Most of the time, a conference is a large meeting where researchers, academicians, and professionals can share their work and research in fields like medicine, law, science, engineering, technologies, business management, and so on.
Since the year of assessment 1997, Malaysian organisers of conferences whose principal activities are to promote and run conferences have been given tax incentives if they bring in at least 500 foreign participants each year [Income Tax (Exemption) (No. 53) Order 2000].
In Budget 2020, the government introduced tax incentives for qualifying persons whose principal activities are other than promoting or organising conferences. This is part of an effort to make Malaysia the best place for international conferences. These qualifying persons must bring at least 500 foreign people to conferences that they promote or organise every year [Income Tax (Exemption) (No.4) Order 2021].
Consequently, the IRB published Public Ruling (PR) No. 2/2022 titled "Tax Incentive For Organising Conferences In Malaysia" on the 29th of July 2022 to explain the tax incentive that is now available.
The Public Ruling outlines the tax incentive that was provided under:
The Income Tax (Exemption) (No. 53) Order 2000 [P.U. (A) 500]; and
The Income Tax (Exemption) (No.4) Order 2021 [P.U. (A) 195/2021].
The Public Ruling also includes examples to exemplify the tax incentive.
Income Tax (Exemption) (No.53) Order 2000 [P.U. (A) 500/2000]
Effective from the year of assessment 1997 onwards, tax exemption is granted for eligible conference promoters:
brought in at least five hundred (500) foreign participants to attend conferences held in Malaysia on the basis year for a year of assessment; and
the exemption is on 100% of the statutory income derived from organising conferences held in Malaysia in the relevant year of assessment.
Income Tax (Exemption) (No.4) Order 2021 [P.U. (A) 195/2021]
Effective from the year of assessment 2020 until the year of assessment 2025, tax exemption is granted for eligible conference promoters who carry on business or activity other than business or activity of promoting and organising conferences in Malaysia, including the arranging of accommodation, tours and sightseeing for foreign participants:-
need to bring in at least five hundred (500) foreign participants to attend conferences held in Malaysia on the basis year for a year of assessment; and
the exemption granted is on 100% of the statutory income derived from organising conferences held in Malaysia in the relevant assessment year.
The income tax exemption will apply only if the qualifying person brings in at least 500 foreign participants in the YA.
The PR reiterates that the exemption granted under P.U.(A) 500 or P.U.(A) 195 does not relieve the conference promoter or qualified person from the duty to submit any return, statement of accounts, or any other information as required under the ITA.
It is required that a separate account be kept to track the revenue that is exempted according to both orders.
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