Corporate Tax

 Tax computation of a company is constructed based on the

audited accounts and additional documents/files provided by
company

 Self assessment from YA 2001

 Required to submit the return within 7 months after closing

the company year-end
Computation of Adjusted Income
RM RM
- +
Net profit before tax xxx

(+) Non allowable expenses

- depreciation
- interest expense relates to rental income
- entertainment for client (50% allowed)
- general provision for bad debts/doubtful debts
- amortisation
(+) Donation

(+) Capital asset expense off to profit & loss account

- Renovation
- Improvement
- Installation
(S39: prohibited expenses)
(-) Expenses qualified for double deduction
- handicapped employee
- approved training
- registration of patents/trademarks
- promotion of exports

(-) Revenue expenses capitalised

- interest expense
- lease rental

(-) Gain on disposal of long-term investment

(-) Investment income separately assessed
 RM RM

- +

Net profit before tax XXX

(+) Non allowable expenses xx

(+) Donation xx
(+) Capital asset expense off to profit & loss account xx

(-) Expenses qualified for double deduction xx

(-) Revenue expenses capitalised xx
(-) Gain on disposal of long-term investment xx
(-) Investment income separately assessed xx (xxx)

Adjusted Income/(Loss) XX
 Only business source can have Adjusted Loss

 Can be set off against business income and non-business

income in the same basis year against the Aggregate Income

 If Adjusted Loss cannot be fully utilized in the current basis

year, the balance is carry forward to set off only against
business source at the Aggregate Statutory Income from
businesses in future years
Adjusted income
(+) Balancing charge
(-) Capital allowance
• Unavoidable CA b/f
• Current year CA
• Balancing allowance

Statutory Income for Business

Statutory Income Business 1
(+) Statutory Income Business 2

Aggregate Statutory Income for Business

(-) Unabsorbed Business Loss

(+) Investment Income (note 1)

Aggregate Income

(-) Current year business loss

(-) Approved donation (note 2)

Total/Chargeable Income
Note 1: Investment Income

Interest income X
(-) W & E incurred (X)
Adj income/statutory income XX

Rental income X
(-) W & E incurred (X)
Adj income/statutory income (loss) (XX) NIL
Statutory income business 1 X
Statutory income business 2 X
Aggregate stat income for business XX
(-) Unabsorbed business loss (X)
XX
(+) Investment income:
Statutory interest income X
Statutory rental income X
Aggregate income XXX
(-) Current year business loss (X)
(-) Donation (approved) (X)
Total income/chargeable income XX
Note 2: Donation

 Approved donation (approved institution/organisations/NGOs/fund)

 Cash donation: restricted to 10% of company’s aggregate income

 No limit if cash donation to government

 Zakat for business/Religion accountability for business

 2.5% of aggregate income
Tax Rate

 Paid up capital (ordinary shares) ≤ RM 2.5 million

 Gross income of all business ≤ RM 50 million
Chargeable income Rate
First RM 600,000 17%
Excess RM 600,000 24%
 For other companies:
 Tax rate 24%
 THE END
Alhamdulillah