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MM2H: Possible Global Tax changes

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  1. #1

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    MM2H: Possible Global Tax changes

    A new topic has emerged in Malaysia which might make MM2H less interesting: Friday the government announced the 2022 budget. One of the items which they plan to implement from January 1st onward is that all foreign income will be taxed. Until now is the tax percentage for foreign income 0%. No specific tax percentage was mentioned but if the tax percentage is identical to that of domestic income, then this could mean a tax rate of up to 30%. A table with tax rates for 2020 can be found in this article:
    https://ringgitplus.com/en/blog/inco...1-ya-2020.html


  2. #2

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    MM2H: Possible Global Tax changes

    Spotted online..


    Effective from January 1, 2022, Malaysian residents will be taxed on their foreign-sourced income that is received in Malaysia. Through this measure, the government hopes to comply with the scope of the OECD Forum on Harmful Tax Practices and could help remove Malaysia from the European Union’s ‘grey list’ of tax havens.

    For countries that have a double taxation avoidance agreement with Malaysia, the taxpayer can claim tax relief for interest, royalty, and technical fees.
    https://www.aseanbriefing.com/news/n...s-budget-2022/

  3. #3
    Quote Originally Posted by Windmill65:
    from January 1st onward is that all foreign income will be taxed. this could mean a tax rate of up to 30%. A table with tax rates for 2020 can be found in this article:
    https://ringgitplus.com/en/blog/inco...1-ya-2020.html
    There goes one of the significant benefits of Malaysia as the retirement place.
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  4. #4

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    Missed this one.. Split into a new thread for now.

    Will wait to see what goes into the tax tables and rules.

    Looks like this is related to foreign sourced income brought into or credited to accounts in Malaysia. Who knows..


  5. #5

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    Dont forget to call friend Erdogan to the party..

  6. #6

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    KPMG has some more on the tax changes.

    The link to the full report is somewhere at the bottom of the page. The good news .. EVs are essentially tax free.

    https://home.kpmg/us/en/home/insight...dget-2022.html

    PWC says foreign income remitted to Malaysia. No clue how this would work efficiently.. other than some extra paperwork and consulting fees being paid.

    But as has become typical of malaysia these days, this tax is categorised as corporate - in their detailed PDF at the bottom of the article.

    All too confusing.

    Removal of tax exemption of foreign income - foreign-sourced income of Malaysian tax residents is taxed upon remittance into Malaysia.
    https://www.pwc.com/my/en/publicatio...ion-part1.html

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    Last edited by shri; 11-11-2021 at 09:40 AM.
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  7. #7

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    Meanwhile there is an update ("part 2") on the TaXavvy report which you quote. This has some clarification on the tax on foreign remittance into Malaysia.
    https://www.pwc.com/my/en/assets/pub...2022-Part2.pdf
    On page #6:

    shri likes this.

  8. #8

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    Thanks for that ... makes it all the more concerning for people who are waiting for the medical side to resolve before they move to Malaysia.


  9. #9

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    Very sad to see Malaysia caving in to bullying from the EU

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  10. #10

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    Quote Originally Posted by Paxbritannia:
    Very sad to see Malaysia caving in to bullying from the EU
    That is probably one of the reasons why they come up with this taxation. Another reason is that they are running out of money: they have been handing out way too much money during the Covid pandemic. Not only the government is running low on money, also the state pension fund (EPF) has suffered severely. So they are looking for new taxes to replenish the shortages.

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