(Tax Update) Latest IRB Updates on e-Invoice Downtime & e-Ansuran Tax Instalment (Copy)

(Tax Update) Updated Guidelines for Reinvestment Incentives

Incentive Mechanism Overview :

In 2024, the Malaysian government, through the Malaysian Investment Development Authority (MIDA), has introduced a reinvestment incentive aimed at encouraging companies to continue investing in high-growth and high-value activities.

This incentive comes in the form of a tiered Investment Tax Allowance (ITA) and is particularly beneficial for companies that have exhausted their Reinvestment Allowance (RA) period.

Recently, MIDA has updated the Guideline and Procedures for the Application of Incentive for Reinvestment to provide clarity on the mechanism and requirements.

Validity of Incentive Approval

Companies must submit the following within 36 months from the date of the approval-in-principle letter:

Application for determination of incentive commencement date.
Declaration of compliance with minimum conditions, verified by external auditors.

Failure to submit within 36 months will result in automatic cancellation of the approval.

Commencement Date of Incentive

Scenario 1:
Capital expenditure is incurred after submission

Incentive begins from the first capital expenditure incurred.

Scenario 2:
Capital expenditure is incurred before submission

That expenditure is not qualifying.
Incentive begins one day after submission of the application.

Applicants should plan their capital expenditure carefully to fully enjoy the tax incentive.

Post-Incentive Declaration

A declaration of compliance with all conditions, verified by external auditors, must be submitted to MIDA within seven months after the incentive period ends.

Access to Full Guideline:

The full guideline can be found at www.mida.gov.my
(Forms and Guidelines > Manufacturing Sector > Applications for Incentive / Expatriate Posts)

Past Reference to Reinvestment Incentive in our Blog :

12/09/24 Unlock the Benefits of Reinvestment Incentive | Tax Incentives for Malaysian Manufacturers
https://www.ktp.com.my/blog/unlock-the-benefits-of-reinvestment-incentive/12sept2024
15/08/2024 New Tax Incentive Under the Industrial Master Plan 2030
https://www.ktp.com.my/blog/reinvestment-incentive-under-the-industrial-master-plan/15aug2024

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