Chapter 3: Agriculture allowance, approved agricultural projects - form of cultivation of crops, animal farming, aquaculture, inland

and forest allowance fishing and any other agricultural or pastoral pursuit
- include reafforestation of timber
Agriculture allowance
Qualifying Agriculture Expenditure (QAE) Crops
- for purpose agriculture business will be given agriculture - any form of vegetable produce
allowance to set off against the adjusted income from that
agriculture business to arrive at statutory income Replanting
- replacement of the crop of any product on any area of land, to
S 4 (a) Agriculture business produce on the same area a crop of the same product
Adjusted income
- capital allowances Farm
agriculture allowances - land used for the purposes of agriculture
Statutory income
Replanting
QAE - same crop and also same area of land
capital expenditure incurred by a person - able to claim revenue deduction in arriving at the adjusted
- the clearing and preparation of land for the purposes of income
agriculture - include land clearing cost, the planting cost, and cost on
- the planting (but not replanting) of crops on land cleared for improvement work in relation to replanting
planting - replacement of cucumber with tomato remain within ambit of
- construction on a farm of a road or bridge vegetable, deduction is available
- construction on a farm on a building used for the purpose of a
business of that person which consist wholly or partly of the Business sources
working of the farm, construction on that farm of a building - oil palm and processing fresh fruit
which is provided by that person for the welfare of persons, living - two activity connected but to be treated as one business source,
accommodation for a person employed in or connection with the name agriculture business
working of that farm, farm ceased to be worked, likely to be of
little or no value to any person except in connection with the Building used in agriculture business
working of another farm - relief burden of substantial capital expenditure incurred at the
initial stage of plantation
QAE - to eligible for agricultural allowance, building used in agriculture
- cost of plant and machinery used in the farm would be given or directly as living accommodation for estate workers has satisfy
normal capital allowance in other business, it would not be part zero value
of QAE
- the land cost is excluded from the meaning of QAE New planting
- incurred QAE on planting new crops on virgin land or replace
Particulars Scope news crop on old crop of different product, purchase land from
Clearing and preparation of Terrace the land to previous owner by plant same crop, said to be carrying out new
land - combat erosion planting. He will granted agriculture allowance
- provide easy access to estate - no initial allowance are available for QAE
worker - when agriculture allowance is claimed, the person is not entitled
New planting - planting new crop of any to other allowance in respect of the same expenditure
Ex. Rubber tree – oil palm product
Vegetables - timber - replacing old crop with a crop Claim of agriculture allowances
of different product no allowance shall be made to an asset and a business of his
* nursery is not a farm - asset is transferred or transmitted in the basis period for that year,
Construction of road or bridge Include construction of drains it was not use for the purposes of the business within one month
Buildings uses in business - estate office buildings or further period as director general may allow) before that
- mills transfer or transmission took place
- godowns - at the end of the basis period for that year he was not the owner
- smoke houses of the asset or it was not in use for the purposes of the business
Living accommodation for - staff quarters
employees - temples To claim agriculture allowance
-community halls - must be the owner at the end of basis period
- QAE is in used at the end of the basis period
Disposal
Agriculture
- QAE was in use within one month before transfer agriculture charge to the past
- claim of agriculture allowance is up to date of transfer or sale
allocated on time basis a c c c C
- transferee would claim the remaining of his basis period and b
purchase consideration
- no agriculture allowance will be given during the year of disposal a. Accounting year end 31 December, 31 August
if QAE were not in use for business purpose within one month b. Qualifying agriculture expenditure
before transfer or disposal Annual allowance
Year assessment 2015
Disposal (from madam) Year assessment 2016
- if the farm/ estate is still in operation up to the date of disposal Agriculture charge 2016
then the business can claim the agriculture allowance (AA) on Election for spread back under paragraph 27
proportionate basis in the year of disposal (total amount of agriculture / year assessment, if 2 ,2 if 3,3. If
- if the farm /estate is a ceased (stop operation) to be used for more 4,4) state year assessment 2015, year assessment 2016
than one month before the date of disposal. The business is not
entitle to claim, AA in the year of disposal Need to careful with date and also year end
c. Clearing of land for cultivation
Transferor Planting of vegetable seedlings
- no of days owned before transfer x agriculture allowance Construction of bridge
365 Worker accommodation located on the farm
New planting of mango trees
Transferee Construction of labour quarter
- buyer bayar ke penjual (xde kena Mengena dengan tax) Construction of office build
- can claim remaining agriculture allowance due to the transferor
Asset # no need
- a farm used by recipient for the purpose of a business of his Land
which consists wholly or partly of the working of the farm Residential house used by a senior, manager ten kilometre from
- a building which is used by the recipient for the purposes of that Farm
business and is adjacent to or closely n the vicinity or that farm or Replanting of vegetable seedlings
another arm of his forming part of that business
Disposal
*boleh claim satu tahun, contoh first owner dia claim 8 month, - amount abaikan
next owner can claim 4 month even dia punya end of year tinggal - tengok tarikh or month kadang xsampai 1 year dia disposal
lagi 3 month. Can claim balance in full - owner lama claim 5 month
- owner baru can claim 7 month even year end dia just 6 bulan
Agriculture charge - example year end December old
- balancing charge May disposal
Will arise in this circumstance Year end November new
Old boleh claim until 5 month, balance 7 month new can claim.
Disposal within 5 years Year end was November. Also can claim full
- all allowance previously can claimed would be withdrawn as
agriculture charge
- previous agriculture allowance claimed and not to the disposal
price
- demolition of building is not disposal
- no agriculture charge is imposed on such demolition

Grant from government or state government or statutory

authority
- terima subsisdi, xkena effect pape dah
- no longer be taxed as agriculture charge

Election for spread back

- when has agriculture charge is imposed in the year of disposal or
permanent cessation
- taxpayer may by notice in writing within 3 month for the basis
period in which the disposal is made, to spread back the