Tax Update: Deductions for Secretarial Fees and Tax Filing Fees

The Inland Revenue Board of Malaysia (IRBM) has issued a new technical guidelines date 17th August 2022 on the deduction of expenses related to secretarial and tax filing fees from year of assessment 2022. The guide explains that secretarial and tax filing fees would normally not be deductible for tax purposes because they are not directly used in generating business income. However, from year of assessment 2015, secretarial and tax filing fees are deductible for eligible taxpayers doing business and resident in Malaysia.

The Income Tax Rules 2020 [P.U.(A) 162/2020] stipulate that a tax deduction of up to RM 15,000 per YA can be claimed for expenses incurred on secretarial and tax filing fees (i.e., the tax deduction limit for both secretarial and tax filing are combines)

The Income Tax Rules 2021 [P.U.(A) 471/2021] amended the Income Tax Rules 2020 with the removal of the words “and paid” thus allowing a deduction for secretarial and tax filing fees to be given to a resident who incurred the expenses.

The table above provides an overview of the deduction for Expenses concerning Secretarial and Fees Tax filing effective YA 2022.

Effective from YA 2022, tax deductions for expenses regarding secretarial and tax filing fees have been amended through Income Tax (Deduction for Expenses in relation to Fee Secretarial and Tax Filing Fees) (Amendment) 2021 [P.U. (A) 471/2021], which explains that expenses concerning secretarial and filing fees are eligible for deduction tax with the condition that is only ‘Incur