a)

No. Title A Explanation

1 Legal
Cost offees
factory
and land
stamp duty on acquiring No Land does not
construction of qualify
the as qualifying building expenditure
2 the factory land No factory.
the basis of the
3 Legal fees on the construction contract Yes capital asset.
as an industrial
4 Cost of construction and fittings Yes building.
materials, labour, haulage, management, supervision and other
5 Professional fees for design and supervisi Yes overhead charges directly related to the construction;

b) YA2018 Legal fees on the construction contract 1,000

Cost of construction and fittings 545,000
Professional fees for design and supervisi 60,000
Qualifying Expenditure (QE) 606,000

Qualifying Expenditure (QE) 606,000

(-) Initial allowances
10% x 606,000 60,600
(-) Annual allowances
3% x 606,000 18,180
Residual Expenditure (RE) 527,220

C) Qualifying Building Expenditure RM

YA2014 : 800,000
(-) Initial Allowance (10%) 80,000
(-) Annual Alllowance (3%) 24,000
Residual Expenditure 696,000
YA 2015:
(-) Annual Allowance (3%) 24,000
Residual Expenditure 672,000
YA2016:
(-) Annual Allowance (3%) 24,000
Residual Expenditure 648,000
YA2017:
(-) Annual Allowance (3%) 24,000
624,000
YA2018
Disposal of Factory 1,000,000
Balancing Charge 376000 176,000 Adding the 4 annual allowance's for the year 2014-2017 will equal 176,000 which is lesser than balancing charge 376,000.So, we will cliam 176,000
i. Plant A
Tree Sdn Bhd (Disposer) (1.10-30.9)
Leaves Sdn Bhd (Acquirer) (1.4-31.3)
Step 1 Date of disposal 1/11/2018
Step 2 Acquirer YA 2019 (1.4.2018-31.3.2019)
Step 3 Disposer YA 2019 (1.10.2018-30.09.2019)
First day of disposer final period 1.10.2018 The date of disposal of the Plant A is deemed to have taken place on 1.10.2018
Step 4 Last YA disposer can claim YA 2018
First YA acquirer can claim YA 2019

ii. Plant A
Disposer (Trees Sdn Bhd) RM 1 July 2018
Qualifying Expenditure 2000
YA2018 Initial Allowance(20%) 400
Annual Allowance (10%) 200
Residual Value 1400
YA2019 Disposal price 1400
Balancing charges/allowances NIL

Acquirer (Leaves Sdn Bhd) RM

YA 2019 Residual Expenditure 1400
Annual Allowance (10%) 200
Residual Expenditure 1200

Plant B
Disposer: Trees Sdn Bhd (1.10-30.9)
Acquirer: Leaves Sdn Bhd (1.4-31.3)
Step 1 Date of Disposal: 1 July 2018
Step 2 Acquirer YA 2019 1/4/18-31/3/19
Step 3 Disposer YA 2019 1/10/18-30/9/19
First day of disposal final period 1/10/18
Last YA disposer can claim 2018
First YA acquirer can claim 2019
 Disposer (Trees Sdn Bhd) 1 May 2017
RM
YA 2017 Qualifying expenditure 1000
(-)IA 20% 200
YA2018 AA 10% 100
AA 10% 100
Residual Value 600.00
Disposal Value (600)
Nil
Acquirer (Leaves Sdn Bhd) RM
YA 2019 Qualifying Expenditure 700
(-)Annual Allowance (10%) 100
Residual Expenditure 600
(-)Annual Allowance (10%) 100
YA 2019 500

i) Disposer's final period

Machinery Acquirer - Leaves Sdn.Bhd

Disposer - Trees Sdn.Bhd

Step 1 Disposal date 1/2/2019

D-30/09
A-31/03

Step 2 Acquirer
YA2019 1/4/2018 - 31/3/2019

Disposer
YA2019 1/10/2018 - 30/09/2019

Step 3 First date of final disposer's period 1/10/2018

ii) Computation of capital allowances.

Machinery
YA2019 - Acquirer -Leaves Sdn Bhd

QE 800
(-) Initial allowance (20%) 160
(-)Annual allowance (14%) 112
RE 528

* Disposer, Trees Sdn Bhd cannot claim any allowances, since they bought and sold the machinery in YA2019.
Disposer acquired the machinery on 1 November 2018. Disposal on 1 February 2019.
Arfa vivien mina clearing land
Qama Syasya Lukma Road
Dina , Nazartul,mylna construction of plantation office
Kuhan, Amjad planting of cocoa
Misha, Lalan, Najihahcost of replanting, general machinery
ilyas,wan Living Quarters and Land

Year of assessment Clearing Land (50%) RM50,000Construction of Road (50%) RM50,000

2017 RM 25,000 RM 25000

2018 RM 25,000 RM 25000
2019 NIL NIL

RM
QUESTION 1 (II) Adjusted income 1,300,000
(-) Cost of replanting 21,000

New adjusted income 1,279,000

(-) capital allowances for agricul 25,900
(-) capital allowance for plant a 5440
Statutory income 1,247,660

Year of assessment Clearing Land (50%) RM50,000Construction of Road (50%) RM50,000

2017 RM 25,000 25000

2018 RM 25,000 25000
2019 NIL NIL
Agricultural Charge 50000

PETOLA SDN
 Clearing Land (50%) RM50,000Construction of Road (50%) RM50,000
Year of assessment
2019 NIL NIL
Adjusted income
Less: capital allowances
Statutory income

QUESTION 1 (I)
PETANI SDN BHD

Planting of Cocoa (50%) RM38,000Construction of plantation office (10%) RM17,000 Land

NIL 1700
19,000 1700
19,000 1700 Nil

*The cost of acquiring the land f

QUESTION 2 scenario (I)

PETANI SDN BHD

Planting of Cocoa (50%) RM38,000Construction of plantation office (10%) RM17,000 Land

NIL 1700
19,000 1700
4,685 419.18 Nil
23,685 3819.18

PETOLA SDN BHD

Planting of Cocoa (50%) RM38,000Construction of plantation office (10%) RM17,000 Land

9,265.75 1281
 Living Quarters (20%) 26,000 Cost of replantingCost of general machinery

5200
5200
5200 Nil Nil

*replanting means that the same crop is planted in the same area and is not a QE for
cost of acquiring the land for plantation is not a qualifying * cost of plant and machinery is not a QE for agriculture. The expen

Living Quarters (20%) 26,000 Cost of replantingCost of general machinery

5200
5200
RM1,282 NIL NIL
11682
Living Quarters (20%) x 26,000

RM3,918
*5200 -(90/365*5200)
 * plant and machinery allowance
QE 16000
(-) IA 3200
(-) AA 2240
RE 10560
in the same area and is not a QE for agriculture allowance
s not a QE for agriculture. The expenditure would qualify for capital allowance if it fulfills the functional test of plant and machine
onal test of plant and machinery
Question 1

i) Installation fee 50,000

Consultancy fee 270,000
Tax Rate 10%
Withholding tax 32000

ii) Installation fee paid on 1 June 2019, therefore need to paid the tax before 1 July 2019
Consultancy fees amounting RM70,000 paid on 10 July 2019, therefore need to paid the tax before
Consultancy fees balance amounting RM200,000 paid on 1 August 2019, therefore need to paid th

iii)
Milestone
The paymentSdnwill
Bhd beneed to pay as
disallowed 10%anofexpense
penalty in
from
the withholding
computationtax
of (subsection
the adjusted109(2)
incomeof from
the ITA)
any
ITA)
If Milestone Sdn Bhd did not pay the with holding tax and claim for the expense , it will be charged

Question 2 Hutchins
*Royalty
* Services performed in Holland. Now no witholding tax payable in Malaysia.

Cavalli classes
special Training fee
of witholding
in income Less: WTH tax payable (10%
tax Net amount payable to non-r

Question 3 i) Chargable Service: Fees for technical assistance

Installation charges

Withholding tax 10% of Chargable service

Penalty of Fees for technical assistance (10%

ii) The staff training is deductible after paying out the withholding tax and the penalty.
x before 1 July 2019
refore need to paid the tax before 9 August 2019
st 2019, therefore need to paid the tax before 1 September 2019

ax
of (subsection
the adjusted109(2)
incomeoffrom
the ITA)
any source of the payer (paragraph 39(1)(q) of the

r the expense , it will be charged 100% penalty.

ng tax payable in Malaysia.

RM
155000
15500
139500
* Paid on 6 July 2019 so witholding tax needs to be paid by 5 August 2019

80,000
40,000
120,000
12000

8000
10%
 800

e withholding tax and the penalty.