Essay on Gst-the Malaysian Perspective
Employment Income by Non-resident
In general, employment income is usually taxed when an individual is working in that particular country. Therefore, a foreign national working in Malaysia is responsible to pay his or her tax to Malaysia Inland Revenue under the Malaysian law because he or she is deriving income from Malaysian soil.
But there is some exemption for non-resident in Malaysia under the paragraph 21, Schedule 6 of the ITA; I. During employment for a period or periods which together do not exceed sixty days in the basis year for a year of assessment II. During employment for a …show more content…
Senthil still qualifies for tax exemption in the year of assessment 2010 as his period of employment in Malaysia does not exceed 60 days.
1.1 Circumstances 1
For example, if Senthil was sent by his employer to Malaysia to oversee the promotion of a new product at a related company from 1.4.2010 to 30.4.2010. When the related company in Malaysia experienced some problems later in the same year, Senthil was sent to Malaysia again to monitor the situation from 1.9.2010 to 15.11.2010.
Year 2010 | Work In India | Work in Malaysia | Work in India | Work In Malaysia | Work In India | 91 days | 30 days | 123 days | 76 days | 46 days |
Senthil does not qualify for tax exemption in the year of assessment 2010 as his period of employment in Malaysia has exceeds 60 days.
2.0 Circumstances 2
Sundar was sent to Malaysia for the period from 16.12.2009 to 15.1.2010 (31days) by his employer to conduct feasibility studies for plant improvement to ensure a flexible and economical operation at a subsidiary in Malaysia. Year 2009 | Year 2010 | Work In India | Work In Malaysia | Work In India | 349 days | 31 days | 351 days |
Sundar qualifies for tax exemption for the years of assessment 2009 and 2010 as his employment in Malaysia