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TAX LAW
Related Topics : Corporate Tax Law . Estate Tax Law . Gift Tax Law . Income Tax Law . Property Tax Law . Sales Tax . Service Tax .


Taxation in Malaysia

WHAT IS TAX LAW ?

Tax law is found in many places - tax law is generated by the federal government, state government as well as counties, cities, and other municipalities. The variety of taxes that everyone faces is staggering - tax law affects almost every aspect of your life.

INTRODUCTION

Generally, all income of companies and individuals accrued in, derived from or remitted to Malaysia are liable to tax. However, income remitted to Malaysia by resident companies, non-resident companies (other than companies carrying on the business of banking, insurance, air and sea transportation) and nonresident individuals are exempted from tax.

Apart from income tax, there are other direct taxes such as real property gains tax, and indirect taxes such as sales tax, service tax, excise duty and import duty.

Currently, income tax is assessed on the income earned in the preceding year according to the Official Assessment System.

As a measure to modernize and streamline the tax administration system, the assessment of income tax will be changed to the current year assessment from the year 2000. The present Official Assessment System will be changed to the Self-Assessment System in stages as follows:-

Group
Year of Implementation
Companies  2001
Business, partnerships and cooperatives 2003
Salaried group 2004


To facilitate the changeover, all income received in 1999 will be waived from income and losses incurred in 1999 will be allowed to be carried forward.

Agreement for the Avoidance of Double Taxation

Agreements for the Avoidance of Double Taxation provide for the avoidance of incidence of double taxation on income such as business profits, dividends, interest and royalties that are derived in one country and remitted to another country. To-date, Malaysia has signed such tax treaties with the following countries (by alphabetical order):

Albania 
Argentina
(limited to shipping and
air transport)
Australia 
Austria 
Bangladesh 
Belgium 
Canada 
China
Czech Republic
Denmark 
Egypt
Fiji 
Finland 
France 
Germany 
Hungary 

India 
Indonesia 
Iran 
Italy 
Japan 
Jordan 
Korea, Republic of Kuwait
Malta 
Mauritius 
Mongolia 
Netherlands 
New Zealand 
Norway 
Pakistan 
Papua New Guinea 
Philippines 
Poland 
Romania 

Russia
Saudi Arabia (limited to shipping and air transport)
Singapore 
Sri Lanka 
Sudan 
Sweden 
Switzerland 
Thailand 
Turkey 
United Arab Emirates 
United Kingdom 
United States of America (limited to shipping and air transport)
Vietnam, Socialist 
Zimbabwe 



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Last Updated : Monday, 23 July 2001 - 03:53:10 PM EDT©1999-2000
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