UNIT TRUST INTRODUCTION•Unit trust is created by a trust deed entered into between amanagement company and a custodian trustee to be held onbehalf of the investors, who are known as unit holders•Management company is the company that establish the fund•Trustee acts as a custodian of these asset and is responsible toprotect the interest of the unit holder•Unit trust is a trust where the beneficiaries’ interest in the trustassets are represented by units•Unit trust mainly invest in stocks or shares in KL stock exchangeand Government bondsSlide 5 of 26
Common UT Income1.Gains from realisation of investments: Exempted2.Interest: mostly exempted3.Dividends : 1 tier - exempted4.Rental-MSI taxable3
Exempt Income of UTFSIInterest income from:Securities or bond issued by the G’ovtDebenture other than convertible loan stock, approvd by SCBon Simpanan Malaysia•Licensed financial institution or Islamic bank 1983.•Any savings certificates issued by the G’ovt [para 19 Sch 6]•Islamic securities (including sukuks) originating fromM’sia, other than convertible loan stock,and approved by the SC orLabuan Financial Services Authority[subp 33B Sch 6],•Dividends distributed out oftheseexempt UT income is exempted inthe hands of unit holders.4
3. CA for Rental Incomes 63A1.Rental Income is taxed when due or paid in advanced2.CA is permitted. Eg. CA for lifts, escalators, air-conditioning,fire fighting equipments4.Rate of CA is a flat 10% of QPE.5.Excess CA for a YA would be disregarded.5
QUALIFYING CAPITALEXPENDITURE•Refers to plant and machinery used for the purpose of renting outproperties.•Expenditure incurred in the alteration of an existing building for thepurpose of installing that machinery or plant and other incidentalexpenditure provided that such expenditure does not exceed 75% ofthe aggregate expenditure•Expenditure incurred in preparing or levelling land in order to prepare asite for the installation of that machinery provided that suchexpenditure does not exceed 10% of the aggregate expenditure6RM•Lifts2,000•Escalators3,000•Air-conditioning2,000•Fire fighting equipments3,000CA = 10% x 10,000 = 1,000.