Malaysia legislation
Section 6
Section 6
The principal Act is amended by inserting after section 6B the following section:
“Tax rebate on fees 6C.
Income tax charged for each year of assessment upon the chargeable income of an individual shall be rebated in respect of any fee paid to the Government in the basis year for that year of assessment pursuant to any order made under section 3 of the Fees Act 1951 [Act 209], for the issue of an Employment Pass, Visit Pass (Temporary Employment)
or Work Pass before any set off is made under section 110
and any credit is allowed under section 132 or 133:
Provided that where the rebate exceeds the income tax charged (before any such rebate) for any year of assessment, the excess shall not be paid to that individual and shall not be available as a credit to set off his tax liability for any subsequent year of assessment.”.
Amendment of section 25 7.
Section 25 of the principal Act is amended—
(a)
in subsection (3) by substituting for the word “eleven”
wherever it appears the word “five”;
(b)
in subparagraph (4)(a)(i) by substituting for the word
“nine” wherever it appears the word “five”; and
(c)
in paragraphs (4)(b) and (4)(c) and subsection (5) by substituting for the word “eleven” wherever it appears the word “five”.
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Amendment of section 27 8.
Section 27 of the principal Act is amended—
(a)
in paragraphs (2)(b) and (2)(c) by substituting for the word “eleven” wherever it appears the word “five”; and
(b)
in subsection (3) by substituting for the word “eleven”
wherever it appears the word “five”.
Amendment of section 34 9.
Section 34 of the principal Act is amended—
(a)
in paragraph (4)(a) by substituting for the word “seventeen”
the word “nineteen”;
(b)
by deleting the word “and” at the end of paragraph (6)(i);
(c)
by substituting for the full stop at the end of paragraph
(6)
the word “; and”; and
(a)
by substituting for paragraph (1)(d) the following paragraph:
“(d) thereafter, by any deduction falling to be so made pursuant to subsection (8), (9), (10) or (11).”;
(b)
in subsection (6A) by substituting for the words “or manuscript” the words “, manuscript or painting”; and
(c)
by inserting after subsection (8) the following subsections:
“(9) There shall be deducted pursuant to this subsection from the aggregate income of a relevant person who is an individual for the relevant year reduced by any deduction for that year in accordance with subsection (1) an amount equal to any gift of money or contribution in kind (the value to be determined by the relevant local authority) made by him in the basis year for that year for the provision of facilities in public places for the benefit of disabled persons.
(d)
by inserting after paragraph (6)(j) the following paragraph:
“(k) an amount equal to the expenditure incurred by the relevant person in the relevant period for sponsoring any arts or cultural activity approved by the Ministry of Culture, Arts and Tourism:
Provided that the amount deducted shall not exceed two hundred thousand ringgit.”.
Amendment of section 39 10.
Subsection 39(1) of the principal Act is amended by inserting after paragraph (g) the following paragraph:
“(h) any sum paid by way of a bonus to an employee in excess of two twelfths of his wages or salary;”.
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Finance
Amendment of section 44 11.
Section 44 of the principal Act is amended—
(10)
There shall be deducted pursuant to this subsection from the aggregate income of a relevant person who is an individual for the relevant year reduced by any deduction for that year in accordance with subsection (1) an amount equal to any gift of money or the cost or value (as certified by the Ministry of
Health) of any gift of medical equipment made by him in the basis year for that year to any health care facility approved by that Ministry, and that amount shall not exceed twenty thousand ringgit.
(11)
There shall be deducted pursuant to this subsection from the aggregate income of a relevant person for the relevant year reduced by any deduction for that year in accordance with subsection (1) an amount equal to the value of any gift of painting (to be determined by the National Art Gallery or any state art gallery)
made by him in the basis year for that year to the
National Art Gallery or any state art gallery.”.
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Amendment of section 48 12.
Section 48 of the principal Act is amended by substituting for paragraph (3)(a) the following paragraph:
“(3)(a) in respect of a child over the age of eighteen years and is receiving instruction at any educational establishment mentioned therein or is serving under articles or indentures with a view to qualifying in a trade or profession (in this subsection referred to as receiving further education)
but not including a child receiving instruction at any school, then, if that individual satisfies the Director
General that he has directly expended in that basis year for that year of assessment a sum or sums exceeding the ordinary deduction on the maintenance of that child or in making any payment in connection with that child’s further education, there shall be allowed in substitution for the ordinary deduction, a deduction equal to the total sum or sums so expended but not exceeding—
(i)
four times the amount of the ordinary deduction if that child is receiving further education in
Malaysia;
(ii)
four times the amount of the ordinary deduction if that child commenced receiving further education in a place outside Malaysia at any time in the basis year for the year of assessment 1994 or at any time in the basis year for any prior year of assessment; or
(iii)
twice the amount of the ordinary deduction if that child commenced receiving further education in a place outside Malaysia beginning from 1
January 1994 to 16 October 1997.”.
Amendment of section 60 13.
Section 60 of the principal Act is amended—
(a)
by substituting for the full stop at the end of paragraph
(2)
a colon;
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Finance
(b)
by inserting after paragraph (2)(c) the following proviso:
“Provided that—
(i)
where the insurer also carries on life re-insurance business, the life re-insurance business shall be a separate source from life business and shall be treated as a general business; or
(ii)
where the insurer also carries on inward life re-insurance business, the inward life re-insurance business shall be a separate source from life business and shall be treated as a general business;”;
(c)
by inserting after the proviso to paragraph (2)(c) the following paragraph:
“(d) where an insurer carries on only life re-insurance business, the life re-insurance business shall be treated as a general business.”;
(d)
in subsection (3) by inserting after the words “life fund”
the words “, other than income arising from life re-insurance business,”;
(e)
in subparagraph (3A)(a)(iii) by inserting after the words
“life fund” the words “, other than the surplus from life re-insurance business,”;
(f)
in subparagraph (3A)(b)(ii) by inserting after the words
“life fund” the words “, other than the deficit from life re-insurance business”;
(g)
in subsection (4) by inserting after the words “the life fund” the words “, other than income arising from life re-insurance business,”;
(h)
in subparagraph (4A)(a)(iii) by inserting after the words
“life fund” the words “, other than the surplus from life re-insurance business,”;
(i)
in subparagraph (4A)(b)(ii) by inserting after the words
“life fund” the words “, other than the deficit from life re-insurance business”;
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(j)
by inserting after subsection (5B) the following subsection:
“(5C) The adjusted income for the basis period for a year of assessment from the life re-insurance business of a life insurer resident for the basis year for that year of assessment shall consist of an amount arrived at by applying subsection (5) as if references therein to—
(a)
“general business of an insurer” were references to “life re-insurance business of a life insurer”;
(b)
“general policies” were references to “life re-insurance policies”; and
(c)
“reserve fund for unexpired risks” were references to “actuarial valuation reserve” ’;
(k)
by inserting after subsection (6B) the following subsection:
“(6C) The adjusted income for the basis period for a year of assessment from the life re-insurance business of a life insurer not resident for the basis year for that year of assessment shall, where that business is wholly or partly carried on in Malaysia, consist of an amount arrived at by applying subsection (6) as if references therein to—
(a)
“general business of an insurer” were references to “life re-insurance business of a life insurer”;
(b)
“Malaysian general policies” were references to
“Malaysian life re-insurance policies”; and
(c)
“reserve fund for unexpired risks” were references to “actuarial valuation reserve” ’; and
(l)
by substituting for subsection (11) the following subsection:
“(11) In this section, sections 60A and 60B—
“general business” means all insurance business which is not life business;
“general policy” means a policy other than a life policy;
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Finance
“insurer” means a person who carries on insurance business and includes a professional re-insurer;
“investments” includes any accretions thereto;
“inward re-insurance” means any re-insurance of a risk under a policy where the risk is outside Malaysia and the original insurance policy—
(a)
is issued by an insurer not resident in Malaysia but not issued by a branch in Malaysia of such insurer; or
(b)
is issued by a branch outside Malaysia of an insurer resident in Malaysia, and where any risk is in transit in Malaysia it shall be deemed to be outside Malaysia;
“inward re-insurance contract” means a Malaysian policy in respect of inward re-insurance;
“life business” has the same meaning assigned thereto under section 2 of the Insurance Act 1996 [Act 553];
“life policy” has the same meaning assigned thereto under section 2 of the Insurance Act 1996;
“Malaysian life fund” means the fund established pursuant to section 38 of the Insurance Act 1996;
“Malaysian policy” has the same meaning assigned thereto under section 2 of the Insurance Act 1996;
“offshore insurance” means insurance of a risk under a general policy where the risk is outside Malaysia and the insurance policy is issued by an insurer resident in Malaysia or by a branch in Malaysia of an insurer not resident in Malaysia, and where any risk is in transit in Malaysia it shall be deemed to be outside
Malaysia;
“offshore insurance policies” means policies issued in respect of offshore insurance;
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“policy” has the same meaning assigned thereto under section 2 of the Insurance Act 1996;
“premium” has the same meaning assigned thereto under section 2 of the Insurance Act 1996;
“re-insurance” has the same meaning assigned thereto under section 2 of the Insurance Act 1996;
“revenue account” means the revenue account lodged in respect of life business under section 87 of the Insurance
Act 1996.’.
Amendment of section 60E