IRB tax my other income !

01𝐃𝐨 𝐲𝐨𝐮 𝐤𝐧𝐨𝐰 𝐈𝐑𝐁 𝐰𝐢𝐥𝐥 𝐭𝐚𝐱 𝐲𝐨𝐮𝐫 𝐜𝐚𝐬𝐮𝐚𝐥 𝐢𝐧𝐜𝐨𝐦𝐞 𝐰𝐡𝐢𝐜𝐡 𝐭𝐚𝐱𝐩𝐚𝐲𝐞𝐫𝐬 𝐚𝐥𝐰𝐚𝐲𝐬 𝐚𝐬𝐬𝐮𝐦𝐞 𝐢𝐬 𝐧𝐨𝐭 𝐭𝐚𝐱𝐚𝐛𝐥𝐞?

👉Overview of casual profit/income
A casual profit is an income which, received by a person from an activity outside his ordinary trade or vocation, but which nevertheless is a profit or income item accruing to him by virtue of services rendered or a receipt payment from property not chargeable elsewhere.

👉Key takeaways:

You will understand: -

1. What is casual profit or income?

2. Tax treatment of casual profit or income based on real tax case.

👉Summary of learnings:
Casual profits or income is chargeable under section 4(f) of the Income Tax Act (ITA) 1967.

👉What is the casual profit or income?
Payments for services are income even where there is no repetition, such as the followings:

✅Commissions paid to a director for guaranteeing bank overdrafts or bank loans.

✅Brokerage fees

✅Introduction fees

✅Fees for the occasional hosting as the master of ceremony, fees for the occasional newspaper articles, or the giving ad-hoc lectures.

👉Tax treatment on casual profit or income based on real tax case

ABM v. KETUA PENGARAH HASIL DALAM NEGERI (PKCP (R) 780/2017)

IRB raised a tax query of the source of income arose to purchase an asset under taxpayer and his wife.

The source of income of RM750,000 is arriving from for introduction fees and this income was not reported.

Decision by The Court

The final judgement is the income of RM750,000 are taxable under section 4(f) ITA 1967.

👉Sources: http://phl.hasil.gov.my/pdf/pdfam/ABM_v_KPHDN_21012021.pdf

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