BBFT3014/BBFT3013 ADVANCED TAXATION

T.2: Suggested answer to Q3(e) Appendix I

MyVictory Sdn. Bhd.
Computation of Tax payable

Year of assessment 2020 2021 2022 2023 2024

RM'000 RM'000 RM'000 RM'000 RM'000
Business 1 (manufacturing - No ITA)
Adjusted income 0 0 300 1,000 1,500
Less: Capital allowance (CA) 0 0 300 1,000 1,500
Statutory income (SI) 0 0 0 0 0

Business 2 (manufacturing - ITA)

Adjusted income 0 2,000 6,000 10,000 14,000

Less: IBA & Capital allowance 0 2,000 6,000 10,000 8,400
Statutory income (SI) 0 0 0 0 5,600
Less: 60% of ITA restricted to 70% of SI 0 0 0 0 3,920
Statutory income (Not exempt: 30% of SI) 0 0 0 0 1,680

Aggreate business income (B1 + B2) 0 0 0 0 1,680

Less: Unabsorbed business loss b/f 0 0 0 0 1,220
0 0 0 0 460
Foreign dividend income (Para. 28, Sch. 6) Exempt Exempt Exempt Exempt Exempt
FD interest (Malaysia) 50 50 50 50 50
Rent (Malaysia) 60 60 60 60 60
Aggregate income (Biz & Non-Biz) 110 110 110 110 570
Less: Current year business loss under s44(2) 110 110 0 0 0
Food donation (approved inst.) 0 0 0 0 0
Cash donation (non-approved inst.) 0 0 0 0 0
Cash donation SS Govt. 0 200 200 200 220
Total income/Chargeable income 0 0 0 0 350

Tax payable @ 24% 0 0 0 0 84

Exempt income account

Balance b/f - - - - -
Current year - - - - 3,920
Balance c/f - - - - 3,920
BBFT3014/BBFT3013 ADVANCED TAXATION

T.2: Suggested answer to Q3(e) (cont'd) 2020 2021 2022 2023 2024
RM'000 RM'000 RM'000 RM'000 RM'000
Qualifying capital expenditure for ITA

Plant & machinery 10,000 - 1,500 2,000 -

Factory 9,000 - - - -
Factory land 0 - - - -
Extension of factory - - - 7,000 -
Office equipment & Furniture & Fittings 0 - - 0 -
Total qualifying capital expenditure 19,000 0 1,500 9,000 0
ITA at 60% of QCE 11,400 0 900 5,400 0

Investment Tax Allowance (ITA)

Balance b/f - 11,400 11,400 12,300 17,700
ITA claim for the year 11,400 - 900 5,400 0
11,400 11,400 12,300 17,700 17,700
Less: Utilized amount 0 - - - 3,920
Balance c/f 11,400 11,400 12,300 17,700 13,780

CA (Manufacturing - Biz 1 - No ITA)

Balance b/f - 1,000 2,000 2,500 2,300
CA claim for the year 1,000 1,000 800 800 800
1,000 2,000 2,800 3,300 3,100
Less: Utilized amount 0 - 300 1,000 1,500
Balance c/f 1,000 2,000 2,500 2,300 1,600

IBA & CA (Manufacturing - Biz 2 - ITA)

Balance b/f - 5,600 9,000 8,200 3,400
IBA & CA claim for the year 5,600 5,400 5,200 5,200 5,000
5,600 11,000 14,200 13,400 8,400
Less: Utilized amount 0 2,000 6,000 10,000 8,400
Balance c/f 5,600 9,000 8,200 3,400 0

Business loss (both businesses)

Balance b/f - 850 1,220 1,220 1,220
Current year business loss (B1 + B2) 960 480 * 0 0
960 1,330 1,220 1,220 1,220
Less: Utilized amount 110 110 0 0 1,220
Balance c/f 850 1,220 1,220 1,220 0

*480 - 110 =370