BKATK3023 ADVANCED TAXATION
A251 FIRST SEMESTER 2025/2026
TUTORIAL QUESTION (PART 2)
BKATK3023 ADVANCED TAXATION
Dr. Aryati Juliana binti Sulaiman [Date] BKATK3023
BKATK3023 ADVANCED TAXATION
CHAPTER 5: COMPANY TAXATION
QUESTION 1
Makerz Sdn Bhd (MSB) is a resident shoes manufacturer with a paid-up share capital of
RM2.8 million as of 1 October 2023. The company has been in operation since 2018 and
closes its accounts on 30 September annually. The following financial and tax information is
extracted from its financial statements and tax records:
Makerz Sdn Bhd
Statement of Profit or Loss and other Comprehensive Income
for the year ended 30 September 2025
Note RM ‘000 RM ‘000
Sales 20,000
Less: Cost of sales 1 (9,500)
Gross profit 10,500
Add: Other income
Interest from Goodguys Ltd (Australia) 2 600
Rental income 1,200
12,300
Less: Business Expenses:
Salaries and wages 3 874
Sales and marketing 4 350
Repair and maintenance 5 980
Foreign exchange loss 6 500
Professional fees 7 220
Bad debts 8 150
Miscellaneous expenses 9 480 3,554
Net Profit Before Tax 8,746
Notes to the accounts:
1. Cost of sales includes stocks taken as promotional gifts to customers which were
recorded at a cost of RM7,200. The selling price was RM10,250.
2. The interest was fully remitted to Malaysia. It was subjected to 15% Australian
withholding tax.
3. Salaries and wages comprise of:
RM
Gross salaries (10% was related to salaries of disabled employees) 700,000
Contribution to Employees’ Provident Fund (EPF) 150,000
Internship allowance of RM1,000 per month for two full-time
undergraduate students. The internship programme was approved by
Talent Corporation Malaysia Berhad 24,000
4. Sales and marketing include:
RM
BKATK3023 ADVANCED TAXATION
Rental of a foreign warehouse for the purpose of promotion of export 108,000
Trip to Sabah as an incentive to sales agent for achieving sales target 70,000
Entertainment to potential customers 55,000
Reimbursement to marketing staff for entertaining customers 17,000
5. Repair and maintenance include:
RM
Repair of buildings (20% was related to rented property and the
remaining was related to factory buildings) 500,000
Quit rent and assessment for calendar year 2025 of the rented property 24,000
Renovation of the company’s office 100,000
Depreciation 250,000
6. Foreign exchange loss comprises of:
RM
Unrealised losses due to purchase of raw materials 300,000
Realised losses due to purchase of machinery 250,000
Realised gain from trade creditors (50,000)
7. Professional fees comprise of:
RM
Secretarial and tax filing fees 22,000
Annual audit fees 33,000
Legal fees for renewal of rental agreement to tenant 44,000
Consultation fee for e-invoicing implementation 55,000
Insurance premium for exporting cargo with local insurance
companies 66,000
8. Bad debts include RM130,000 bad debts written off and RM160,000 bad debts
recovered. The remaining was general provision of bad debts.
9. Miscellaneous expenses include:
RM
BKATK3023 ADVANCED TAXATION
Leave passage for employees for company’s annual family day in
Indonesia 110,000
Cash donation to approved institution 150,000
Business Zakah paid to Baitulmal (Islamic charity) 170,000
Additional information:
i. The capital allowance and balancing charge for the year of assessment 2025
amounted to RM300,000 and RM9,000 respectively.
ii. Brought forward business loss from previous year of assessment was RM255,000.
iii. All relevant documentation is kept accordingly.
REQUIRED:
Compute tax payable of Makerz Sdn Bhd for the year of assessment 2025. Indicate every
adjustment in your answer or ‘NIL’ if no adjustment is required.
QUESTION 2
Portomerion Sdn Bhd (PSB) is a resident company manufacturing pottery product with a paid-
up share capital of RM2 million as of 1 August 2024. The company has been in operation
since 2020 and closes its accounts on 31 July annually. The following financial and tax
information is extracted from its financial statements and tax records:
Portomerion Sdn Bhd
Statement of Profit or Loss and other Comprehensive Income
for the year ended 31 July 2025
Note RM RM
Sales 1,200,000
Less: Cost of sales 1 (90,500)
Gross profit 1,109,500
Add: Other income
Dividend from Kossan Ltd (Japan) 2 15,000
Rental income 36,000
1,160,500
Less: Business Expenses:
Salaries and wages 3 475,000
Sales and marketing 4 88,000
Repair and maintenance 5 105,000
Foreign exchange loss 6 40,000
Professional fees 7 81,000
BKATK3023 ADVANCED TAXATION
Bad debts 8 50,000
Miscellaneous expenses 9 135,000 974,000
Net Profit Before Tax 186,500
Notes to the accounts:
1. Cost of sales includes withdrawals of stock which was recorded at cost of RM720. No
record in sales was found. The selling price was RM1,250. The stock was given as a
wedding gift to the director’s daughter.
2. The dividend was credited on 23 August 2024 and fully remitted to Malaysia. It was
subjected to 15% Japan withholding tax.
3. Salaries and wages comprise of:
RM
Staff gross remuneration 200,000
Bonus 150,000
Contribution to Employees’ Provident Fund (EPF) 75,000
Staff training cost – training programme approved by Malaysian 50,000
Industrial Development Authority
4. Sales and marketing include:
RM
Participation in international trade fairs held in Malaysia (approved by 27,000
the Ministry of Trade & Industry)
Dinner to entertain suppliers 19,000
Sponsorship of sports attire for an open badminton tournament 5,300
Gift of flower for customers’ opening of new outlet 3,000
5. Repair and maintenance include:
RM
Maintenance of motor vehicles (RM8,000 was related to the Director’s 38,000
private car)
Quit rent and assessment for the basis period of the rented property 5,500
Upgrading of staff’s recreational room 25,000
Depreciation 15,000
Replace five air-conditioning units with new inverter unit at RM2,000 10,000
each
BKATK3023 ADVANCED TAXATION
6. Foreign exchange loss comprises of:
RM
Unrealised losses due to purchase of raw materials 30,000
Realised losses due to purchase of machinery 25,000
Realised gain from trade creditors (15,000)
7. Professional fees include:
RM
Secretarial and tax filing fees 22,000
Annual audit fees 13,000
Legal fees for rental agreement to new tenant 5,600
Consultation fee for e-invoicing implementation 16,000
Registration of patents overseas as part of promotion of export 24,000
8. Bad debts include RM60,000 bad debts written off and RM35,000 bad debts
recovered. The remaining was general provision of bad debts.
9. Miscellaneous expenses include:
RM
Employees leave passage for company’s annual family day in Sabah 25,000
Cash donation to approved organisation 50,000
Business Zakah paid to Lembaga Zakat Negeri Kedah 30,000
Additional information:
Capital allowances for the year of assessment 2025 (excluding the five air-conditioning units)
and loss brought forward from last year were RM70,000 and RM25,000 respectively. All
relevant documentation is kept accordingly.
REQUIRED:
Compute the tax payable of Portomeirion Sdn Bhd for the year of assessment 2025. Indicate
every adjustment in your answer or ‘NIL’ if no adjustment is required.
CHAPTER 7: SPECIALISED INDUSTRIES
QUESTION 1
A. Mawar Bhd (MB) is an investment holding company established in 2020 with an
objective to gain income from its investment. The following is the excerpt of profit or
loss and other comprehensive income for MB for the year ended 31 December 2025:
RM RM
Gross income:
Dividend from Malaysian company 150,000
Realized gains from investment 120,000
Management service fee 100,000
Interest from fixed deposit 220,000
Rental from apartments 110,000
700,000
Expenses:
Directors’ remuneration 80,000
Staff salaries 60,000
Secretarial and accounting fees 12,000
Audit fees 10,000
Printing and stationaries 15,000
Management expenses 22,000
Rental 36,000
Assessment for apartments 15,000
Maintenance of motor vehicle 21,000
Depreciation 34,000 305,000
Net profit 395,000
Additional Information:
Capital allowance for the year of assessment 2025 was RM44,000.
REQUIRED:
Compute chargeable income of Mawar Bhd for the year of assessment 2025 if the
company is listed on Bursa Malaysia.
BKATK3023 ADVANCED TAXATION
B. Muda Property REIT (MPR) is a listed and approved Reit Estate Investment Trust
(REIT). The company received income from various investments that generated rental
income, dividends, interest and capital gains. MPR showed the following information
of income and expenses for the year 2025:
RM RM
Income:
Dividend from Malaysian company 15,000
Rental (letting of apartments) 280,000
Interest (fixed deposit) 175,000
Interest (securities issued by government) 9,000
Gains on disposal of property 14,000
493,000
Expenses:
Entertainment for customers 3,200
Property manager fees 60,000
Property maintenance cost 78,000
Quit rent, assessment and insurance for property 16,000
Trustee’s fees 24,000
REIT manager’s fee 36,000
Depreciation 21,000
Interest on loan taken to invest in government 1,500
securities
General bad debt 14,000
Staff salary 38,000
Office expenses 18,000 309,700
Net profit 183,300
Additional information:
i. MPR claimed capital allowance of RM12,100 for the year of assessment 2025.
ii. MPR made RM40,000 as distribution to its unit holders for the basis period for
the year of assessment 2025.
REQUIRED:
(a) Compute total income and chargeable income of Muda Property REIT for the
year of assessment 2025. Indicate ‘NIL’ if no adjustment is required.
(b) Define ‘Real Estate Investment Trust’ according to the Securities
Commission.
BKATK3023 ADVANCED TAXATION
QUESTION 2
A. Shree Bhd (SB) is an investment holding company from 2020 with an objective to gain
income from its investment.
The following is the excerpt of income statement for SB for the year ended 31
December 2025:
RM RM
Gross income:
Dividend from Malaysian company 150,000
Realized gains from investment 120,000
Management service fee 100,000
Interest from fixed deposit 220,000
Rental from apartments 110,000
Expenses: 700,000
Directors’ remuneration 80,000
Staff salaries 60,000
Secretarial and accounting fees 12,000
Audit fees 10,000
Printing and stationaries 15,000
Management expenses 22,000
Rental 36,000
Assessment for apartments 15,000
Maintenance of motor vehicle 21,000
Depreciation 34,000 305,000
Net profit 395,000
Additional Information:
Capital allowance for the year of assessment 2025 was RM44,000.
REQUIRED:
Compute chargeable income for Shree Bhd for the year of assessment 2025 if the
company is not listed on Bursa Malaysia.
BKATK3023 ADVANCED TAXATION
B. Leo Unit Trust (LUT) is a unit trust company have been in operating by investing in
shares, finance and properties since 2020.
The following is the excerpt from income statement for LUT for the year ended 31
December 2025 is as follows:
RM RM
Income:
Dividend from TMT Bhd (a pioneer status company) 120,000
Interest from fixed deposit 105,000
Interest from Malaysia (exempted) 140,000
Rental from apartments 180,000
Gain on disposal of shares 100,000
645,000
Expenses:
Manager remuneration 48,000
Maintenance of register of unit holders 12,000
Share registration expenses 11,000
Audit, accounting and secretarial 16,000
Stationeries and postage 14,000
Trustee’s fees 24,000
Apartments maintenance 87,000
Assessment and quit rent (30% for apartments) 7,000
Fire insurance (60% for apartments) 13,000
Depreciation 32,000 264,000
Net profit 381,000
Additional Information:
10 units of apartments were purchased by LUT in 2024 and was rented from 1 January
2025. LUT spent RM300,000 cost to buy the elevators and another RM150,000 for the
installation cost to install the elevators before the apartments been rented out.
REQUIRED:
Calculate chargeable income for Leo Unit Trust for the year of assessment 2025.
Indicate ‘NIL’ if no adjustment is required.
C. Venture Capital Company is governed by the Capital Markets and Services Act 2007
(CMSA) and must register with the Securities Commission. It is a company that
provides venture capital in venture company.
REQUIRED:
State TWO (2) tax exemptions available for a venture capital company.
BKATK3023 ADVANCED TAXATION
CHAPTER 8: TRUST BODY
QUESTION 1
Zainab Trust is a trust body resident in Malaysia, established by Zainab for her husband,
Rashid, and their three children (Lina, Ali, and Omar) before her demise. The trustee of the
trust is Faizal. Below is the financial information reported for the financial year ended 31
December 2025:
RM
Income:
Adjusted business income 1,500,000
Rental income from commercial properties in Johor 420,000
Dividend from listed Malaysian companies 110,000
Interest income from corporate bonds 180,000
Gain from disposal of building 150,000
Expenses:
Trust remuneration 48,000
Quit rent and assessment for rented properties 45,000
Cash donation to an approved orphanage 3,000
Annuity paid to Rashid 60,000
Repair and maintenance for rented properties 30,000
Additional information:
i. Rashid was entitled to 50% of the distributable income, and the remaining 50% was
distributed equally to Lina and Ali at the discretion of the trustee.
ii. Omar, the youngest, was under 18 and entitled to receive a fixed annual amount of
RM20,000, which was accumulated until he reaches 21 in the year 2027.
iii. Lina and Ali received RM120,000 and RM115,000, respectively from the trust for the
financial year 2025.
iv. An amount of RM60,000 for the purchase of motor vehicles used in the business was
deducted in arriving at the adjusted business income.
v. Capital allowance claimed for the year of assessment 2025 amounted to RM100,000.
REQUIRED:
(a) Compute total income and distributable income of the trust for the financial year
ended 31 December 2025.
(b) Compute the total income received by each of the beneficiaries from the trust.
BKATK3023 ADVANCED TAXATION
QUESTION 2
Ahmad Trust is a trust body resident in Malaysia, established by Ahmad for his wife, Aisyah,
and their three children (Farah, Idris, and Jamil) before his passing. The trustee of the trust is
Azman. Below is the financial information reported for the financial year ended 31 December
2025
RM/year RM/month
Income:
Adjusted business income 1,200,000
Rental income from commercial properties in Selangor 360,000
Dividend from listed Malaysian companies 94,000
Interest income from government bonds 150,000
Gain from disposal of building 130,000
Expenses:
Trust remuneration 3,500
Quit rent and assessment for rented properties 40,000
Cash donation to an approved orphanage 2,500
Annuity paid to Aisyah 4,000
Repair and maintenance for rented properties 25,000
Additional information:
i. Aisyah is entitled to 50% of the distributable income, and the remaining 50% is
distributed equally to Farah and Idris at the discretion of the trustee.
ii. Jamil, the youngest, is under 18 years old and receives a fixed annual amount of
RM18,000, which is accumulated until he reaches 21 years old in the year 2027.
iii. Farah and Idris received RM90,000 and RM85,000, respectively, from the trust for the
financial year 2025.
iv. An amount of RM50,000 for the purchase of office equipment has been deducted in
arriving at adjusted business income.
v. Capital allowance for the current year amounted to RM80,000.
REQUIRED:
(a) Compute the total income and distributable income of Ahmad Trust for the year of
assessment 2025.
(b) Compute the total income received from the trust for each of the beneficiaries.
BKATK3023 ADVANCED TAXATION
CHAPTER 9: COOP, TA & CLUBS
QUESTION 1
A. Sintok Food Operators Co-operative (SFOC) was established in 2012 to cater for the
food needs of students and staff at Universiti Utara Malaysia (UUM) in Kedah. SFOC's
financial year ends on 31 December annually. Below is the income statement for the
year ended 31 December 2025:
Sintok Food Operators Co-operative
Income Statement for the year ended 31 December 2025
RM RM
Sales 852,000
Less: Cost of goods sold 130,000
Gross profit 722,000
Add: Rental income 24,000
746,000
Less: Expenses
Administrative 125,000
Donations 11,000
Depreciation 7,000
Business zakat 4,000 147,000
Net profit 599,000
Additional information:
i. The capital allowance for the year of assessment 2025 is RM8,000.
ii. Donation was made to an approved charitable institution and the business
zakah was paid to the Lembaga Zakat Negeri Kedah.
iii. Details of the members’ fund as at 1 January 2025 are as below:
RM
Paid up share capital 450,000
Subscribed capital 120,000
Share premium account 55,150
Reserve from revaluation of land 60,000
Statutory reserve fund 48,000
Retained earnings 88,520
821,670
iv. The following are the amounts that were transferred to various funds:
RM
Contribution to co-operative trust fund 5,000
Transfer to statutory reserve fund 12,000
REQUIRED:
Compute chargeable income of Sintok Food Operators Co-operative for the year of
assessment 2025.
BKATK3023 ADVANCED TAXATION
B. Jitra Online Traders Association (a Malaysian tax resident) was formed in 2022. The
association has submitted the following income statement for the year ended 31
December 2025:
Jitra Online Traders Association
Income Statement for the year ended 31 December 2025
RM RM
Income:
Entrance fees 139,400
Members’ subscription fees 320,000
Special donationa 19,800
Interest income 56,000
Rental income 12,000
547,200
Expenses:
Utilities 30,000
Office expenses 84,800
Depreciation 35,000
Wages for staff 18,000 (167,800)
Surplus for the year 379,400
Note: RM
a
Special donation received for repairs of the association building 106,000
Less: Cost of repairs to the building 86,200
Surplus 19,800
Additional information:
Capital allowance for the year of assessment 2025 amounted to RM127,200.
REQUIRED:
(a) Compute the total common expenses for Jitra Online Traders Association.
(b) Compute the exempted statutory income from members’ subscription fee.
C. Explain TWO (2) tax treatments that are relevant to the principle of mutuality for clubs.
BKATK3023 ADVANCED TAXATION
QUESTION 2
A. Sinton Cooperative Bhd has been a co-operative society since 2010. The following is
the excerpt from income statement for the year ended 31 December 2025:
Items RM RM
Income:
Sales 264,000
Membership fees 12,000
Interest income 11,000
Rental 26,000
Dividend from a Malaysian company 15,000 328,000
Expenditures:
Board meeting allowance 11,000
Remuneration for staff 48,000
Audit fees 2,000
Depreciations 14,000
Donations 11,000
Utilities 21,000
Entertainment for customer 15,000
Stationeries 31,000 153,000
Net Profit 175,000
Additional information:
i. Members fund as at 1 January 2025 RM
Share capital 350,000
Members’ fees capital 133,000
Educational institution fund 30,000
Development trust fund 75,000
Statutory reserve fund 72,000
Revaluation reserve 68,000
Retained earnings 91,000
ii. Amount transferred to various funds: RM
Statutory reserve fund 14,000
Co-operative education fund 22,000
Co-operative development fund 34,000
iii. Donations include RM5,000 to an approved institution.
REQUIRED:
Compute the chargeable income for Sinton Cooperative Bhd for the year of
assessment 2025.
BKATK3023 ADVANCED TAXATION
B. Thua Trade Association (TTA) was formed since 2000 to assist its members doing
trading business in Alor Setar. The following is the excerpt from income statement for
the year ended 31 December 2025:
Items RM RM
Income:
Members’s subscription fees 20,000
Entrance fees 130,000
General Donations 10,000
Training fees 16,000
Rental income from sub lease 21,000
Interest from fixed deposit 11,000
208,000
Expenditures:
Staff salaries 16,000
Administrative expenses 18,000
Utilities 14,000
Office maintenance 10,000
Rental of hall for training 2,000 60,000
Surplus 148,000
Additional information:
Capital allowance for the year of assessment 2025 amounted to RM10,000.
REQUIRED:
Compute the following for Thua Trade Association for the year of assessment
2025:
(a) Total of common expenses;
(b) Exempted statutory income from members’ subscription fees.
C. Explain the tax treatment for income received from members and non-members for a
club.
BKATK3023 ADVANCED TAXATION
CHAPTER 10: RPGT
QUESTION 1
Nayla bought a house for RM450,000. The purchase agreement was signed on 1 March 2021
and the house was transferred to her on 1 May 2021 upon approval of the bank loan. She paid
RM5,000 to her agent and the valuation fee was RM45,000. The legal fees included a
conveyance fee of RM7,200, legal fees of RM6,700 for the loan and stamp duty of RM4,500
paid to her lawyer.
In June 2023, she spent RM120,000 for renovation cost of the house. In August 2023, there
was a landslide, that caused damage to her house. A contractor paid her a total of RM100,000
as settlement and an insurance company also paid her RM150,000 for the damages under a
contract of insurance.
Nayla decided to sell the house and engaged an agent. Haris, a prospective buyer, wanted to
buy the house for RM600,000 and Nayla agreed. Haris paid a deposit of RM60,000, but his
bank loan application was not successful, and the deal was called off resulting in the forfeiture
of the deposit.
Nayla finally sold the house to Aiden for RM620,000. She incurred agent fees of RM5,500,
valuation fees of RM35,000 and legal fees of RM11,540. The sales agreement was signed on
20 March 2025 and the house was duly transferred to Aiden on 20 April 2025. By the date of
transfer, Nayla paid bank interest of RM138,500 on the loan taken to acquire the house.
REQUIRED:
Calculate the chargeable gain or loss arising from the disposal of the property after considering
the exemption under Schedule 4 of the Real Property Gains Tax 1976 (as amended).
QUESTION 2
Maher, a Malaysian citizen, acquired a commercial lot for RM230,000 in April 2019. He
incurred stamp duty and legal fee of RM2,000 and RM1,700 respectively, upon purchase. In
February 2021, Maher decided to sell off the property. He advertised for the sale and a buyer
responded and paid a deposit of RM9,000, after some initial negotiation. The buyer was not
successful in obtaining a bank loan to buy the property and Maher forfeited the deposit of
RM9,000.
The property had been transferred from Maher to Saher Sdn Bhd (SSB) on 2 April 2022 for
RM650,000. Maher and his wife, Sarah, are the only shareholders of SSB and they held 100%
shares in the company at the time of transfer. The transfer consideration was satisfied in full
by the issue of ordinary shares in SSB. The company carried out renovation works to the
property which cost RM72,000. SSB sold the property to R Jay Sdn Bhd for RM840,000 on
4 October 2024. SSB incurred valuation fee of RM5,750, brokerage fee RM7,270 and agent
fee of RM450 in respect of the disposal.
REQUIRED:
(a) Determine with reason whether Maher will be subject to real property gains tax on his
disposal of commercial lot to Saher Sdn Bhd.
(b) Calculate the real property gain tax payable by Saher Sdn Bhd for the disposal of the
property under the Real Property Gain Tax Act 1976.