by FAYYADH JAAFAR / pic by BERNAMA
THE Inland Revenue Board of Malaysia (HASiL) announced today that it will terminate the special income remittance programme (PKPP), effective immediately.
HASiL said the PKPP had been introduced as part of its efforts to encourage Malaysians living abroad to bring their money back home.
However, following the announcement by the the Finance Ministry (MOF) dated December 30, 2021 regarding the improvement of tax treatment policy on foreign income, HASiL has decided to terminate the PKPP.
According to HASiL, the decision to terminate THE programme was made after taking into account the tax exemption announced by the MOF on income from foreign sources received in Malaysia by resident individuals (other than partnership income).
The same exemption is also given to dividend income from foreign sources brought in by companies and limited liability partnerships.
This exemption is subject to the conditions set out in the Income Tax (Exemption) Order to be issued under section 127 of the Income Tax Act 1967.
“However, income from other foreign sources that is not exempted and brought into Malaysia from January 1, 2022 must be reported in the Return Form for the relevant year of assessment,” HASiL said in a statement today.
As announced in Budget 2022 and allocated under the Finance Act 2021, foreign income that is still subject to tax and brought into Malaysia between Jan 1, 2022 and June 30, 2022 will be taxed at a concession rate of 3%.
After the expiry of that period, the rate of the original tax will apply according to the relevant taxpayer category.