On 15 January 2024, The Inland Revenue Board of Malaysia (IRBM) announced that it had published the Capital Gains Tax Return Form (CGTRF) Filing Programme.
Malaysia’s Finance (No. 2) Act of 2023 has introduced new regulations regarding the taxation of capital gains from the disposal of capital assets, including foreign capital assets. However, there is a general exemption for gains derived from the sale of capital assets located in Malaysia, with two exceptions:
- share of a company incorporated in Malaysia not listed on the stock exchange or;
- share of a controlled company incorporated outside Malaysia which owns real property situated in Malaysia or shares of another controlled company or both, are exempt from capital gains tax from 1st January 2024 to 29th February 2024.
Submission of CGTRF and payment of Capital Gains Tax shall be made within 60 days from the date of disposal of the capital asset.
Tax Imposition On Gains Of Capital Asset Disposal
Effective from 1st January 2024, company, limited liability partnership, trust body and co-operative society which receives gains or profits from the disposal of capital assets consisting of:
- share of a company incorporated in Malaysia not listed on the stock exchange or
- share of a controlled company incorporated outside Malaysia which owns real property situated in Malaysia or shares of another controlled company or both, are subjected to Capital Gains Tax under the Income Tax Act 1967.
Labuan entity (Labuan Company, Labuan Limited Liability Partnership, Labuan Foundation and Trust) that elect or are subject to taxation under the ITA 1967 are subject to the imposition of Capital Gains Tax.
Responsibility for CGTRF Submission
Chargeable persons according to the provisions of section 66 to section 75B, are responsible for submitting CGTRF. The appointed representatives are responsible for submitting CGTRF on behalf of the taxpayer. The representatives are assessable and chargeable to tax and the payment of tax charged. A licensed tax agent under section 153 of the ITA 1967 can be appointed for the purpose of submitting CGTRF
Tax Reporting
Taxpayers are required to submit CGTRF through e-filing (e-CKM Form) at the MyTax portal at https://mytax.hasil.gov.my to access the e-CKM Form from 1st March 2024. Taxpayers shall have a Tax Identification Number (TIN) and Digital Certificate to access e-CKM.
Working Sheets/Supporting Documents
Working sheets / Supporting Documents used for computation need not be submitted together with the CGTRF. Worksheets / Supporting Documents shall be kept for 7 years after the end of the year in which the CGTRF is furnished to the Director General of Inland Revenue.
All documents, including documents related to tax relief claims under sections 132 and 133 of the Income Tax Act 1967, have to be furnished only if requested for audit purposes.
Grace Period for the Payment of Tax
For assessments raised under sections 91, 96A and subsections 90(3), 101(2) of ITA 1967, the tax/balance of tax shall be paid within 30 days from the assessment date. Nevertheless, a grace period of 7 days is given.
