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Determine the types of payment made to non-resident person which is subject to withholding tax and explain the responsibility of the payer according to the Income Tax Act 1967. (as amended) B.

Determine the types of payment made to non-resident person which is subject to withholding tax and explain the responsibility of the payer according to the Income Tax Act 1967. (as amended) B.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Determine the types of payment made to non-resident person which is subject to withholding tax and explain the responsibility of the payer according to the Income Tax Act 1967. (as amended) Chanting Sdn Bhd, a tax resident company, entered into a royalty agreement with K Pop Ltd, a non-resident from Korea, for the use of a software application during the year of assessment 2016. Chanting Sdn Bhd received an invoice from K Pop Ltd. for RM10,000 on 12 February 2016 and credited the funds to K Pop Ltd on 18 February 2016. С. Required: State the withholding tax obligations required of Chanting Sdn Bhd under the Income Tax Act on paying/crediting the non-resident, K Pop Ltd. Your answer should include the withholding tax rate which will apply and the due date to remit the withholding tax to the Inland Revenue Board. Kerlipan Sdn. Bhd. closes its accounts on 30 April every year. For the year of assessment 2015, the company recorded chargeable income of RM950,000. On 1st April 2014, the company had submitted its estimation of tax for the year of assessment 2015 amounting to RM250,000. The company is subjected to D. corporate tax of 25%. Required: i. Calculate the penalty charged to Kerlipan due to underestimate of income tax payable. ii. Advise Kerlipan Sdn. Bhd. on how the company can avoid paying penalty for underestimate of income tax payable. Your answer should include the deadline on the revision of estimated income. B. C.
Transcribed Image Text:Determine the types of payment made to non-resident person which is subject to withholding tax and explain the responsibility of the payer according to the Income Tax Act 1967. (as amended) Chanting Sdn Bhd, a tax resident company, entered into a royalty agreement with K Pop Ltd, a non-resident from Korea, for the use of a software application during the year of assessment 2016. Chanting Sdn Bhd received an invoice from K Pop Ltd. for RM10,000 on 12 February 2016 and credited the funds to K Pop Ltd on 18 February 2016. С. Required: State the withholding tax obligations required of Chanting Sdn Bhd under the Income Tax Act on paying/crediting the non-resident, K Pop Ltd. Your answer should include the withholding tax rate which will apply and the due date to remit the withholding tax to the Inland Revenue Board. Kerlipan Sdn. Bhd. closes its accounts on 30 April every year. For the year of assessment 2015, the company recorded chargeable income of RM950,000. On 1st April 2014, the company had submitted its estimation of tax for the year of assessment 2015 amounting to RM250,000. The company is subjected to D. corporate tax of 25%. Required: i. Calculate the penalty charged to Kerlipan due to underestimate of income tax payable. ii. Advise Kerlipan Sdn. Bhd. on how the company can avoid paying penalty for underestimate of income tax payable. Your answer should include the deadline on the revision of estimated income. B. C.
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