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As announced under the PERMAI Package on 18 January 2021, the special tax deduction granted to taxpayers who provide a rental reduction of at least 30% to their Small and Medium Enterprise ("SME") tenants has been extended to 30 June 2021 as well as to cover business premises rented to non-SMEs.

The Malaysian Inland Revenue Board ("MIRB") has issued an updated Frequently Asked Questions ("FAQs") dated 19 February 2021 on its official website to take into account the above proposals. We are pleased to highlight below the notable updates in the FAQs

  •  A qualifying person will be eligible for a special tax deduction equivalent to the rental reduction given to SMEs and non-SMEs tenants in the following period:

Tenants

Period of Rental Reduction Offered

SMEs

April 2020 to June 2021

Non-SMEs

January 2021 to June 2021

  • For the purpose of claiming the said special tax deduction, SME Status Certificate issued by SME Corporation Malaysia up to 30 June 2021 can be used as verification of the tenants' SME status.
  •  The MIRB is still in the midst of updating the Worksheet to be completed for the special tax deduction claim, hence it has not attached the Worksheet to the FAQs. 

In addition, we note that the question on whether a qualifying person can enjoy the special tax deduction if the business premise is rented to a related company has been removed from the latest FAQs. The officer from the MIRB has verbally clarified that this incentive applies as long as the tenant's SME status is supported by the SME Status Certificate. It will not affect the landlord's eligibility to claim this special tax deduction incentive even if the business premise is rented to a related company.

Please note that the implementation of the special tax deduction incentive is subject to the gazette of the relevant Income Tax Rules.

The MIRB's updated FAQ (available in Malay language only) and our earlier Tax Whiz covering a summary of the above incentive can be accessed via the above links.

Should you have any questions or require further clarification, please do not hesitate to contact any of our Executive Directors, Directors, Associate Directors or Managers whom you are accustomed to dealing with or who are responsible for the tax affairs of your organisation.

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

Tai Lai Kok
Executive Director
Head of Tax 

For more information on our core service offerings, please contact:

Petaling Jaya Office

Tai Lai Kok
Executive Director -
Head of Tax and Head of Corporate Tax
ltai1@kpmg.com.my
+ 603 7721 7020

Long Yen Ping
Executive Director -
Head of Global Mobility Services yenpinglong@kpmg.com.my
+ 603 7721 7018

Bob Kee
Executive Director -
Head of Transfer Pricing
bkee@kpmg.com.my
+ 603 7721 7029

Ng Sue Lynn
Executive Director -
Head of Indirect Tax
suelynnng@kpmg.com.my
+ 603 7721 7271

Soh Lian Seng
Executive Director -
Head of Tax Dispute Resolution
lsoh@kpmg.com.my
+ 603 7721 7019

 

Outstation Offices

Penang Office

Kuching & Miri Office

Evelyn Lee
Executive Director -
Penang Tax
evewflee@kpmg.com.my
+604 238 2288 (ext. 312)

Regina Lau
Executive Director -
Kuching & Miri Tax
reglau@kpmg.com.my
+6082 268 308 (ext. 2188)

Kota Kinabalu Office

Johor Bahru Office

Titus Tseu
Executive Director -
Kota Kinabalu Tax
titustseu@kpmg.com.my
+6088 363 020 (ext. 2822)

Ng Fie Lih
Executive Director -
Johor Bahru Tax
flng@kpmg.com.my
+607 266 2213 (ext. 2514)

Ipoh Office

 

Crystal Chuah Yoke Chin
Tax Manager -
Ipoh Tax
ycchuah@kpmg.com.my
+605 253 1188 (ext. 320)