Termination of Special Income Remittance Program

  

Subsequently, the Ministry of Finance ("MOF") made an announcement to provide certain exemptions for foreign sourced income received by resident persons (other than a resident company carrying on the business of banking, insurance or sea or air transport) in Malaysia effective from 1 January 2022.

  

Effective 11 March 2022, the IRBM announced via a media release that the SIRP will be terminated. The termination of the SIRP is made following the announcement by the Ministry of Finance on 30 December 2021 that, subject to conditions, the following foreign sourced income received from 1 January 2022 to 31 December 2026 will be exempt from Malaysian income tax:

  

  

The IRBM has stated that the above exemption including qualifying conditions will be set out in a gazette to be issued.

  

However,  taxable foreign sourced income remitted during the period of 1 January 2022 to 30 June 2022 will still be taxed at the concessionary tax rate at 3 percent on the gross amount, and is required to be reported in the tax return for the relevant year of assessment.

  

The foreign sourced income amounts remitted after 30 June 2022 will be taxed at the prevailing corporate tax rate which currently  amounts to  24 percent.