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TOPIC 7 REAL PROPERTY GAINS TAX (RPGT)

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WHAT DO YOU NEED TO KNOW ON REAL PROPERTY GAINS TAX Recall: The sales of the durian tree is NOT taxable income because it is capital in nature but the sales of the durian is taxable because it is revenue in nature. Based on the above principle, if a taxpayer sell his house, will he be subject to income tax? NO!!!! A. Introduction 1. When does Real Property Gain Tax Act 1976 came into effect? 7 November 1975 2. Which periods after the introduction of RPGT Act are exempted from RPGT? 1 April 2007 to 31 December 2009 3. When does a chargeable person subject to RPGT? Disposal of a chargeable asset which resulted in a chargeable gain in the YA regardless of resident or non-resident in Malaysia. B. Taxation of Chargeable Gains 1. When is sales/disposal of a real property subject to RPGT? Sales/disposal of a real property is only chargeable IF: a. It is a chargeable asset e.g property in Malaysia b. There is disposal/deemed disposal e.g transfer of ownership c. There is a chargeable gain and d. Involves a chargeable person e.g individual, partnership, company, church, temple etc 2. Does the chargeable gain for real property added to the individual chargeable income or tax separately under different tax regime? RPGT and income tax are mutually exclusive (i.e if the disposal of real property is a revenue gain, RPGT would not be imposed). Note: Basis year is the year of assessment for RPGT C. Returns 1. When should the chargeable person make the tax return on RPGT? 60. days from date o ...
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