TAX REBATE FOR SET UP OF NEW BUSINESSES
According to Short-term Economic Recovery Plan (Penjana), newly established SME can get up to RM 20k tax rebate for the first three years!
New company / LLP that established within July 2020 to December 2022 are eligible for a tax rebate up to RM 60,000 (in total). To get this tax rebate, the company must be SME and is newly establish. Meaning that if you are transferring your company from any types into Sdn Bhd or Limited Liability Partnership, it is not applicable for this tax rebate. This rule is newly commented by LHDN in 2021.
Besides, to get this tax rebate, you are advise not to transfer your existing staff or company asset (like plant, equipment & facility) from the current company to your new company.
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FAQS
According to Short-term Economic Recovery Plan (Penjana), newly established SME can get up to RM 20k tax rebate for the first three years!
Those SME registered under Companies Act 2016 (which means Sdn. Bhd. & Plt.) and start their operation within the period 1st of July 2020 until 31st of December 2022.
This rebate start from 1st of July 2020 and end on 31st of December 2022.
The company has to take note that:
- Amount of rebate is based on company operating expenses and capital expenditure
- It is up to RM 20,000
- To claim this rebate, the company has to buy NEW facility, plant and equipment (Cannot be transferred from existing or related company)
- For example, if the company spent only RM 10,000 on operating expenses and capital expenditure, they can claim up to RM 10,000 rebate; if they spent RM 30,000 on operating expenses and capital expenditure, they can claim up to RM 20,000
| Total | Tax Rebate | |
| Operating expenses / Capital expenditure | 35,000 | 20,000 |
| Operating expenses / Capital expenditure | 20,000 | 20,000 |
| Operating expenses / Capital expenditure | 15,000 | 15,000 |
| ||
No, the tax rebate cannot be carried forward to the next year.
The company must be SME (The paid-up capital has to be RM 2.5 million or below, and annual sales not more than RM 50 million)
Additional conditions listed by LHDN: (Added Nov’ 21)
- The newly established entity must operate in a different premise than that of its related company (if applicable);
- The new entity must use a different plant, equipment and facility than that of any related company and the plant, equipment and facility are not transferred from any related company (if applicable);
- All employees (not including key personnel) must be different employees that that of any related company (if applicable);
- Partnership or company that changes into Limited Liability Partnership or vice versa is not eligible.
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