INCOME TAX (DEDUCTION FOR PROMOTION OF EXPORT OF SERVICES) RULES 2002 [P.U. (A) 114]

INCOME TAX (DEDUCTION FOR PROMOTION OF EXPORT OF SERVICES) RULES 2002 [P.U. (A) 114]

(Gazetted on 28 March, 2002)

 

 

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 Promotion of Export of Services) Rules 2002.

 

      (2)  These Rules shall have effect from the year of assessment 2002.

 

Company eligible for deduction

 

2.   Every company resident in Malaysia for the basis year for a year of assessment shall be eligible for the deduction under these Rules for that year of assessment.

 

Deduction

 

3.   (1)  Subject to these Rules,for the purpose of ascertaining under the Act the adjusted income of a company from its business for the basis period for a year of assessment,there shall be allowed as a deduction any outgoings and expenses of the kind described in subparagraph (2) which were incurred —

 

(a)  by the company during that basis period with respect to the business; and

 

(b)  primarily and principally for the purpose of promoting the export of services.

 

(2)  The outgoings and expenses referred to in subparagraph (1) are —

 

(a)  expenses incurred in respect of feasibility studies for overseas projects identified for the purpose of tender;

 

(b)  expenses incurred in respect of participation in a trade or industrial exhibitions in Malaysia or overseas;

 

(c)  expenses incurred in respect of participation in exhibitions held in a Malaysian Permanent Trade and Exhibition Centre overseas;

 

(d)  expenses by way of air fares in respect of travel to a country outside Malaysia by a representative of the Company; and

 

(e)  actual expenses subject to a maximum of three hundred ringgit per day for accommodation and a maximum of one hundred and fifty ringgit per day for sustenance of the whole of the period commencing with the representative’s departure from Malaysia and ending with his return to Malaysia.

 

(3)  The deduction allowed under these Rules shall be in addition to any deduction allowable under section 33 of the Act.

 

(4)  No deduction shall be allowed under these Rules in respect of any outgoings,expenses or other payments which are -

 

(a)  of the kind mentioned in subsection 39(1) of the Act; or

 

(b)  incurred by a company having a place of business and subject to tax in the country where such outgoings or expenses were incurred.

 

(5)  Where the amount of any outgoings and expenses,the whole of which would have been allowable as a deduction under these Rules,exceed the amount which in the opinion of the Director General would reasonably be expected to be incurred in the ordinary course of the business with respect to the outgoings and expenses that were incurred,the Director General may not allow the excess amount as a deduction under these Rules.

 

Made 13 March 2002.

[Perb.0.3865/73 (SJ.45); LHDN.01/35/(S)/42/51/82-11.1; PN(PU²) 80/XXXII]

 

On behalf and in the name of the Minister of Finance,

 

CHAN KONG CHOY

Deputy Minister of Finance

 

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