CP22 and e-CP22 in Malaysia: What Employers Need to Know When Hiring New Employees
Hiring a new employee involves more than preparing an employment contract. For employers in Malaysia, an important consideration is whether a notification must be submitted to the Inland Revenue Board of Malaysia (HASiL). Under Section 83(2) of the Income Tax Act 1967, where an employer commences to employ an individual who is, or is likely […]
RM5 Million Compensation: Capital Receipt or Taxable Business Income?
What happens when a joint venture fails, but the compensation succeeds? In Guppyunip Sdn Bhd v Director General of Inland Revenue, Guppyunip received RM7 million under a Deed of Mutual Rescission, including RM5 million described as compensation. The company argued that the payment constituted a capital receipt in consideration of relinquishing its contractual rights. The […]
Are Guarantee Fees and General Administrative Expenses Tax-Deductible?
Tax Compliance Advisory for Construction Contractors Reference: Public Ruling No. 5/2025 — Construction Contracts, Paragraphs 11.8 and 11.9 1. Overview of the Tax Treatment According to Public Ruling No. 5/2025 issued by the Inland Revenue Board of Malaysia (LHDN), two common expenses incurred by construction contractors receive different tax treatments: Expense Tax Treatment Reference Guarantee […]
Ketua Pengarah Hasil Dalam Negeri v. Sobrina Kapal Sdn Bhd
Ship Leasing and the Section 54A Shipping Tax Exemption Sobrina Kapal Sdn Bhd leased the cargo vessel M.T. Sofia to Petronas for the transportation of petroleum and claimed the shipping tax exemption under Section 54A of the Income Tax Act 1967. The claim was rejected by the Inland Revenue Board of Malaysia (IRB). The Court […]
When an Intra-Group Loan Is Not Really a Loan
Episode One: Calling It a Loan Does Not Necessarily Make It One At 9.00 p.m., Lin Bei was in his office. On the table were coffee, a loan agreement, financial statements and a piece of paper labelled “intra-group fund transfers”. Robert Zai entered with a stack of documents, while Dr Foo sat opposite Lin Bei […]