What is the tax treatment for the income received by Specialist Doctors?

What is the tax treatment for the income received by medical practitioners (Specialist Doctors)?

IRB has produced a guideline on tax treatment for specialist doctors again on 16 March 2022!

Summarised below are the key salient points :

Case study 1

A specialist doctor with a Sdn Bhd has an agreement with a private hospital.

- Doctor has received consultation fees from the hospital.

- Patient was referred by the private hospital and paid to the hospital directly.

- Facilities in the private hospital have been used during medical treatment.

Tax treatment: The consultation fee received shall be reported under S4(a) of ITA 1967 as individual business income.

Case study 2

A specialist doctor with a Sdn Bhd has been involved in consultation services and medical-related fields (i.e. medical goods trading, pharmaceuticals, and health aids).

Tax treatment: As there are two types of income, it shall be declared with separated sources of income.

a) The consultation fee received shall be reported under S4(a) of ITA 1967 as individual business income.

b) The medical goods trading income shall be reported under S4(a) of ITA 1967 as individual or company business income.

*** Form B: S4(a) of ITA 1967 as individual business income

*** Form C: S4(a) of ITA 1967 as company business income

Case study 3

A specialist doctor with a Sdn Bhd owns a clinic in a private hospital.

- Patient visits the clinic directly without any referral by the private hospital.

- No facilities in the private hospital are being used during medical treatment.

Tax treatment: The consultation fee received shall be reported under S4(a) of ITA 1967 as company business income.

Case study 4

A specialist doctor under an employment contract with a private hospital.

- Doctor has received director remuneration from the hospital.

Tax treatment: The director remuneration received shall be reported under S4(b) of ITA 1967 as employment income.

Expenses can be claimed against S4(a) business income of ITA 1967

Condition: The expenses incurred are wholly and exclusively in the production of gross income.

Example for expenses:

  •  Professional indemnity insurance

  •  Seminars, workshops or conferences approved by CPD Review Committee

  •  Rental of equipment/ operating room in a private hospital

  •  Medical practitioner license and etc.

Capital allowance can be claimed against S4(a) business income of ITA 1967

Persons Eligible to Claim Capital Allowances

  •  A person who is carrying on a business;

  •  Has incurred capital expenditure on an asset for the business;

  •  The asset is used for business purposes.

Source:

Garis Panduan Layanan Cukai Ke Atas Pendapatan Pengamal Perubatan (Doktor Pakar) Di Hospital Swasta Sama Ada Ditaksir Di Bawah Individu Atau Syarikat

https://bit.ly/37bHJfQ

Visit Us

  • Wisma KTP, 53 Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

  • Wisma THK, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

KTP (Audit, Tax, Advisory)

An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients

THK (Secretarial, Account, Payroll, Advisory)

A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsource booking, accounting and payroll services to clients

KTP Lifestyle

An internal community for our colleagues on work and leisure.

KTP Career

An external job community on vacancy in Johor Bahru for interns, graduates & experienced candidates.

#Ktp #Thks

 
 
taxKtp Ktpspecialist doctor, tax on specialist doctor