Malaysia's Budget 2024: A Glimpse into Companies Updates

The budget for the year 2024 was presented by Prime Minister and Finance Minister YAB Dato’ Seri Anwar Bin Ibrahim on 13th October 2023 and it includes proposals related to the Companies

Key summary on Budget 2024 for Companies under Deductions and Capital Allowance:

A) Tax Deduction

1. Environmental, Social and Governance (ESG) related expenditures

• Up to RM50,000 per YA

• Introduces related expenditures incurred to comply with ESG standards

• Applicable from YA 2024 to YA 2027

2. Cost of Sustainable and Responsible Investments (SRI) sukuk approved by the Securities Commission (SC)

• Extended from YA 2024 until YA 2027 (4 years)

3. Rental of non-commercial EV

• Up to RM300,000

• Extended from YA 2025 until the YA 2027 (2 years)

4. Contributions for Environmental Preservation and Conservation projects

• Involves contributing to or sponsoring activities related to tree planting projects or environmental preservation and conservation awareness projects verified by the Forest Research Institute Malaysia (FRIM)

• Applications received by the Ministry of Finance from 1 January 2024 to 31 December 2026

5. Voluntary Carbon Market

• Up to RM300,000

• Covers costs incurred on the Development and Measurement, Reporting and Verification (MRV) related to the development of carbon projects.

• Tax deduction against income from carbon credits traded on Bursa Carbon Exchange (BCX).

• Registered with an international standards body recognised by Bursa Malaysia and expenditure on development of carbon projects must be certified by the Malaysia Green Technology and Climate Change Corporation (MGTC)

• Applications received by the MGTC from 1 January 2024 until 31 December 2026

B) Capital Allowance

1. ICT equipment and computer software

• Revised to initial allowance (IA) at 40% and annual allowance (AA) at 20%

• Claiming period is shortened from 4 years to 3 years

• Effective from YA 2024

2. Industrial Building Allowance (IBA) – Private Nursing Home for Senior Citizens

• AA at 10% on the total cost of buildings purchased or built, including renovation costs.

• Approved by the Ministry of Health Malaysia (MOH)

• Expenditure incurred from 01 January 2024 to 31 December 2026

In summary, the Budget 2024 proposal for companies primarily focuses on environmental protection to encourage more private sector contributions through projects or community initiatives.

Budget 2024 Highlights - Others

Individual : https://www.ktp.com.my/.../malaysias-budget-2024.../17oct23

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