150 Individual Income Tax Rates - YA2020 Rate Tax Chargeable Income (RM) % (RM) On the First 5,000 0 Next 15,000 On the First 20,000 150 Next 15,000 3 450 On the First 35,000 600 Next 15,000 8 1,200 On the First 50,000 1,800 Next 20,000 14 2,800 On the First 70,000 4,600 Next 30,000 21 6,300 On the First 100,000 10,900 Next 150,000 24 36,000 On the First 250,000 46,900 Next 150,000 24.5 36,750 Company with paid up capital more than RM2.5m 24% Company with paid-up capital of not more than RM2.5 million and with annual sales of not more than RM50 million On first RM600,000 17% Subsequent Balance 24% Non-resident company 24% Trust body (resident or non-resident) 24% Real Property Gains Tax Rates Company Indiv 1 Indiv 2 Disposed within 3 years 30% 30% 30% Disposal in 4th year 20% 20% 30% Disposal in 5th year 15% 15% 30% Disposal in 6th year and thereafter 10% 5% 10% Indiv 1 - An individual who is a citizen or a permanent resident of Malaysia. Indiv 2 - An individual who is neither a citizen nor a permanent resident of Malaysia. 5 UBAT3123/UBAT3124 ADVANCED TAXATION Stamp duty Rate % Sale of property For every RM100 or part thereof. On the first RM100,000 On the next RM400,000 On the excess over RM500,000 1 2 3 Sale of shares On every RM1,000 or part thereof 0.3 Founded by a group of businessmen, the EZ Group of companies comprise of three tax resident companies to undertake various investments in the country. None of the companies have applied for any tax incentives. Details of business activity for the three companies are as follows: (a) Alpha Sdn Bhd was incorporated in January 2021 and manufactures plastic pipes, a promoted product. The company expects to be profitable in 2021 and onwards and to be generating a statutory income of RM8 million a year. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (3 marks) Explain the incentive mechanism, providing relevant computations, where necessary (7 marks) (1) (b) Beta Sdn Bhd was incorporated in January 2021 to manufacture steel pipes, a promoted product. It intends to invest approximately RM1 million, RM800,000 and RM200,000 in the years 2021, 2022 and 2023 respectively. The company will only be profitable from 2024. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (5 marks) (ii) Explain the incentive mechanism, providing relevant computations, where necessary. (9 marks) (c) Delta Sdn Bhd manufactures carton boxes with a value-added of 35% to 40% in their products. It has recently started exporting to Brazil and expects an increase in the annual export sales of 10% for the coming years. Total sales value in 2020 was RM8 million of which RM2 million were from export sales. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (6 marks) Explain the incentive mechanism, providing relevant computations, Where nossary (ii) (5 marks) 150 Individual Income Tax Rates - YA2020 Rate Tax Chargeable Income (RM) % (RM) On the First 5,000 0 Next 15,000 On the First 20,000 150 Next 15,000 3 450 On the First 35,000 600 Next 15,000 8 1,200 On the First 50,000 1,800 Next 20,000 14 2,800 On the First 70,000 4,600 Next 30,000 21 6,300 On the First 100,000 10,900 Next 150,000 24 36,000 On the First 250,000 46,900 Next 150,000 24.5 36,750 Company with paid up capital more than RM2.5m 24% Company with paid-up capital of not more than RM2.5 million and with annual sales of not more than RM50 million On first RM600,000 17% Subsequent Balance 24% Non-resident company 24% Trust body (resident or non-resident) 24% Real Property Gains Tax Rates Company Indiv 1 Indiv 2 Disposed within 3 years 30% 30% 30% Disposal in 4th year 20% 20% 30% Disposal in 5th year 15% 15% 30% Disposal in 6th year and thereafter 10% 5% 10% Indiv 1 - An individual who is a citizen or a permanent resident of Malaysia. Indiv 2 - An individual who is neither a citizen nor a permanent resident of Malaysia. 5 UBAT3123/UBAT3124 ADVANCED TAXATION Stamp duty Rate % Sale of property For every RM100 or part thereof. On the first RM100,000 On the next RM400,000 On the excess over RM500,000 1 2 3 Sale of shares On every RM1,000 or part thereof 0.3 Founded by a group of businessmen, the EZ Group of companies comprise of three tax resident companies to undertake various investments in the country. None of the companies have applied for any tax incentives. Details of business activity for the three companies are as follows: (a) Alpha Sdn Bhd was incorporated in January 2021 and manufactures plastic pipes, a promoted product. The company expects to be profitable in 2021 and onwards and to be generating a statutory income of RM8 million a year. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (3 marks) Explain the incentive mechanism, providing relevant computations, where necessary (7 marks) (1) (b) Beta Sdn Bhd was incorporated in January 2021 to manufacture steel pipes, a promoted product. It intends to invest approximately RM1 million, RM800,000 and RM200,000 in the years 2021, 2022 and 2023 respectively. The company will only be profitable from 2024. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (5 marks) (ii) Explain the incentive mechanism, providing relevant computations, where necessary. (9 marks) (c) Delta Sdn Bhd manufactures carton boxes with a value-added of 35% to 40% in their products. It has recently started exporting to Brazil and expects an increase in the annual export sales of 10% for the coming years. Total sales value in 2020 was RM8 million of which RM2 million were from export sales. Required: (1) Recommend a suitable tax incentive for the company. Support your recommendation with reasons and list the criteria for the incentive. (6 marks) Explain the incentive mechanism, providing relevant computations, Where nossary (ii)