Finance Minister II Datuk Seri Amir Hamzah Azizan said that the government has agreed to exempt unit trusts from being subjected to the implementation of the capital gains tax (CGT) and tax on foreign-sourced income (FSI). Specifically, the exemption from the CGT will take effect from 1 January 2024 to 31 December 2028, while the exemption from FSI tax will be effective from 1 January 2024 to 31 December 2026.

“Through the various engagements we have had on this matter, it has come to our attention that one unintended area impacted by CGT is unit trusts, given that more than 90% of unit trust holders are individuals. I want to assure you that this government values feedback and engagement. I am pleased to announce that the government has agreed to exempt the imposition of CGT as well as taxes on FSI on unit trusts,” said Datuk Seri Amir Hamzah.

The minister also went on to stress that the government’s introduction of the CGT under Budget 2024 was always meant to be applicable to a specific scope; it is focused on gains from the disposal of unlisted shares by companies. Disposal of listed shares and disposals by individuals are not subjected to CGT, he said. 

With this, Datuk Seri Amir Hamzah said that the government hopes the people can continue to benefit fully from the gains of their hard-earned money. They can also invest in their future without worry.

For context, Malaysia had proposed under Budget 2024 to impose a 10% capital gains tax on the profit received from the disposal of unlisted shares in local companies, starting from 1 March 2024 onwards. This is also extended to include the disposal of shares in a controlled company that is outside of Malaysia but owns real property in Malaysia, or shares in another controlled company. On top of that, the government had also proposed then to impose tax on the gains received from the disposal of capital assets outside of Malaysia (foreign-sourced income), which include real property overseas and shares on foreign stock exchanges.

With the date of implementation of the CGT drawing near, the public had subsequently sought further clarification on the treatment of the tax for specific deals and investment products, such as those involving unlisted shares by private equities and unit trust funds.

(Source: The Edge Malaysia)

• TAGS:
• Capital Gains Tax
• Datuk Seri Amir Hamzah Azizan
• Foreign-Sourced Income
• Foreign-Sourced Income Tax
• Unit Trust Funds
• Unit Trusts