In view of the imposition of tax on foreign sourced income, IRBM has introduced a Special Income Remittance Programme (PKPP) on 16 November 2021. This programme will be available to Malaysian residents from 1 January to 30 June 2022.
Foreign income that is remitted to Malaysia during the period would be taxed at a flat rate of 3% (at gross income basis). According to IRBM, there would be no audit, investigation or penalty on income brought in under the programme – IRBM will accept taxpayers’ declaration in good faith.
This is to encourage taxpayers to repatriate their foreign income to Malaysia before the full tax rates are charged on their foreign income starting 1 July 2022.
The programme does not cover income derived from Malaysia which is subject to tax for the year of assessment 2021 and subsequent years of assessment.
Upon the expiration of the programme, IRBM will check and examine the income information of Malaysian tax residents deposited abroad based on the information the authorities have obtained vide information exchange arrangements and agreements with other jurisdictions, including AEIO.
As a warning, IRBM has stated that any undeclared income derived from Malaysia but kept abroad would be imposed with tax and penalties in accordance with the provision of the Income Tax Act.
More information from LHDN a) Media statement
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As our valued client, you are advised to time your remittance of foreign sourced income and make early plans in regards to your foreign income and assets.
If you would like us to assess your tax position, please do not hesitate to contact us for further enquiry.
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