What is the threshold for personal income tax in Malaysia? Are there any tax-exempt items? What is the tax rate

Malaysian personal income tax thresholds

Malaysian personal income tax is taxed at 5-level progressive rates from 19% to 28%. Since 2004, the personal income tax declaration and tax payment system has been implemented. The starting point for personal income tax is 50,000 ringgit

? Malaysia’s preferential policies for tax items

1. For high-tech companies, those engaged in scientific research and development, and those establishing electronic information and communication technology enterprises within the "Multimedia Super Corridor", they will be exempted from paying income tax for five years. ?

2． The current corporate income tax rate is 28% (for those engaged in oil exploration and smelting, the corporate income tax rate is 38%). For foreign-invested enterprises that have obtained "emerging industry status" qualifications, only 30% of the company's operating profits will be subject to income tax within five years from the date of production (referring to the day when daily output reaches 30% of the maximum output).

3． Institutions established to carry out science and technology transfer and training will be exempted from paying income tax for 10 years. For foreign enterprises that transfer advanced technology to domestic companies or individuals in Maldives, their technology transfer fees are exempt from income tax. Strategic projects involving major national interests and having a significant impact on national economic development, as well as machinery and equipment and their parts that have been prioritized for production and development are exempted from income tax. Parts and components are exempt from corporate income tax for 10 years. ?

4. If you invest in the environmental protection industry, 70% of the company's operating profits will be exempted from income tax within 5 years. However, those engaged in afforestation will be exempted from corporate income tax for 10 years.

5. Enterprises that invest in grain production approved by the Ministry of Finance (including kenaf, vegetables, fruits, medicinal plants, spices, aquatic products and livestock breeding such as cattle and sheep) are exempt from paying corporate income tax for 10 years. Those who export fresh and dried fruits, flowers and dried flowers, ornamental plants and ornamental fish are exempt from paying income tax equivalent to 10% of their operating profits.

6． For export-oriented enterprises, if their export volume increases by 30%, 10% of the increase in exports will be exempted from income tax; if their export volume increases by 50%, 15% of the increase in exports will be exempted from income tax. ?

7． For information and communication technology enterprises, 50% of their export increase is exempt from income tax. ?

8. Those who engage in luxury yacht repair services on Langkawi Island and provide luxury yacht rental services in Malaysia are exempt from paying income tax for 5 years. ?

9. Those who establish regional operating headquarters and procurement centers in Malaysia will be exempted from paying income tax for 5 years. After the expiration of the 5-year period, upon application and approval, the exemption from paying income tax can be extended for another 5 years. ?

10. Foreign-invested enterprises participating in the Malaysian Industrial Development Plan are exempt from paying income tax for five years, and their expenditures on employee training, product development testing and public property audits can be deducted from their income tax. As a supplier, if its products can reach world-class prices, quality and technical content, upon approval, they will be exempt from paying income tax for 10 years. ?

11. Raw materials and parts imported for export (export volume accounts for more than 80% of its production volume) are exempt from import taxes. Machinery and equipment that cannot be produced domestically or that can be produced but the quality or standards do not meet the requirements are exempt from import tax and sales tax. ?

12. For machinery and equipment that can be produced domestically and meet quality and standards requirements, such as those used for environmental protection, waste reuse, storage and processing of toxic and hazardous items, for research and development institutions and training, and for the planting industry, Import and sales tax exemptions are also available upon application. Imported materials and equipment used in hotel and tourist services are exempt from import and sales taxes.

13． Approved foreign-invested education and training equipment (including experimental equipment, workshops, photography studios and language laboratories, etc.) are exempt from import tax, sales tax and domestic tax (Note: Malaysia imposes restrictions on some specific domestically produced products, including cigarettes. , alcohol, playing cards, mahjong tiles and motor vehicles, etc., are subject to domestic tax). ?

14． For raw materials, parts and consumables directly used in service industry projects approved by the Ministry of Finance, if they cannot be produced domestically or can be produced but the quality or standards do not meet the requirements, they are exempt from import tax and sales tax. Locally purchased equipment and machinery are exempt from sales and excise taxes. ?

15. Relevant equipment used by enterprises located in the "Multimedia Super Corridor" will be exempt from import taxes. Infrastructure and industrial building tax exemptions. Those who build and purchase construction facilities for specific purposes (including houses used for industrial production, research and development, and employee living in approved industries) are exempted from paying 10% of the industrial construction tax in the first year, and 3% in each subsequent year. The maximum term is 30 years. Companies investing in East Malaysia and the "Eastern Corridor" are exempt from paying all infrastructure fees. Related fee exemptions. ?

16． Advertising expenses incurred to promote Malaysian products and brands can be deducted from their income tax upon application and approval

Malaysian income tax law is targeted at both legal entities and individuals. There are no special provisions for the objects, and the taxable income is calculated comprehensively according to the type of income. Income related to legal persons can be roughly divided into four types: ① operating income; ② investment income: dividends, interest, etc.; ③ asset income: leasing fees, usage fees, commissions; ④ other gains or gains of an income nature.

In 2006, resident companies adopted a proportional tax rate of 20% and 28% and implemented a tax declaration system.

The applicable tax rate for taxable income not exceeding 500,000 ringgit is 20%, and the applicable tax rate for taxable income exceeding 500,000 ringgit is 28%.

Malaysia implements a withholding tax system for non-resident companies. The withholding tax rate is 10% to 15%. Non-resident companies are subject to withholding tax on interest and royalties from Malaysia, and dividends to resident companies and non-resident companies are currently exempt from tax. There is no withholding tax on interest received by a non-resident company in extending credit to the Malaysian central government, state governments, local authorities or statutory entities. After 1983, Malaysia strengthened the withholding tax collection on non-resident contractors in the construction industry. According to the contract, the total withholding tax rate for non-resident contractors is 20% (15% for legal entities and 5% for individuals). ).