The policy of taxing overseas income at 3% has been delayed until 2026. Will the current administration shorten the exemption period?


The 3% oversea income tax policy has been delayed to 2026.

Prime Minister Anwar stated that he will conduct an in-depth study before making an announcement regarding the policy of 3% taxation on overseas income.

The previous administration announced a postponement of the 3% tax on foreign income to 2026. Prime Minister Datuk Seri Anwar said in this regard that he will announce it after studying it.

The previous government intended to collect taxes on repatriated overseas income beginning in 2022, but it changed its mind before then and postponed taxation on repatriated overseas income. Tax is not due on relevant payments until December 31, 2026.

This means that between 2022 and 2026, all personal overseas income, dividend income from corporations, and limited liability partnerships will be tax-free. Individuals with overseas income are exempt, but those who run a partnership business in Malaysia are not.

To ensure that all Malaysian residents are treated equally, the government intends to levy income tax on all foreign-sourced income. Both income earned abroad and income earned at home should be taxed because everyone benefits equally from the government’s facilities and conveniences.

You May Also Like…

%d bloggers like this: