Re: MM2H Fixed Deposit
 

As the Malaysian curency is restricted, I would not think that any bank outside Malaysia would agree to hold accounts in that currency.

I guess that the answer whether it is allowed to keep an account after terminating the MM2H or not depends on who you ask.
I know also lots of people who opened accounts without having the MM2H visa or approval letters.

In general, banks have some regulations on Opening accounts, but once that is done you're safe unless of course there are some strict Gov't regulations.
To try to shed some more light on this, I will mail the question to one of my MY bank contacts.

Re: MM2H Fixed Deposit
 

Thanks Gunnar45...appreciate that so I can be pre-armed.
Thinking aside of the visa issue, I note that the MYR, due to the oil price dropping, is the worst performing currency in Asia...against the USD.
However, as I now permanently reside in Bali, and mostly spend in IDR, I've noticed the exchange between MYR-IDR is not historically that spread as the IDR has also suffered a decline. The best I could have got for 1MYR, last October, was IDR3,766 and today it is still about 3,600....about 4.4% less than best xchange.
Also, MYR MM2H deposit only gets about 3.5% but my IDR deposits get 8.5%+.

As I doubt I'll live in Malaysia, should giving up MM2H be correct or is there something I might be missing?

I'm aware of political instability in Indonesia but isn't Malaysia in the same boat?

Re: MM2H Fixed Deposit
 

Davita,
Whether to give up the MM2H or not depends of course on your personal circumstances.
But, if you don't need the money, some arguments for keeping it may be:
It is good to have 'in case' and has no particular obligations.
Interest earned is tax-free. So is income from overseas even if brought into the country.
More stable than Indonesia?

Also consider issues like how to regulate inheritance and procedures for next of kin, etc.

Re: MM2H Fixed Deposit
 

I mentioned this to the Font of All Knowledge (mr bakedbean) and he said Ah but they think in different ways. With CIMB Malaysia, the minimum amount on Fixed Deposit is quite low. With CIMB Singapore, the interest rates are structured for quite high minimums. Of course we all know that Singapore residents have a lot of dosh ;)

Interesting fact though, Gunnar. Thanks for that.

Anyway, totally off topic, so apologies to the OP.

Re: MM2H Fixed Deposit
 

I think there is a lot of confusing information in this thread!

My understanding (but it would be good to have confirmation from someone in authority) is that Malaysia does not have any clearing banks (though they have announced they will form one with China for the renmimbi). I think this is the reason foreign currency deposits do not pay very good rates as they are held with a third party. It is also why you can't have a ringitt account outside Malaysia unless again it is held with a third party.

As regards the opening and closing of bank accounts in Malaysia I think this comes down to the banks "know your customer" policies. Obviously you don't need an MM2H visa to open an account as the FD has to be made first but the bank may ask for evidence that you have applied for MM2H. Alternatively deeds of a property you own in Malaysia, lease for a property you rent or introduction by someone known to the bank are other options. In the case of HSBC just being a Premier customer is sufficient. Similarly, when leaving Malaysia, the bank may ask you to close your account if they have any concerns or you may be allowed to keep it open indefinitely.

Re: MM2H Fixed Deposit
 

I was an HSBC Premier client prior to visiting Malaysia but asked to show 'conditional approval for MM2H' prior to opening my HSBC account in KL, although I didn't try opening without the conditional visa
For a while, I used the Malaysian MM2H FD as the deposit required to maintain HSBC Global Premier status.

Thanks Gunner45...just a thought...if I give up MM2H and still leave the FD in the bank in KL, will the interest then be taxed. Do they with-hold tax on interest in Malaysia?

Re: MM2H Fixed Deposit
 

I guess even that depends on the circumstances then. I opened an account with HSBC some months before applying for MM2H but on the other hand I did have a lease for an apartment.

Re: MM2H Fixed Deposit
 

I guess how you are treated by HSBC is about as variable as any of the Malaysian banks. Even when I offered the carrot of transfering my investments to the HSBC branch in town the international banking team said 'no malaysian account, not until you have a conditional letter'.

It will presumably be different for expats on a different ticket such as employment visa.

Re: MM2H Fixed Deposit
 

As a Premier customer, I was able to open an account with HSBC Penang last year as a tourist before applying for MM2H. I did not need to submit any document showing my lien to Malaysia whatsoever, using my foreign address instead.

Re: MM2H Fixed Deposit
 

Davita,
Interest earned on FD's (and maybe other) is tax free in Malaysia

Re: MM2H Fixed Deposit
 

That is true for MM2H'ers but not for non-resident account holders - for them there is a 15% withholding tax.

See page 3 of the following:-

http://www.expat.hsbc.com/1/PA_ES_Co...r/malaysia.pdf

Re: MM2H Fixed Deposit
 

Thanks IVV...I kinda suspected some tax would be withheld from non-residents as the same happens in Indonesia where 20% is withheld...yet I still net 6.8% on IDR.
This compares to less than 3% (after tax) on the MYR.
Thanks to everyone for helping me to come to a decision.
I wont be doing anything till a visit sometime early February...planning to arrive Singapore and taking the shuttle bus to JB. A couple of nights in the Puteri Harbour Shangri-La (looksee Nusajaya/Iskander) then a train ride to KL, where we'll spend a couple of days.
If decided, we then have the option to go to Putrajaya and relinquish MM2H.

Re: MM2H Fixed Deposit
 

Sorry for the possible mistake, just now I checked the MY Tax law and there it states:
Laman Rasmi Lembaga Hasil Dalam Negeri Malaysia
Still a bit ambiguous though as it also mentions no tax when receiving interest from banks....

Re: MM2H Fixed Deposit
 

I think you may have missed it Gunnar45. The second level of your link to non-resident tax does indicate interest is taxed at 15%.


Non-resident Tax rate:

Types Of Income
Rate (%)
Business, trade or profession
Employment
Dividends
Rents
26

Public Entertainer
Interest
15

Re: MM2H Fixed Deposit
 

Yes, but if you look further down on the page:

You will not be taxable if:
Employed in Malaysia for less than 60 days
Employed on board a Malaysian ship
Age 55 years old and receiving pension from Malaysian employment
Receiving interest from banks
Receiving tax exempt dividends
If taxable, you are required to fill in M Form .

Furthermore, I just received the below reply re account closing:
One who wishes to cancel their MM2H may not necessary to close their bank accounts. Meaning to say that it is up to person to close or to leave the accounts open.
In my opinion, I would suggest the person to leave the accounts open. Otherwise, once you have them close, to open again is difficult without any visa.

To further drift from the original topic, is it possible for non-resident to open FD in Indonesia? Is the IDR a high risk currency?
Do they allow forex FD's there? (AUD, NZD)