Pricing Convertible Securities - The Malaysian Institute Of Certified ...

The Malaysian Accountant FEATURE 5Real Property Gains TaxReal Property Gains Tax (Exemption) Order 2011With effect from January 1, 2012, RPGT rates have been revisedas follows:-RateDisposal made within 2 years after 10%date of acquisitionDisposal made in the 3rd, 4th or 5th year 5%after date of acquisitionDisposal made after 5 years from 0%the date of acquisitionThe revised rates are applicable to chargeable gain arising from thedisposal of chargeable assets on or after January 1, 2012 andapply to companies, individuals, partnerships, bodies of personsand corporation sole.Stamp DutyStamp Duty (Exemption) (No. 3) Order 2011The Order, which comes into operation on January 1, 2012,grants stamp duty exemption for any loan agreement executedbetween a purchaser andi. a bank, financial institution, insurance company or cooperativesociety;ii. an employer under an employee housing loan scheme; oriii. PR1MA Corporation Malaysiarelating to the purchase of a residential property from PR1MACorporation Malaysia.The Sale and Purchase Agreement must be executed on orafter January 1, 2012 but not later than December 31, 2016. Theexemption is given once to an individual Malaysian citizen who iseligible to purchase residential property costing not more thanRM300,000 under the Perumahan Rakyat 1Malaysia programme.Stamp Duty (Exemption) (No. 4) Order 2011The Order, which comes into operation on January 1, 2012,grants stamp duty exemption for the instrument of agreement fora loan or financing pursuant to a micro financing scheme approvedby the National Small and Medium Enterprise DevelopmentCouncil, for an amount not exceeding RM50,000 between aborrower and a participating bank or financial institution. Theinstrument of agreement must be executed on or after January 1,2012 in order to qualify for the exemption.Stamp Duty (Exemption) (No. 5) Order 2011The Order, which comes into operation on January 1, 2012,grants stamp duty exemption for all loan or financing instruments(executed on or after January 1, 2012) in relation to the ProfessionalService Fund for an amount not exceeding RM50,000 between aborrower and Bank Simpanan Nasional.Public RulingsPublic Ruling 8/2011 (PR8/2011) - Foreign NationalsWorking In Malaysia - Tax TreatmentThe PR explains the tax treatment of employment income derivedby foreign nationals exercising employment in Malaysia. The PR,which is effective from the year of assessment 2011, states thefollowing:• A foreign national working in Malaysia is liable to tax underMalaysian domestic law in respect of his employment incomederived from Malaysia.• Subsection 13(2) of the ITA provides that employment incomeis deemed derived from Malaysia when the employment isexercised in Malaysia. Since the phrase exercisingemployment is not defined in the ITA, it is generally understoodto mean that an employee is exercising his employment at theplace where he is physically present when performing theactivities for which he is deriving employment income.• If the income arises for any period during which the employeeperforms duties outside Malaysia and if these duties areincidental to the exercise of his employment in Malaysia, thensuch income is also subject to tax (for further details, refer toPublic Ruling No.1/2011 – Taxation of Malaysian EmployeesSeconded Overseas).• The tax rates applicable to foreign nationals would depend ontheir residence status, which is determined by the physicalpresence of the foreign national in Malaysia in the calendar yearconcerned. Resident individuals are eligible to claim personalreliefs and are taxed at scale rates whereas non-residentindividuals are not entitled to any personal reliefs and are taxedat a flat rate of 26%.• Pursuant to Paragraph 21, Schedule 6 of the ITA, the incomeof a non-resident individual from an employment exercised byhim in Malaysia will be exempt from tax under the followingscenarios:- Where the employee has exercised his employment inMalaysia for a period or periods which together do notexceed 60 days in a basis year for a year of assessment;- Where the employee exercised his employment in Malaysiafor a continuous period (not exceeding 60 days) whichoverlaps the basis years for two successive years ofw w w . m i c p a . c o m . m y M a r c h - A p r i l 2 0 1 2