction of 20% of the acquisition cost for 5 years for the following purpose:

  • Establishment of a manufacturing facility/company or services company within Malaysia; or
  • Utilisation of the acquired technology in their existing operations within Malaysia

The incentive is in the form of an annual deduction to ascertain the adjusted income of the locally-owned company, and any unutilised deduction can be carried forward until fully utilised.

Application received by MIDA from 3 July 2012 until 31 December 2016 are eligible to be considered for this incentive.

Applications should be submitted to MIDA.

9 Incentives for Integrated Logistics Services
Incentives for Integrated Logistics Services

Companies providing the following value-added manufacturing related services are eligible for the Pioneer Status or Investment Tax Allowance (See List of Promoted Activities - General).

  • Integrated Logistics Services (ILS) which comprise activities along the logistics supply chain i.e freight forwarding, warehousing, transportation and other related value-added services such as distribution, palletising, product assembly/installation, bulk breaking, consolidation, packaging/re-packaging, procurement, quality control, labeling/relabeling, testing and supply chain management
  • Cold chain facilities that provide a wide range of services including cold room, refrigerated truck and other related services such as the collection, storage and distribution of perishable locally produced food products
  • Gas and radiation sterilisation services
  1. Pioneer Status
  2. Companies undertaking these manufacturing related services are eligible for Pioneer Status with income tax exemption of 70% of the statutory income for a period of five years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company

    Applications should be submitted to MIDA.

  3. Investment Tax Allowance
  4. As an alternative to Pioneer Status, companies may apply for Investment Tax Allowance (ITA). Companies granted the ITA get an allowance of 60% on the qualifying capital expenditure incurred within five years from the date the first qualifying capital expenditure is incurred.

    Companies can offset this allowance against 70% of their statutory income in the year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised. The remaining 30% of the statutory income will be taxed at the prevailing company tax rate.

    Applications should be submitted to MIDA.

10 Incentives for Cold Chain Facilities
Incentives for Cold Chain Facilities

Companies providing the following value-added manufacturing related services are eligible for the Pioneer Status or Investment Tax Allowance (See List of Promoted Activities - General).

  • Integrated Logistics Services (ILS) which comprise activities along the logistics supply chain i.e freight forwarding, warehousing, transportation and other related value-added services such as distribution, palletising, product assembly/installation, bulk breaking, consolidation, packaging/re-packaging, procurement, quality control, labeling/relabeling, testing and supply chain management
  • Cold chain facilities that provide a wide range of services including cold room, refrigerated truck and other related services such as the collection, storage and distribution of perishable locally produced food products
  • Gas and radiation sterilisation services
  1. Pioneer Status
  2. Companies undertaking these manufacturing related services are eligible for Pioneer Status with income tax exemption of 70% of the statutory income for a period of five years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company

    Applications should be submitted to MIDA.

  3. Investment Tax Allowance
  4. As an alternative to Pioneer Status, companies may apply for Investment Tax Allowance (ITA). Companies granted the ITA get an allowance of 60% on the qualifying capital expenditure incurred within five years from the date the first qualifying capital expenditure is incurred.

    Companies can offset this allowance against 70% of their statutory income in the year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised. The remaining 30% of the statutory income will be taxed at the prevailing company tax rate.

    Applications should be submitted to MIDA.

11 Incentives for Gas and Radiation Sterilisation Services
Incentives for Gas and Radiation Sterilisation Services

Companies providing the following value-added manufacturing related services are eligible for the Pioneer Status or Investment Tax Allowance (See List of Promoted Activities - General).

  • Integrated Logistics Services (ILS) which comprise activities along the logistics supply chain i.e freight forwarding, warehousing, transportation and other related value-added services such as distribution, palletising, product assembly/installation, bulk breaking, consolidation, packaging/re-packaging, procurement, quality control, labeling/relabeling, testing and supply chain management
  • Cold chain facilities that provide a wide range of services including cold room, refrigerated truck and other related services such as the collection, storage and distribution of perishable locally produced food products
  • Gas and radiation sterilisation services
  1. Pioneer Status
  2. Companies undertaking these manufacturing related services are eligible for Pioneer Status with income tax exemption of 70% of the statutory income for a period of five years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company

    Applications should be submitted to MIDA.

  3. Investment Tax Allowance
  4. As an alternative to Pioneer Status, companies may apply for Investment Tax Allowance (ITA). Companies granted the ITA get an allowance of 60% on the qualifying capital expenditure incurred within five years from the date the first qualifying capital expenditure is incurred.

    Companies can offset this allowance against 70% of their statutory income in the year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised. The remaining 30% of the statutory income will be taxed at the prevailing company tax rate.

    Applications should be submitted to MIDA.

12 Principal Hub (PH)
Definition of Principal Hub

A locally incorporated company that uses Malaysia as a base for conducting its regional and global businesses and operations to manage, control and support its key functions including management of risks, decision making, strategic business activities, trading, finance, management and human resource.

Eligibility Criteria
  • Locally incorporated
  • Paid-up capital of more than RM2.5 million
  • Carry out at least three qualifying services
Facilities Accorded To Principal Hub
  • Facilitation under FZ/LMW
  • Foreign Exchange Administration flexibilities
  • Expatriates Post
13 Representative Offices and Regional Offices
Definition

A Representative Office/Regional Office of a foreign company/ organisation in the manufacturing and services sector is an office which is established in Malaysia to perform permissible activities for its head office/principal. The Representative Office/ Regional Office does not undertake any commercial activities and only represents its head office/principal to undertake designated functions. The Representative Office's/ Regional Office's operation is completely funded from sources outside Malaysia. The Representative Office/ Regional Office is not required to be incorporated under the Companies Act 1965. The setting up of a Representative/Regional Office requires the approval by the Government of Malaysia.

Representative Office

A Representative Office is an office of a foreign company/ organisation approved to collect relevant information on investment opportunities in the country especially in the manufacturing and services sector, enhance bilateral trade relations, promote the export of Malaysian goods and services and carry out research and development (R&D).

Regional Office

A Regional Office is an office of a foreign company/organisation that serves as the coordination centre for the company's/ organisation's affiliates, subsidiaries and agents in South-East Asia and the Asia Pacific. The Regional Office established is responsible for the designated activities of the company/ organisation within the region it operates.

Activities Allowed

The approved Representative/Regional office is established to perform the following permissible activities for its head office or principal:

  • Gathering and analysis of important information or undertaking feasibility studies on investment and business opportunities in Malaysia and the region;
  • Planning of business activities;
  • Identifying sources of raw materials, components or other industrial products;
  • Undertake research and product development;
  • Act as a coordination centre for the corporation's affiliates, subsidiaries and agents in the region
  • Other activities which will not result directly in actual commercial transactions
Activities Not Allowed

However, an approved representative office/regional office is not allowed to carry out the following activities:

  • Be engaged in any trading (including import and export), business or any form of commercial activity
  • Lease warehousing facilities; any shipment/transhipment or storage of goods must be carried out through a local agent or distributor
  • Sign business contracts on behalf of the foreign corporation or provide services for a fee
  • Participate in the daily management of any of its subsidiaries, affiliates or branches in Malaysia
Eligibility Criteria
  • The proposed operational expenditure of the RE/RO must be at least RM300,000 per annum.
  • The RE/RO should be financed by funds emanating from sources outside Malaysia.
Duration of Establishments
  • Company and Others (including non–profit organisations not relating to trade)
  • Minimum of two years depending on the merits of each case.

  • Government and Trade Association
  • Duration is based on the requirement of the applicant.

As representative/regional offices do not have issued capital in Malaysia, they are not subject to any equity condition.

Expatriate Employment

A Representative office/Regional office will be given expatriate post and the number allowed depends on the functions and activities of the Regional Office/Representative Office. Expatriates will only be considered for managerial and technical posts.

The proposed expatriate should be currently employed by the applicant company or its subsidiary or within the group. An expatriate working in a Representative Office is subject to normal income tax. However, an expatriate working in a Regional Office is taxed only on the portion of their chargeable income attributed to the number of days that they are in the country.

Applications for the establishment of Representative/Regional offices and expatriate posts should be submitted to MIDA.

14 Incentives for Providers of Industrial Design Services In Malaysia
Incentives for Providers of Industrial Design Services In Malaysia

To promote creativity and innovation that results in higher value add, providers of industrial design services are eligible for Pioneer Status with income tax exemption of 70% of the statutory income for a period of five years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company.

The industrial design services provided are meant for the purpose of mass production.

Applications received by 31 December 2016 are eligible for this incentive.

Application should be submitted to MIDA.

15 Incentives for Less Developed Areas
Incentives for Less Developed Areas

Income Tax Exemption of 100% up to 15 years of assessment (5+5+5) commencing from the first year of assessment the company derives statutory income. The company must comply with the conditions and achieve the Key Performance Index (KPIs) for each addtional 5 years.

Or

Income Tax Exemption equivalent to 100% of qualifying capital expenditure (ITA) incurred within a period of 10 years. The allowance can be offset against 100% of statutory income for each assessment year. Unutilised allowances can be carried forward until fully absorbed. The company must comply with the conditions and achieve the KPIs for additional 5 years.

Eligibility Criteria

  • A company incorporated under the Companies Act, 1965
  • Existing company expanding its operation into the less developed areas; or Newly established company
  • The company is to undertake its manufacturing or services activities in the less developed areas that will lead to substantial creation of employment and rural development
  • Complies with other conditions specified by the Minister of Finance including value added, local employment and Managerial, Technical and Supervisory Staff Index (MTS Index).

Applications received by MIDA from 1 January 2015 until 31 December 2020 is elogible to be considered for this incentive.

Application should be submitted to MIDA.

16 Incentives for Industrial Area Management
Incentives for Industrial Area Management

100% tax exemption on statutory income for 5 years starting from the date the company commences its activities.

Eligibility Criteria

  • The Industrial Estate must be gazetted by the State Authority as an industrial land
  • A newly established company or existing company appointed by a Local Authority must have an agreement on the management of Industrial Estates
  • The company undertakes the management of an existing Industrial Estate specified by the Local Authority.
  • A company incorporated under the Companies Act, 1965.
  • The company must be approved/licensed by a Local Authority
  • The company must be self-funded
  • The company must undertake the management, upgrading and maintenance actvities within the Industrial Estates.
  • The company must have commenced its operation not later than one (1) year from the date of application received by MIDA.

Applications received by MIDA from 1 January 2015 until 31 December 2017 is eligible to be considered for this incentive.

Application should be submitted to MIDA.

17 Incentives for Independent Accredited Conformity Assessment Body (ICAB)

An Independent Accredited Conformity Assessment Body is defined by the Department of Standards Malaysia as "a body that has been acrredited by the Department of Standards Malaysia, or any other acrreditation bodies that are International Laboratory Accreditation Cooperation (ILAC) or International Accreditation Forum (IAF) signatory in accordance with specific criteria, procedures and requirements to operate, on a continuing basis, as a conformity assessment body".

ICAB is a company that offers independent conformity assessment services to its clients to test their products, materials, systems or services for conformance to international specifications or safety standards and other conformities.

Incentives for Independent Accredited Conformity Assessment Body (ICAB)

For A New ICAB

  • Income Tax Exemption of 100% on statutory income for five (5) years, effective from the first income received by the company

Or

  • Income Tax Exemption equivalent to 60% of qualifying capital expenditure (ITA) incurred within a period of five (5) years from the date of the first qualifying capital expenditure. The allowance can be offset against 100% of statutory income for each assessment year. Unutilised allowances can be carried forward until fully absorbed.

For An Existing ICAB

  • Income Tax Exemption equivalent to 60% of qualifying capital expenditure (ITA) incurred within a period of five (5) years from the date of the first qualifying capital expenditure. The allowance can be offset against 100% of statutory income for each assessment year. Unutilised allowances can be carried forward until fully absorbed.

Applications received by MIDA from 1 January 2016 until 31 December 2018 is eligible to be considered for this incentive.

Claims should be submitted to IRB.

18 Other Incentives

This section covers other incentives not mentioned elsewhere and may be applicable to the following sectors: manufacturing, agriculture, aerospace, tourism, environmental management, research and development, training, information and communication technology, Approved Service Projects and manufacturing related services.

Industrial Building Allowance

An Industrial Building Allowance (IBA) is granted to companies incurring capital expenditure on the construction or purchase of a building that is used for specific purposes, including manufacturing, agriculture, mining, infrastructure facilities, research, Approved Service Projects and hotels that are registered with the Ministry of Tourism. Such companies are eligible for an initial allowance of 10% and an annual allowance of 3%. As such, the expenditure can be written off in 30 years.

Claims should be submitted to IRB.

Industrial Building Allowance for Buildings in MSC Malaysia

To encourage the construction of more buildings in Cyberjaya for use by MSC Malaysia status companies, IBA for a period of 10 years will be given to owners of new buildings occupied by MSC Malaysia status companies in Cyberjaya. Such new buildings include completed buildings but are yet to be occupied by MSC Malaysia status companies.

Claims should be submitted to IRB.

Deduction of Audit Fees

To reduce the cost of doing business and enhance corporate compliance, expenses incurred on audit fees by companies are deemed as allowable expenses for deduction in the computation of income tax.

Claims should be submitted to IRB.

Double Deduction on Quality Accreditation

Private heathcare facility which registered as the member of Malaysia Healthcare Travel Council (MHTC) is entitled to enjoy the double deduction incentive on the expenditures incurred for the purpose of obtaining quality accreditation from the following quality accreditation bodies/organisations:-

  • Joint Commission International Accreditation (JCIA)
  • Malaysian Society for Quality in Health (MSQH)
  • CHKS Accreditation Unit
  • The Australian Council on Health Care Standards (ACHS)
  • Accreditation Canada

Claims should be submitted to IRB.

Tax Incentives for Venture Capital Industry

Generally, venture capital companies (VCC) is eligible for income tax exemption for 10 years subject to the investment condition as follows:

  1. at least 50% of funds invested in venture companies must be in seed capital; or
  2. at least 70% of funds invested in venture companies must be in start-up or early stage financing.

To stimulate and further promote the funding of venture companies, VCCs investing in venture companies with at least 30% of its funds in seed capital, start-up or early stage financing are eligible for income tax exemption for five years. This incentive is effective for applications received by the Securities Commission from 30 August 2008 until 31 December 2013.

Claims should be submitted to IRB.

Tax Incentive on Costs of Dismantling and Removing Assets

Costs of dismantling and removing assets including plant and machinery as well as restoring the site where the asset was located do not qualify for allowance under the Schedule 3, Income Tax Act 1967 since this expenditure is not deemed as cost of the asset. However, Financial Reporting Standards 116 stipulates that the cost of an asset includes the estimated cost required to be incurred relating to the obligation to dismantle and remove the asset and to restore the site on which the asset was located.

Therefore, to streamline the tax treatment under the Income Tax Act 1967 and FRS 116, a special provision is introduced in Schedule 3, Income Tax Act 1967 to provide for balancing allowance* on the cost of dismantling and removing asset including plant and machinery as well as restoring the site where the asset was located, subject to the following conditions:

  • The eligibility of such treatment only applies where the obligation to carry out works on dismantling and removing the plant and machinery as well as restoring the site is provided under the written law or agreement; and
  • Such plant and machinery is not allowed to be used by that person in another business or the business of another person.

Applications are eligible for the incentive with effect from the Year of Assessment 2009.

Claims should be submitted to IRB.

* The total balancing allowance is determined by adding the cost of dismantling and removing the plant and machinery as well as restoring the site to the balance of expenditure on plant and machinery at the time of the disposal of the asset.

Incentive for Acquiring Proprietary Rights

Capital expenditure incurred in acquiring patents, designs, models, plans, trade marks or brands and other similar rights from foreigners qualify as a deduction in the computation of income tax. This deduction is given in the form of an annual deduction of 20% over a period of five years.

Claims should be submitted to IRB.

Tax Incentives for Small and Medium Enterprises to Register Patents and Trademarks

In line with the Government's objective to promote innovation and intellectual property development among small and medium enterprises (SME), expenses incurred in the registration of patents and trademarks in the country will be allowed as a deduction for the purpose of income tax computation.

Such registration expenses include fees or payment made to patent and trade marks agents registered under the Patents Act 1983 and the Trade Marks Act 1976.

The definitions for the purpose of this tax incentive are as follows:

  1. Companies as defined under paragraph 2A and 2B, Schedule 1, Income Tax Act 1967
  2. Manufacturing industries, manufacturing related services industries and agro-based industries
    • Enterprise with full-time employees not exceeding 150 persons; or with annual sales turnover not exceeding RM25 million
  3. Services industries, primary agriculture and information & communication technology (ICT)
    • Enterprise with full-time employees not exceeding 50 persons; or with annual sales turnover not exceeding RM5 million

This is effective from the year of assessment 2010 until the year of assessment 2014.

Tariff Related Incentives
  1. Exemption from Import Duty on Raw Materials/Components
  2. Full exemption from import duty can be considered for raw materials/components, regardless of whether the finished products are meant for the export or domestic market.

    Where the finished products are for the export market, full exemption from import duty on raw materials/components is normally granted, provided the raw materials/components are not produced locally.

    Where the finished products are for the domestic market, full exemption from import duty on raw materials/components that are not produced locally can be considered. Full exemption can also be considered for raw materials and components if the finished products are not subject to any import duty.

    Applications should be submitted to MIDA under PC2.

  3. Exemption from Import Duty on Imported Medical Devices for Purpose of Kitting
  4. To encourage local manufacturers of medical devices to kit their products to add value as well as to enhance their competitiveness, full import duty exemption is given on medical devices that are imported for the purpose of kitting or producing complete procedural sets, provided these medical devices are not manufactured locally.

    Applications should be submitted to MIDA.

  5. Exemption from Import Duty on Machinery and Equipment
  6. It is the policy of the government not to impose taxes on machinery and equipment used directly in the manufacturing process and not produced locally. Most categories of machinery and equipment are therefore, not subject to import duties. In cases where the imported machinery and equipment are taxable but are not available locally, full exemption is given on import duty.

    Applications should be submitted to MIDA under SPM1.

  7. Exemption from Import Duty for Outsourcing Manufacturing Activities
  8. To reduce the cost of doing business and enhance competitiveness, owners of Malaysian brands with at least 60% Malaysian equity ownership who outsource manufacturing activities are eligible for:

    1. Import duty exemptions on raw materials and components used in the manufacturing of finished products by their contract manufacturers locally or abroad.
    2. Import duty exemptions on semi-finished goods from their contract manufacturers abroad, to be used by their local contract manufacturers to manufacture the finished products.

    Applications should be submitted to Ministry of Finance.

  9. Exemption from Import Duty for Maintenance, Repair and Overhaul (MRO) Activities
  10. Aerospace companies undertaking maintenance, repair and overhaul activities, qualify for import duty exemption on raw materials, components, machinery and equipments. These are subject to each importation to be accompanied by certificates of parts and components issued by one of the following original equipment manufacturers (OEM):

    1. FAA Form 8130-3 from the United States of America
    2. EASA Form 1 from the European Union
    3. Certificate of Compliance
    4. Certificate of Conformance
    5. Certificate from vendors
    6. Distributor certificate

    Applications should be submitted to the Ministry of Finance.

  11. Drawback on Import Duty and Excise Duty
  12. Under Section 99 of the Customs Act 1967 and Section 19 of the Excise Act 1976, a drawback on import duty and excise duty that have been paid may be claimed by a manufacturer if the parts, raw materials or packaging materials are used in the manufacture of goods for export within a year based on conditions stipulated in the Acts.

    Excise duties are imposed on a selected range of goods manufactured in Malaysia. Goods which are subject to excise duties include intoxicating liquor, cigarettes containing tobacco, motor vehicles, playing cards and mahjong tiles.

    The movement of goods from the principal customs area or licensed premises (for goods subject to excise duty) for use in the manufacture of other products by a factory in a free industrial zone (FIZ) or licensed manufacturing warehouse (LMW) or the islands of Langkawi, Labuan and Tioman is considered as exports from Malaysia.

    Applications should be made to the nearest Royal Malaysian Customs Department office where its factory is located.

Incentive for the Use of Environmental Protection Equipment

Companies using environmental protection equipment receive an initial allowance of 40% and an annual allowance of 20% on the capital expenditure incurred on such equipment. Thus, the full amount can be written off in three years.

Claims should be submitted to IRB.

Donations for Environmental Protection

Donations to an approved organisation exclusively for the protection and conservation of the environment qualify for single deduction.

Claims should be submitted to IRB.

Incentive for Employees' Accommodation

Buildings used for employees for the purpose of living accommodation in a manufacturing operation, an Approved Service Project, hotel or tourism business, are eligible for special Industrial Building Allowance of 10% of the expenditure incurred on the construction/purchase of the building for 10 years.

Claims should be submitted to IRB.

Incentives for Employees' Child Care Facilities

Expenditure incurred for the construction/purchase of buildings for the purpose of providing child care facilities for employees are eligible for a special Industrial Building Allowance of 10% for 10 years.

A single deduction also applies to gifts in kind and cash to provide and maintain child care centres for the benefit of employees.

Claims should be submitted to IRB.

19 Incentives for MSC Malaysia

The MSC Malaysia is modeled to be a world-class hub for the development and nurturing of the nation's information and communications technology (ICT) industry. It provides a perfect environment for companies wanting to create, distribute and employ multimedia products and services.

MSC Malaysia status is the recognition granted by the Government of Malaysia through the Multimedia Development Corporation (MDeC) to companies that participate and undertake ICT activities in the MSC Malaysia. Companies with MSC Malaysia status enjoy a set of incentives and benefits that is backed by the Government of Malaysia's Bill of Guarantees.

Main Incentives for MSC Malaysia Status Company

MSC Malaysia status multimedia companies operating in MSC Malaysia Cybercities or Cybercentres are eligible for the following incentives/facilities:

  1. Pioneer Status with income tax exemption of 100% of the statutory income for a period of 10 years or Investment Tax Allowance of 100% on the qualifying capital expenditure incurred within a period of five years to be offset against 100% of statutory income for each year of assessment.
  2. Eligibility for R&D grants (for majority Malaysian-owned MSC Malaysia Status companies)

Applications for MSC Malaysia Status should be submitted to MDeC.

Other Benefits

  • Duty-free import of multimedia equipment
  • Intellectual property protection and a comprehensive framework of cyberlaws
  • No censorship of the Internet
  • World-class physical and IT infrastructure
  • Globally competitive telecommunication tariffs and services
  • Consultancy and assistance by the Multimedia Development Corporation to companies within the MSC Malaysia
  • High quality, planned urban development
  • Excellent R&D facilities
  • Green and protected environment
  • Import duty, excise duty and sales tax exemption on machinery, equipment and materials.

For further information, visit www.mscmalaysia.my

20 Incentives for Information and Communication Technology (ICT)
Incentives for the Use of ICT
  1. Accelerated Capital Allowance
  2. Companies are eligible for Accelerated Capital Allowance (ACA) that provides an initial allowance of 20% and an annual allowance of 40% for expenditure incurred in acquiring computers and information technology assets, including software. Effective for the Year of Assessment 2009 to the Year of Assessment 2013, the period to claim ACA on expenses incurred on ICT equipment including computer and software is accelerated from two years to one year.

    The cost of developing websites is allowed as an annual deduction of 20% for a period of five years.

    Claims should be submitted to the IRB.

  3. Deduction of Operating Expenditure
  4. Companies enjoy a single deduction of operating expenditure including payments to consultants related to IT usage for improving management and production processes.

    Claims should be submitted to IRB.

  5. Tax Exemption on the Value of Increased Exports
  6. Companies in the ICT sector can apply for a tax exemption on their statutory income equivalent to 50% of the value of increased exports.

    Claims should be submitted to IRB.

21 Incentives for the Shipping and the Transportation Industry
Tax Exemption for Shipping Operation

The income of a shipping company derived from the operation of Malaysian ships is 70% exempted from tax from Year of Assessment 2012. This incentive only applies to residents. A "Malaysian Ship" is defined as a sea-going ship registered as such under the Merchant Shipping Ordinance 1952 (Amended), other than a ferry, barge, tugboat, supply vessel, crew boat, lighter, dredger, fishing boat or other similar vessels.

The Income of any person derived from exercising an employment on board a "Malaysian Ship" is exempted from tax. Income received by non-residents from the rental of ISO containers to Malaysian shipping companies is also exempted from income tax.

Claims should be submitted to IRB.

Sebelumnya

Liberalisasi Sektor Perkhidmatan

Seterusnya

Peluang Pelaburan

Tarikh Dikemaskini : Jumaat 17 November 2017