Tax Incentive for the Provision of Employee Accommodation

The Rules allow a company incorporated under the Companies Act 2016 (Act 777) and resident in Malaysia which is carrying on the  business of manufacturing or manufacturing related services and has obtained an approval of compliance under the [email protected] to claim a tax deduction on the provision of employees’ accommodation.

For the purpose of ascertaining the adjusted income of a company from its business in a basis period for a year of assessment, a  deduction shall be allowed for an amount equivalent to the expenses incurred by the company on rental of a premise for the purpose of employees’ accommodation within the period from 1 January 2021 until 31 December 2022. The total amount of expenses allowed shall not exceed RM50,000 for each company. The amount of deduction allowed under The Rules shall be in addition to any deduction allowable under section 33 of Income Tax Act 1967 (The Act). Employees’ accommodation referred to in The Rules shall be  accommodation certified with a Certificate for Accommodation as provided under section 24D of the Employees’ Minimum Standards of Housing, Accommodations and Amenities Act 1990, but excludes accommodation for director. Click here for the references.

” In our point of view, The Rules enable companies to reduce tax burden
through the tax deduction. It also encourages companies to provide
accommodation to the employees who live long distances from the
workplace. As a result, it ensures convenience and productive working
environment for employees.”

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Author(s)

Our Leader
Norzila Othman
Senior Manager,

Tax

Contributing Advisors