Faculty
: Management and Economics Department
: Accounting
Finance Semester/Session : Semester 2 Session 2020/2021 (Semester A202)
Course Code / Name : PAT3033 Taxation
and
INDIVIDUAL ASSIGNMENT I:
DETERMINATION OF RESIDENCE STATUS OF INDIVIDUALS AND COMPANIES (4%)
The Objective of the Assignment:
This assignment is aimed to develop students understanding on the Individual taxpayers
(Section 7 (1) (a) to Section 7 (1) (d)), company (Section 8 (1)), advantages and
disadvantages to both residents and non-residents.
Question 1
Janson who had previously always lived in Malaysia, returned to Malaysia on July 1, 2012 and
having stayed in Thailand throughout the past 4 years. He commenced employment with a
Singapore company in September 2012, overseeing his employer’s operation in Singapore and
Malaysia. The record of stay in Malaysia from 2012 to 2017 is as follows:
Year
2012
2013
In Malaysia
No. of days
1 July – 31 August
62
7 December – 31 December
25
1 January – 14 June
166
15 June – 18 June
2014
Note
New York for visiting his brother
undergoing medical treatment
4
19 June – 8 July
20
10 November – 29 December
50
30 December – 5 January
To Korea to attend seminar
7
2015
6 January – 27 July
200
2016
11 April – 20 April
10
2017
10 March – 30 April
52
16 July – 31 August
47
Required: Determine the residence status of Janson for the relevant years of assessment.
YA
2012
Residence
Period of
status
stay
Sec 7 (1) (b)
1.7.2012-
Remarks
No of days
Reason
In Malaysia
87
In Malaysia less
31.12.2012
2013
Sec 7(1) (a)
1.1.2013-
than 182 days
In Malaysia
186
8.7.2013
2013
Sec 7 (1) (b)
In Malaysia more
than 182 days
15.8.2013-
New York for
4
Temporary
18.8.2013
visiting his
absence due to
brother
owing to ill health
undergoing
medical
treatment
2014
Sec 7 (1) (b)
10.11.2014-
In Malaysia
50
29.12.2014
2014
Sec 7 (1) (b)
In Malaysia less
than 182 days
30.12.2014-
To Korea to
31.12.2014
attend seminar
2
Temporary
absence due to
seminar
2014
Sec 7 (1) (b)
1.1.2015-
To Korea to
5.1.2015
attend seminar
5
Temporary
absence due to
seminar
2015
Sec 7 (1) (a)
6.1.2015-
In Malaysia
200
7.7.2015
2016
Sec 7 (1) (d)
11.4.2016-
In Malaysia more
than 182 days
In Malaysia
10
20.4.2016
He is resident for
the particular
basis year even
though the
individual might
not have been in
Malaysia at all in
that particular
basis year.
2017
Sec 7 (1) (c)
16.7.201731.8.2017
In Malaysia
99
In Malaysia more
than 90 days
Question 2
Zhi Chia, China’s citizen, was employed as an engineer by Kam Sdn Bhd for the developing
several project in Malaysia. His periods of stay in Malaysia were as follows:
Project in Ipoh
Project in KL
Project in Proton City
From 1.3.2010 until 2.8.2010 and from 1.12.2010 until 15.4.2011
From 1.5.2012 to 16.11.2012
From 1.9.2013 to 30.4.2014 except for Christmas leave from
21.12.2013 to 2.1.2014
Zhi Chia returned to Malaysia again on 1.6.2015 as technical consultant with Behrang Holdings
for a short assignment lasting until 30.7.2015. On 1.11.2016, he returned to Malaysia as a project
manager with Behrang Holdings and was present in the country until 1.4.2017 when he went back
to China on sick leave for 10 days. He rushed back to Beijing on 20.6.2017 upon receiving news
that his wife was involved in an accident and returned to Malaysia on 1.7.2017. In view of his
wife’s health condition, Zhi Chia decided to resign and joined his wife in Beijing on 24.7.2017.
Required:
Determine the residence status of Zhi Chia for the year of assessment 2010 to 2017, both years
inclusive. Use this format for your answer.
Year of
assessment
2010
Period of
No of
Residence
stay
days
status
1.3.2010 -
155
Sec 7 (1) (b)
Remarks
Project in ipoh
2.8.2010
Reason
In
Malaysia
less than
182 days
2010
1.12.2010 -
31
Sec 7 (1) (b)
Project in ipoh
31.12.2010
In
Malaysia
less than
182 days
2011
1.1.2011-
105
Sec 7 (1) (b)
Project in ipoh
15.4.2011
In
Malaysia
less than
182 days
2012
1.5.2012 –
16.11.2012
200
Sec 7 (1) (a)
Project in KL
In
Malaysia
more than
182 days
2013
1.9.2013 –
122
Sec 7 (1) (b)
31.12.2013
Project in
In
Proton City
Malaysia
less than
182 days
2014
1.1.2014-
120
Sec 7 (1) (b)
30.4.2014
Project in
In
Proton City
Malaysia
less than
182 days
2013
21.12.2013
11
Sec 7 (1) (b)
-
Christmas
Social visit
leave
less than
31.12.2013
2014
1.1.2014-
14 days
2
Sec 7 (1) (b)
2.1.2014
Christmas
Social visit
leave
less than
14 days
2015
1.6.2015 –
60
Sec 7 (1) (b)
30.7.2015
2016
1.11.2016-
61
Sec 7 (1) (b)
31.12.2016
2017
1.1.2017-
90
Sec 7 (1) (c)
31.3.2017
2017
1.4.201710.4.2017
10
Sec 7 (1) (b)
Technical
In
consultant with
Malaysia
Behrang
less than
Holdings
182 days
Project
In
manager with
Malaysia
Behrang
less than
Holding
182 days
Project
In
manager with
Malaysia
Behrang
for 90
Holding
days
Sick leave
Temporary
absence
due to
owing to ill
health
2017
20.6.2017-
11
Sec 7 (1) (b)
Wife accident
31.6.2017
Temporary
absence
due to
owing to ill
health
2017
1.7.2017-
23
Sec 7 (1) (b)
In Malaysia
23.7.2017
In
Malaysia
less than
182 days
Question 3
Mr Teng, a Malaysian citizen, decided to accept a lucrative offer by a petroleum company in
Brunei. He left Malaysia on November 1, 2016 and worked for two years in Brunei. When his
contract ended, he came back to Malaysia on 15 November 2018. He has not left Malaysia since
then.
Determine Mr Teng’s tax residence status for the years of assessment 2016 to 2018, stating the
conditions and the relevant provisions of the Income Tax Act 1967.
YA
Period of stay
No of days
Remarks
Residence status
2016
1.1.2016-
305
In Malaysia
Sec 7 (1) (a)
61
Brunei
Non Resident
365
Brunei
Non Resident
318
Brunei
Non Resident
47
In Malaysia
Sec 7 (1) (b)
3110.2016
2016
1.11.201631.12-2016
2017
1.1.201731.12.2017
2018
1.1.201814.11.2018
2018
15.11.201831.12.2018
Mr Teng is resident in year assessment 2016 under Section 7 (1) (a) of the ITA 1967.He was in
Malaysia for more than 182 days which is 305 days. For the year assessment after
31.10.2016,2017 and until 14.11.2018, Mr Teng was not a resident because not meeting all
condition. After 14.11.2018, 15.11.2018,Mr Teng was resident until the end of 2018 under Sec 7
(1) (b) of the ITA 1967.He was in Malaysia less than 182 days which is 47 days.
Question 4
Ronaldo, a Brazil engineer, arrived in Malaysia on a five year contract with a multi-national
corporation based in Kuala Lumpur on 1 October 2014. His pattern of stay for the next five years
is as follows:
Year of
Period of stay
Remarks
assessment
2014
1.10.2014 –
Malaysia
No of
Residence
days
Status
92
Sec 7 (1) (c)
31.12.2014
Reason
In
Malaysia
for more
than 90
days
2015
1.01.2015 –
Malaysia
31
Sec 7 (1) (b)
31.01.2015
In
Malaysia
less than
182 days
2015
1.02.2015 –
France
16
16.02.2015
Non
Not in
Resident
Malaysia
for more
than 14
days
2015
17.02.2015 –
31.07.2015
Malaysia
166
Sec 7 (1) (b)
In
Malaysia
less than
182 days
2015
1.08.2015 –
Singapore
7
Sec 7 (1) (b)
07.80.2015
Not in
Malaysia
for less
than 14
days
2015
8.08.2015 –
Malaysia
145
Sec 7 (1) (b)
31.12.2015
In
Malaysia
less than
182 days
2016
1.01.2016 –
Malaysia
31
Sec 7 (1) (b)
31.01.2016
In
Malaysia
less than
182 days
2016
1.02.2016 –
Germany
31.05.2016
(official visit)
121
Sec 7 (1) (b)
Attending
service
matters in
Germany
2016
1.06.2016 –
Malaysia
61
Sec 7 (1) (b)
31.07.2016
In
Malaysia
less than
182 days
2016
1.08.2016 –
Indonesia
30.10.2016
(official visit)
91
Sec 7 (1) (b)
Attending
service
matters in
Indonesia
2016
31.10.2016 –
Malaysia
62
Sec 7 (1) (b)
31.12.2016
In
Malaysia
less than
182 days
2017
1.01.2017 –
Tokyo (official
30.04.2017
visit)
121
Sec 7 (1) (b)
Attending
service
matters in
Tokyo
2017
1.05.2017 –
Malaysia
92
Sec 7 (1) (c)
31.05.2017
In
Malaysia
for more
than 90
days
2017
1.08.2017 –
Hong Kong
31.12.2017
(official trip)
153
Sec 7 (1) (b)
Attending
service
matters in
Hong
Kong
2018
1.01.2018 –
1.05.2018
Malaysia
121
Sec 7 (1) (b)
In
Malaysia
less than
182 days
Ronaldo terminated his contract prematurely and left Malaysia for good on 1 May 2018 for Brazil
as he wanted to spend more time with his family.
REQUIRED
Determine the residence status of Ronaldo for the year of assessment 2014 to 2018, and provided
appropriate reasons for your answer.
Question 5
Mrs Endang arrived in Malaysia for the first time on 1 March 2015 when she accompanied her
husband who was assigned to Malaysia as an Advisor to the Indonesian Ambassador in Kuala
Lumpur. The pattern of stay for Mrs Endang in Malaysia are listed below.
1 Mar 2015 – 31 Mar 2015
12 Apr 2015 – 31 Dec 2015
1 Oct 2016 – 31 Dec 2016
1 Oct 2017 – 20 Dec 2017
4 Jan 2018 – 17 June 2018
4 Jul 2018 – 31 Dec 2018
1 Jan 2019 – 31 Mar 2019
Since she has a Master Degree in Economics, she secured a job with Kolej Putra in Kuala Lumpur
as a lecturer on 15 March 2015. She was in Malaysia until 31 March 2015 when she left for
Singapore attending a Seminar in Economics. She arrived in Malaysia on 12 April 2015.
On 31 December 2015 she left for Indonesia to visit her mother who was hospitalized in Hospital
Nasional Indonesia and return to Malaysia on 1 October 2016.
She left Malaysia again on 31 December 2016 to take care of her bedridden mother. She was in
Indonesia until 30 September 2017.
Mrs Endang went to Australia on the 20 December 2017 to attend a conference in Global
Economics sponsored by Kolej Putra. She came back to Malaysia on 4 January 2018. On 17 June
2018 Mrs Endang and her family went to Singapore for a holiday and came back to Malaysia on
4 July 2018.
Mrs Endang completed her term of employment on 31 March 2019 and left Malaysia for good on
the same day.
Required:
a. Determine the residence status of Ms Endang for the relevant years of assessment until
the year of assessment 2019.
Year
of
Period of
No
assessment
stay
days
status
2015
1
31
Sec 7 (1) (b)
Mar
of
Residence
Remarks
Reason
In Malaysia
In
2015 – 31
Malaysia
Mar 2015
less
than
182 days
2015
1
April
11
Sec 7 (1) (b)
Attending
Temporary
2015-11
Seminar at
absence
April 2015
Singapore
in Economics
due to
seminar
2015
12
Apr
275
Sec 7 (1) (a)
In Malaysia
In
2015 – 31
Malaysia
Dec 2015
more than
182 days
2016
1
Jan
273
Sec 7 (1) (b)
Visit mother
Temporary
2016-30
that
absence
Sept 2016
hospitalized
due to
in Indonesia
owing to ill
health
2016
1
Oct
92
Sec 7 (1) (c)
In Malaysia
In
2016 – 31
Malaysia
Dec 2016
more than
90 days
2017
1
Jan
273
Sec 7 (1) (b)
Visit mother
Temporary
2017-30
that
absence
Sept 2017
bedridden in
due to
Indonesia
owing to
health
2017
1
Oct
81
Sec 7 (1) (b)
In Malaysia
In
2017 – 20
Malaysia
Dec 2017
less
than
182 days
2017
21
Dec
11
Sec 7 (1) (b)
2017-31
Conference
Temporary
in Australia
absence
Dec 2017
due
to
conference
2018
1.1.20183.1.2018
3
Sec 7 (1) (b)
Conference
Temporary
in Australia
absence
due
to
conference
2018
4
Jan
165
Sec 7 (1) (b)
In Malaysia
In
2018 – 17
Malaysia
June 2018
less
than
182 days
2018
18
June
16
2018-3 Jul
Non
Went to
Social visit
Resident
Singapore
more than
for holiday
14 days
In Malaysia
In
2018
2018
4 Jul 2018
181
Sec 7 (1) (b)
– 31 Dec
Malaysia
2018
less
than
182 days
2019
1
Jan
90
Sec 7 (1) (c)
In Malaysia
In
2019 – 31
Malaysia
Mar 2019
for 90 days
b. Briefly explain the meaning of ‘temporary absence’ under Sec 7(1)(b) of Income Tax Act
1967.

Connected with his service in Malaysia and
owing to service matters or attending
conferences, seminars or workshop abroad

Owing to ill health involving himself or a member of his immediate family

Social visit not exceeding 14 days in the aggregate