Income Tax (Deduction for Expenditure on Issuance of Islamic

In exercise of the powers conferred by paragraph 154(1)(b) of the Income Tax 1967 [Act 53], the Minister makes the following rules:

Citation and commencement

1. (1) These rules may be cited as the Income Tax (Deduction for Expenditure on Issuance of Islamic Securities) Rules 2009.

(2) These Rules shall have effect from the year of assessment 2011 until the year of assessment 2015 in respect of the approval for the issuance of Islamic securities under paragraph 2(1)(a).

(3) These Rules shall have effect from the year of assessment 2010 until the year of assessment 2015 in respect of the approval for the issuance of Islamic securities under paragraph 2(1)(b).

Deduction

2. (1) For the purpose of ascertaining the adjusted income of a company resident in Malaysia and a company incorporated under the Offshore Companies Act 1990 [Act 441], from its business for the basis period for a year of assessment, there shall be allowed a deduction of an amount equal to the expenditure incurred on the issuance of Islamic securities approved, as the case may be, by—

(a) the Securities Commission; or

(b) the Labuan Offshore Financial Services Authority established under section 3 of the Labuan Offshore Financial Services Authority Act 1996 [Act 545].

(2) The deduction referred to in subrule 2(1) shall be pursuant to the principle of mudharabah, musyakarah, ijarah or istisna’ or any other Syariah principle approved by the Minister.

Made 23 November 2009

[CR(8.09)294/6/4-9(SJ.9)(2010); LHDN.01/35/(S)/42/51/231-17.11;
PN(PU2)80/LVIII]

D ato’ Seri Haji Ahmad Husni bin Mohamad Hanadzlah
Second Minister of Finance

[To be laid before the Dewan Rakyat pursuant to subsection 154(2) of the
Income Tax Act 1967]