INCOME TAX (DEDUCTION FOR INCORPORATION EXPENSES) RULES 2003 [P.U. (A) 475]

INCOME TAX (DEDUCTION FOR INCORPORATION EXPENSES) RULES 2003 [P.U. (A) 475]

(Gazetted on 31 December, 2003]

 

IN exercise of the powers conferred by paragraph 154(1)(b) of the Income Tax Act 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 Incorporation Expenses) Rules 2003.

 

(2) These Rules come into operation from the year of assessment 2004.

 

Deduction

 

2. (1) For the purpose of ascertaining the adjusted income from a business for the basis period for a year of assessment of a company which is incorporated in Malaysia on or after 13 September 2003 and having authorized capital of not more than RM2,500,000 there shall be allowed a deduction of an amount equal to the expenditure incurred by that company in relation to its incorporation.

 

(2) Incorporation expenses referred to in subparagraph (1) shall be the following:

 

(a) the cost of preparing and printing the memorandum of association, the articles of association and the prospectus, and of circulating and advertising the prospectus;

 

(b) the cost of registering the company and the statutory documents, together with fees and stamp duties payables thereon;

 

(c) the cost of drawing up the preliminary contracts and stamp duties payable thereon;

 

(d) the cost of printing debentures and stamp duty (if any) payable thereon and of share certificates and letters of allotment;

 

(e) the cost of the seal of the company; and

 

(f) underwriting commision.

 

(3) For the purpose of subparagraph (1), any incorporation expenditure incurred by the company shall be deemed to have been incurred in the basis period for a year of assessment in which the business of that company commences.

 

(4) In relation to a company which has an authorized capital of more than RM250,000 and not more than RM2,500,000 and has incurred incorporation expenditure during the period 13 September 2003 until 31 December 2003 and that period forms part of the basis period for the year of assessment 2003, that incorporation expenditure shall be deemed to have been incurred in the basis period for the year of assessment 2004.

 

Revocation

 

3. The Income Tax (Deduction of Incorporation Expenses) Rules 1974 [P.U. (A) 134/1974] are revoked with effect from the year of assessment 2004.

 

Made 15 December 2003

[Perb. CR(8.09) 294/6/4-9 (SJ. 5) Vol. 3 (SK. 6); LHDN. 01/35/(S)/42/51/231-17.5; PN(PU²)80/XXXIX]

 

DATO’ DR. JAMALUDDIN BIN MOHD JARJIS

                                                                                                                       Minister of Finance II

 

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