Another nail in the MM2H coffin
Aug 9th 2022 | 2:27 pm
#46
Just Joined
Joined: Jul 2022
Posts: 20
Re: Another nail in the MM2H coffin
Hmm...so if the source of the remitted income is pension and neither the source country nor Malaysia taxes pensions...one will be taxed on the pension? Or if the source of the income is interest from a savings account...and Malaysia does not tax savings accounts. Is it still taxed?
How do they parse between the use of remiitances from a savings account that existed long previous to residence in Malaysia (savings is not INCOME) and remittances from Income that is then placed in a bank account? Could one not simply place any income from this calender year in a different account. And draw remittances from the saving accounts accrued from previous years? One would not be, or had previously been, subject to tax on that "previous" account. The more recently accruing account would be taxed in the originating country or exempt under the home countries tax laws. I presume that one reports it to Inland Revenue, though. Some of the income might be taxed at some low rate say~ 1%. My tax rates on some aspects of my income varies depending upon how much general income I make. My Social Security might vary between 0% and 15% (half of the SS is taxed at the tax bracket one falls within). So if one is getting zero will Malaysia tax the remittances but if it is 5% or 15% they will not?
Frankly reading the law made me dizzy. It was if it was a word salad drawn up by Sir Humphrey of "Yes, Minister!"
How do they parse between the use of remiitances from a savings account that existed long previous to residence in Malaysia (savings is not INCOME) and remittances from Income that is then placed in a bank account? Could one not simply place any income from this calender year in a different account. And draw remittances from the saving accounts accrued from previous years? One would not be, or had previously been, subject to tax on that "previous" account. The more recently accruing account would be taxed in the originating country or exempt under the home countries tax laws. I presume that one reports it to Inland Revenue, though. Some of the income might be taxed at some low rate say~ 1%. My tax rates on some aspects of my income varies depending upon how much general income I make. My Social Security might vary between 0% and 15% (half of the SS is taxed at the tax bracket one falls within). So if one is getting zero will Malaysia tax the remittances but if it is 5% or 15% they will not?
Frankly reading the law made me dizzy. It was if it was a word salad drawn up by Sir Humphrey of "Yes, Minister!"
Only time will tell if the new rules are modified, clarified or even applied. Certainly any capital we bring in should not be taxed nor any income from previous years. It would also be unfair to tax our pensions. My expectation is that, as non-Malaysians, we will not be the focus of the taxman's attentions since (i) our capital did not originate in Malaysia, (ii) our income is relatively modest in the overall scheme of things and (iii) we can just leave if the tax demand is unreasonable.
