Double Deduction for Expenses

The Malaysian Government encourages taxpayers to incur certain expenses in their business by providing double tax deduction for such expenses in arriving at their adjusted income.

Generally, the pre-requisites for the claiming of double deduction are:

a. the expenses must be revenue expenditure

b. such expenses must be eligible under s 33 and not prohibited by s 39

c. the expenses are related to the business activity.

The following are some example of revenue expenses that are eligible for double deduction:

a. promotion of export

b. approved training

c. research and development, cash contribution to approved research institute

d. advertising expenses on Malaysian brand names

e. freight charges incurred by manufacturers to ship goods from Sabah and Sarawak via ports in Peninsular Malaysia

f. insurance premium paid for import/export of cargo insured with local insurance companies

g. employment of handicapped staff

h. expenses in obtaining certification for recognised quality systems and standards, and halal certification.