Malaysia: FAQs about tax deduction for landlords offering reduced rent (COVID-19)

Malaysia: FAQs about tax deduction for landlords

The Malaysian Inland Revenue Board issued a set of updated “frequently asked questions” (FAQs) on the special tax deduction available for landlords that provide a rental reduction of at least 30% to small and medium-sized enterprise (SME) tenants and regarding business premises rented to non-SMEs—support offered in response to the coronavirus (COVID-19) pandemic.

1000

Related content

For background, read TaxNewsFlash

The FAQs provide:

  • A qualifying person will be allowed a special tax deduction in an amount equal to the rental reduction granted to SME tenants and non-SME tenants as follows:
    • For SME tenants—the period of rental reduction is from April 2020 to June 2021.
    • For non-SME tenants—the period of rental reduction offered is from January 2021 to June 2021.
  • For purposes of claiming the special tax deduction, an SME status certificate issued up to 30 June 2021 can be used as verification of the tenants' SME status.
  • The tax authority is currently updating the worksheet (form) to be used to claim the special tax deduction.


KPMG observation

The updated FAQs removed a question regarding whether a qualifying person is eligible to claim the special tax deduction if the premises are rented to a related company. An official with the tax authority informally clarified that the incentive applies as long as the tenant's SME status is supported by the SME status certificate, and would not affect the landlord's eligibility to claim this special tax deduction even if the business premise is rented to a related company.

Read a March 2021 report prepared by the KPMG member firm in Malaysia

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. 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. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Want to do business with KPMG?

 

loading image Request for proposal