EY Tax Alert. Malaysian developments. Vol Issue no October Public Ruling No. 7/2018 Accelerated Capital Allowance

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1 EY Tax Alert Vol Issue no October 2018 Malaysian developments Public Ruling No. 7/2018 Accelerated Capital Allowance Public Ruling No. 8/2018 Tax Incentives for BioNexus Status Companies Public Ruling No. 9/2018 Taxation of Unit Holders of Real Estate Investment Trusts / Property Trust Funds Stamp duty exemption for home financing facility granted under a state housing loan fund Stamp duty exemption for instruments relating to the restructuring or rescheduling of loans or financing Remission of tax and stamp duty Overseas developments Australian Treasury Discussion Paper on the digital economy and Australia s corporate tax system: A detailed review Thailand introduces International Business Center regime to replace existing incentive regimes Malaysian developments Public Ruling No. 7/2018 Accelerated Capital Allowance The Inland Revenue Board (IRB) has issued Public Ruling (PR) No. 7/2018: Accelerated Capital Allowance, dated 8 October The PR discusses the claim of Accelerated Capital Allowances (ACA) and the claim of CAs at normal (non-accelerated) rates on qualifying plant and machinery. The earlier 34-page PR No. 4/2013 (see Tax Alert No. 10/2013) that was issued on 15 April 2013, has been updated and re-arranged in this PR. The new PR comprises the following sections and sets out 12 examples: 1.0 Objective 2.0 Relevant provisions of the law 3.0 Interpretation 4.0 Application of the law 5.0 Introduction 6.0 Qualifying expenditure 7.0 Income tax rules 8.0 Steps to claim accelerated capital allowance 9.0 Qualifying period 10.0 Disposal of assets within two years 11.0 Non-application 12.0 Claim procedure 1

2 13.0 Summary of income tax rules and rates of allowances 14.0 Updates and amendments 15.0 Disclaimer The new PR is broadly similar to the earlier PR and provides clarification in relation to the definition of qualifying expenditure, the conditions that must be fulfilled by a person to qualify for ACA, the qualifying period to claim ACA, the tax treatment where assets are disposed of within two years, and the non-application provisos. It has, however, been updated to reflect the ACA P.U. Orders which are still in force. The earlier PR included ACA P.U. Orders which had already lapsed. Some of the key changes are as follows: Paragraph The PR has been updated to reflect the correct ACA rate pursuant to the Income Tax (Accelerated Capital Allowances) (Recycling of Wastes) Rules [P.U.(A) 505/2000]. The new PR explains and provides additional examples on the ACA P.U. Orders. The new PR clarifies that a person is given the option to either claim ACA on plant and machinery under the P.U. Order or claim capital allowances at the normal rates as provided under paragraphs 10 and 15, Schedule 3 of the Income Tax Act 1967 (ITA). The claims for ACA and reinvestment allowance (RA) are mutually exclusive. However, if a person is entitled to claim RA but chooses not to do so, the person is eligible to claim ACA. The new PR further stipulates that where a person has inadvertently claimed any incentives listed in the non-application rule and ACA at the same time, then the tax incentives provided will be maintained, the ACA claimed will be withdrawn, and capital allowances at the normal rates will apply. The new PR outlines steps that can be followed to facilitate the understanding of claiming ACA. Public Ruling No. 8/2018 Tax Incentives for BioNexus Status Companies The IRB has issued PR No. 8/2018: Tax Incentives for BioNexus Status Companies, dated 9 October 2018, to explain the tax treatment in respect of tax incentives for a BioNexus Status Company (BSC) in Malaysia. This new 20-page PR comprises the following 14 paragraphs and sets out 12 examples: 1.0 Objective 2.0 Relevant provisions of the law 3.0 Interpretation 4.0 Introduction 5.0 BioNexus status companies 6.0 Tax incentives 7.0 Capital allowances / industrial building allowances 8.0 Treatment on losses incurred by BioNexus status companies 9.0 Deductions for promotion of export 10.0 Deductions for research and development expenditure 11.0 Non-application 12.0 Withdrawal of tax incentives 13.0 Compliance of the Income Tax Act 1967 (ITA) 14.0 Disclaimer Broadly, the PR explains the definition of a BSC, the application process for BioNexus status, the tax incentives available for a BSC, and treatment of losses incurred by a BSC. The PR clarifies and provides examples of the tax incentives and deductions available to a BSC, as outlined below: (a) Tax exemption on statutory income pursuant to the Income Tax (Exemption)(No.17) Order 2007 [P.U.(A) 371/2007] (b) Tax exemption on statutory income equivalent to an allowance of 100% of the qualifying capital expenditure (QCE) pursuant to Income Tax 2

3 (Exemption)(No. 18) Order 2007 [P.U.(A) 372/2007] (c) Further tax exemption on statutory income in addition to the tax exemptions outlined in (a) and (b) above, pursuant to the Income Tax (Exemption)(No. 2) Order 2009 (d) Industrial building allowance (IBA) pursuant to Income Tax (Industrial Building Allowance) (BioNexus Status Company) Rules 2007 (e) Deductions for promotion of export (f) Deductions for research and development expenditure The PR illustrates the determination of the tax exempt period for both new business and expansion project scenarios, pursuant to the tax exemptions outlined in (a) and (b) above. The PR stipulates that any losses incurred before the exempt year of assessment (YA) commences (i.e. after the commencement of a new business or expansion project) and within the period of exemption, may be carried forward to the YA after the exempt period, and are to be deducted from the statutory income of the new business or expansion project until they are fully absorbed. Public Ruling No. 9/2018 Taxation of Unit Holders of Real Estate Investment Trusts / Property Trust Funds 4.0 Tax at unit holders level 5.0 Filing of income tax return form 6.0 Updates and amendments 7.0 Disclaimer The content of the new PR is broadly similar to the earlier PR. It has however been updated to reflect the legislative change in Budget 2017, where Section 61A(2) of the ITA was amended such that only a unit trust approved by the SC and listed on Bursa Malaysia is exempt from tax, where the 90% distribution threshold is met (see Tax Alert No. 23/2016). Prior to the amendment, a unit trust approved by the Securities Commission (SC) as a REIT or PTF would have been exempt from tax if 90% or more of total income was distributed to the unit holders, even if the REIT / PTF was unlisted. The new PR also stipulates that where a unit holder is tax-exempt under Section 127(3)(b), 127(3A) or Schedule 6 of the ITA, and the distribution of income from a REIT / PTF has been subjected to withholding tax under section 109D of the ITA, that unit holder would be entitled to a refund under Section 111 of the ITA. Where a REIT/PTF is not exempted from tax under Section 61(1A) of the ITA, its unit holders would be entitled to claim a tax credit under subsection 110(9A) of the ITA when they declare the taxable distribution from the REIT / PTF in their income tax returns. The IRB has issued PR No. 9/2018: Taxation of Unit Holders of Real Estate Investment Trusts / Property Trust Funds, dated 12 October The PR explains the tax treatment of distribution of income from real estate investment trusts (REITs) / property trust funds (PTFs) in Malaysia to unit holders. This new seven-page PR replaces PR No. 7/2012, which was published on 29 October 2012 (see Tax Alert No. 24/2012). The new PR comprises the following sections and sets out 12 examples: 1.0 Objective 2.0 Relevant provisions of the law 3.0 Interpretation Stamp duty exemption for home financing facility granted under a state housing loan fund The Stamp Duty (Exemption) (No. 2) Order 2018 [P.U. (A) 258], gazetted on 12 October 2018, provides a stamp duty exemption on all instruments executed in relation to any home financing facility granted under a state housing loan fund, which is a fund specified in paragraph 10(1)(b) of the Financial Procedure Act Financing is defined to mean conventional loan, or financing according to syariah, as the case may be. 3

4 The Order will come into operation on 1 January Stamp duty exemption for instruments relating to the restructuring or rescheduling of loans or financing The Stamp Duty (Exemption) (No. 3) Order 2018 [P.U. (A) 259] was gazetted on 15 October The Exemption Order provides a stamp duty exemption on all instruments relating to the restructuring or rescheduling of loans or financing executed between a participant of the debt management programme which has been approved by the Credit Counselling and Debt Management Agency (CCDMA), and a credit provider. The CCDMA is a body corporate established under Section 48 of the Central Bank of Malaysia Act Credit provider is defined to mean: (a) A licensed bank under the Financial Services Act 2013 (FSA); (b) A licensed Islamic bank under the Islamic FSA; (c) A development financial institution prescribed under the Development Financial Institutions Act 2002; (d) A licensed life insurer under the FSA; (e) A licensed takaful operator under the Islamic FSA; (f) An approved issuer of a designated payment instrument under the FSA; (g) A co-operative society registered under the Cooperative Societies Act 1993; and (h) Perbadanan Tabung Pendidikan Tinggi Nasional established under the Perbadanan Tabung Pendidikan Tinggi Nasional Act The Order is effective from 1 January 2018 to 31 December 2020 and applies to instruments executed within the same period. Remission of tax and stamp duty The Loans Guarantee (Bodies Corporate) (Remission of Tax and Stamp Duty) (No. 5) Order 2018 [P.U.(A) 266] was gazetted on 18 October The Order provides that any tax payable under the ITA and any stamp duty payable under the Stamp Act 1949 in relation to the following, shall be remitted in full: (a) Islamic Medium Term Notes and Islamic Commercial Papers issued or to be issued by DanaInfra Nasional Berhad pursuant to the Islamic Medium Term Notes and Islamic Commercial Papers Programme in nominal values of up to RM15 billion, provided that the combined aggregate of the outstanding nominal value of the Islamic Medium Term Notes and Islamic Commercial Papers, and the outstanding principal amount under the Syndicated Revolving Credit-i Facility (SFF-i Facility, see (b) below), shall not exceed RM15 billion; (b) SFF-i Facility obtained or to be obtained by Suria Strategic Energy Resources Sdn Bhd in the aggregate principal amount not exceeding RM1.6 billion, subject to the combined aggregate referred to in (a) above; and (c) Guarantee provided or to be provided by the Government of Malaysia in relation to the Islamic Medium Term Notes and the SFF-i Facility. The application for an exemption is to be accompanied by a letter of offer from the Credit Counselling and Debt Management Agency to the said participant for the restructuring or rescheduling of the loan or financing under the debt management programme which has been approved by the CCDMA. 4

5 Overseas developments Australian Treasury Discussion Paper on the digital economy and Australia s corporate tax system: A detailed review An Australian Treasury Discussion Paper (TDP) released on 2 October 2018 explores a corporate tax system for the digital economy in Australia as announced in the Federal Budget. The TDP does not provide any recommendations nor expresses a clear preference for any particular measure for taxing the digital economy, either on a long-term structural basis or an interim basis. However, it implies that an interim digital services tax (DST) may be warranted given the likelihood that no long-term global solution is in sight. Taken together with recent similar comments out of the United Kingdom (UK) Government on this issue, this is potentially a significant business issue to be addressed by taxpayers. The TDP includes a detailed discussion on long-term solutions being explored and interim solutions being proposed. These include some proposals from the European Union (EU) and other countries of a turnover tax on digital activities. Long-term solutions such as defining a digital presence and the appropriate attribution of profit will take time. It suggests, significantly, that an international adoption of a DST would not be a short-term measure and would be kept in place until a structural global response is put into place, if this is ever achieved. The TDP is seeking feedback on a series of openended questions by 30 November Thirteen discussion questions cover input on issues such as: Cross-border taxation of user-created value and value associated with intangibles Changes to existing profit attribution rules and nexus rules for cross-border digital activities Options for broader reform and design considerations for interim options Detailed discussion Overview Some form of DST is under active consideration in various jurisdictions and the TDP notes a future changed environment with Hungary, India and the Slovak Republic cited as front runners. Australia has a strong record as a leader in tax policy initiatives internationally, including its adoption of Base Erosion and Profit Shifting (BEPS) actions and two measures largely unique to Australia and the UK, namely the multinational antiavoidance law and diverted profits tax. Political momentum for a DST will accelerate if EU proposals to introduce a gross turnover tax succeed; or failing this, Italy and Spain have announced their intention to introduce interim measures in 2019 aligned with the European Commission proposal. The TDP, including its open-ended questions, will invite submissions from tax advocacy organizations and public interest groups, especially on the broader super profit taxation and formulary apportionment concepts noted in the paper. The TDP is seeking input on various aspects of implementation of a future tax. Recognizing the debate about the efficacy or wisdom of such a tax, it acknowledges issues around competitiveness, consumer and compliance costs, as well as trade and tax treaty obligations. The TDP may also be relevant in the upcoming Australian Federal Election. This makes engagement in the policy debate more important for potentially affected businesses. 5

6 TDP chapter by chapter Chapter 1 seeks to explain and define the digital economy and the impact of digitalization on the economy. Chapter 2 provides an overview of the Australian corporate tax system followed by how this translates to the taxation of highly digital businesses in Australia. Chapter 3 recaps how the Australian tax system has reacted to integrity issues, revisiting the G20 / Organisation for Economic Co-operation and Development (OECD) BEPS project and Australia s actions beyond the BEPS project. Chapter 4 traverses international trends and increasing international pressure to act, and contains eight out of a total of 13 consultation questions (CQ). Chapter 5 looks at interim options with two CQs; the remaining three CQs are on more detailed design considerations for an interim DST explored in an Appendix to the TDP. International trends and options for reform Chapter 4 contains the bulk of the detailed CQs and raises the following high level issues and questions. Should taxing rights change to reflect user-created value? CQ #1: Is user participation appropriately recognised by the current international corporate tax system? If not, how should value created by users be quantified and how should it be taxed? Should taxing rights change to reflect value associated with intangibles? CQ #2: Is the value of intangible assets including marketing intangibles appropriately recognised by the current international corporate tax system? If not, how should value associated with intangibles be quantified and how should it be taxed? Potential changes to existing profit attribution rules CQ #3: Are the current profit attribution rules fit for purpose? If not, how should profits be attributed? CQ #4: What are your views on allocating taxing rights over residual profits associated with: (i) user contribution to user countries, or (ii) marketing intangibles to market countries? Potential changes to existing nexus rules CQ #5: Should existing nexus rules for determining which countries have the right to tax foreign resident companies be changed? If so, how? Can changes only apply to highly digitalised businesses? CQ #6: From a tax perspective, do you consider that the digitalised economy is distinguishable from traditional economy? If yes, are there economic features of the digitalized economy that present special challenges in the context of taxation? How are these features relevant for assessing the costs and benefits of various models of taxation? CQ #7: Can and should any changes to the international nexus and profit attribution rules be ring-fenced to apply only to highly digitalised businesses? If so, how? Australia s options for broader reform The current discussion of the tax challenges arising from the digitalization of the economy is part of a broader concern about whether existing corporate tax frameworks remain fit for purpose. Australia relies more heavily on corporate income tax than comparable OECD countries. Around 20% to 25% of Commonwealth tax revenue (excluding Goods and Services Tax (GST)) comes from 6

7 company tax. This may mean Australia is particularly exposed as a result of globalization and digitalization. At the same time, revenue collection from consumption taxes like GST/Value Added Tax is significantly lower in Australia than OECD countries given the lower GST rate at 10%. So the TDP goes on to ask for input on long-term policy. CQ #8: Are there changes other than to nexus and profit attribution rules that should be made to the existing international corporate tax framework and/or Australia s tax mix to address the challenges presented by globalisation and digitalisation? Tax policy design considerations for an interim measure The OECD acknowledges international consensus for a longer-term solution will be challenging and accepts that countries may go ahead with interim solutions. As the TDP outlines, the OECD Interim Report in March 2018 on Tax Challenges Arising from Digitalisation suggests any interim measure should be: Targeted at businesses that benefit most from user-created value Designed to minimize cost and complexity Narrowly targeted to avoid over-taxation Designed to minimize impact on business creation, startups and small business Consistent with countries international obligations, including World Trade Organisation (WTO) obligations, free trade agreements (FTAs) and tax treaties Applied only until such time as a consensusbased solution is developed Implications for businesses and consumers May increase the cost to Australian businesses and consumers of digital products and services that are covered by the interim measure May have an adverse impact on investment, innovation and welfare, for example by distorting the choices of Australian consumers and businesses, or by changing the way in which digital products and services are provided May have relatively high compliance and administrative costs Australia s tax policy design There are two high level questions on Australia s tax policy design considerations for an interim measure: CQ #9: What does the experience of other countries that have introduced interim measures or that are contemplating them, mean for Australia? CQ #10: Should Australia pursue interim options ahead of an OECD-led, consensus-based solution to address the impacts of the digitalisation of the economy on the international tax system? The appendix to the TDP explores the scope of a potential interim DST in more detail, and raises the following questions: What digital services could be more appropriately taxed? CQ #11: What indicators could be used to identify businesses that benefit most from user-created value? Would an interim measure applied to digital advertising and/or intermediation services accurately target that value? How broadly or narrowly should digital advertising and intermediation services be defined? The OECD has concerns about imperfect policy measures, and that any interim measure: Would need to apply to both domestic and foreign businesses (to comply with WTO and other international obligations), and so could result in over-taxation overlaid onto Australian corporate tax What nexus would highly digitalised businesses need to have with Australia? CQ #12: The choice of nexus for an interim measure (or a longer-term virtual PE proposal) involves significant trade-offs between ease of administration and the risk of avoidance. Which 7

8 nexus option strikes the best balance between these considerations? Would an interim measure only apply to businesses above certain thresholds? CQ #13: What are your views on thresholds for an interim measure, taking into account the need to meet Australia s international trade obligations? EY initial points of view EY will make a submission responding to the scoping questions raised by the TDP and will assist businesses to make representations. The responses will be framed by some high level points of view on tax policy design issues as outlined below. Australia has already been very active in taxing digital as well as other transactions: The introduction of the Multinational Anti- Avoidance Law effective 1 January 2016 goes beyond the scope of the BEPS project, and the Tax Office s comprehensive compliance program has seen additional AU$7 billion in taxable sales revenue. GST law changes covering business-to-consumer digital supplies by non-residents (both for supplies of goods and intangibles), settlements arising from the Australian Taxation Office (ATO) tech sector audit program which has been running for at least five years, and the introduction of the Diverted Profits Tax (effective 1 July 2017), have already extended Australia s taxing authority over digital sales. Australia s strong tax policy and administration initiatives have brought multinational companies into audit settlements or advance pricing agreements with the ATO. In some cases, digital sales that would be targeted by a digital services tax are already being included in the Australian revenue base and subject to tax here, creating double or over-taxation with limited prospect of getting credits under tax treaties. This is why G20 leaders have as a high priority, a unified approach to digital taxation as has been the case with the BEPS project, as opposed to uncoordinated unilateral measures. The heavy reliance on corporate and personal income taxes should also be considered, as the issue of BEPS can in part be mitigated through reducing income tax rates and increasing consumption taxes, like the GST. Digital taxes introduced unilaterally by any country also affect investment confidence and international reputation. Taxes which target non-residents and operate as a country market access fee also risk breaching WTO obligations as flagged by the TDP. If market access is used to justify digital taxes in the countries where digital products are consumed, then source or origin countries might consider imposing new and complementary excise taxes on other products, even bulk commodities or resources, which naturally would hurt Australia. If Australia is to take a lead role in this space as it did with BEPS, it should seek to help develop a broad consensus-based long-term solution rather than a short-term interim measure which may have issues of unilateral taxation associated with it. The TDP will be seen internationally and will hopefully lay the foundation for a genuinely constructive consultation process to fully canvass the options and weigh the risks as the G20 and Australia develop their approaches to global digital taxation. But Australia must avoid short term, unilateral or politically motivated reactions to global digital taxation. If it does not, it risks creating double taxation, WTO concerns and retaliatory risks, especially from the United States (US) which granted Australian steel exporters an exemption from US steel tariffs recently. All new taxes must be fully considered, and their broader impact tested, before being implemented. 8

9 Thailand introduces International Business Center regime to replace existing incentive regimes No new applications for the existing regimes will be accepted and approved on or after 10 October Comparative chart On 9 October 2018, the Thai Cabinet approved the repeal of the existing tax-incentivized regional and international headquarters regimes, and replaced them with a single International Business Center (IBC) regime. Under the IBC, new conditions must be met to be eligible for the incentives and certain existing incentives would be reduced. This measure is in response to the Harmful Tax Practices 2017 Progress Report on Preferential Regimes (Inclusive Framework on Base Erosion and Profit Shifting (BEPS): Action 5) in which Thailand s regional/international headquarters, trading and treasury hub regimes were identified as harmful tax practices. Detailed discussion Repealed regimes The following regimes are repealed: Regional Operating Headquarters (ROH) I and ROH II under Royal Decrees 405 & 508 International Headquarters (IHQ) and Treasury Center (TC) under Royal Decree 586 International Trading Center (ITC) under Royal Decree 587 Entities under the existing ROH II, IHQ, TC and/or ITC regimes Entities which have already been granted incentives under ROH II, IHQ, TC and/or ITC regimes remain eligible for these tax incentives under the existing conditions until their current status expires (for an IHQ/ITC, this may be for up to 15 years). Entities with ROH I status, however, can only enjoy the incentives until the end of the accounting year The existing ROH or IHQ/TC entities may choose to convert their status into an IBC. Main tax incentives and conditions Corporate income tax Qualifying service, TC and royalty incomes Dividend income from local and overseas Old IHQ / ITC / TC 0% (overseas) / 10% (local) Exempt (only dividends from overseas) New IBC 8%, 5% or 3% Exempt Capital gains Exempt Not mentioned Trading income Exempt Not mentioned Withholding tax Dividend Exempt Exempt distribution to overseas Interest payment to overseas Exempt Exempt Specific business tax Qualifying TC income Exempt Exempt Personal income tax Qualifying expatriates 15% 15% Minimum paidup capital Minimum annual local spending Minimum number of employees THB10 mil (US$0.31 mil) THB15 mil (US$0.46 mil) None THB10 mil THB60 mil (US$1.85 mil) 10 persons (5 persons for TC) Further details of tax incentives and conditions under the IBC regime are expected to be released shortly and remain subject to further legislative processes. 9

10 Contact details Principal Tax contacts Yeo Eng Ping Amarjeet Singh Global Compliance and Reporting Simon Yeoh Julian Wong Datuk Goh Chee San (based in Sabah) Janice Wong Julie Thong Lee Li Ming (based in Johor) Liew Ai Leng Koh Leh Kien Mark Liow (based in Penang) People Advisory Services Tan Lay Keng Irene Ang Christopher Lim Business Tax Services Amarjeet Singh Farah Rosley Robert Yoon Wong Chow Yang Transaction Tax Services Yeo Eng Ping Sharon Yong International Tax Services Anil Kumar Puri Asaithamby Perumal Transfer Pricing Sockalingam Murugesan Vinay Nichani Hisham Halim Indirect Tax Yeoh Cheng Guan Aaron Bromley Financial Services Bernard Yap

11 Important dates 31 October th month revision of tax estimates for companies with April year-end 31 October th month revision of tax estimates for companies with January year-end 31 October 2018 Statutory deadline for filing of 2018 tax returns for companies with March year-end 15 November 2018 Due date for monthly instalments 30 November th month revision of tax estimates for companies with May year-end 30 November th month revision of tax estimates for companies with February year-end 30 November 2018 Statutory deadline for filing of 2018 tax returns for companies with April year-end EY Assurance Tax Transactions Advisory About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com Ernst & Young Tax Consultants Sdn. Bhd. All Rights Reserved. APAC no ED None. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax or other professional advice. Please refer to your advisors for specific advice. Publisher: Ernst & Young Tax Consultants Sdn. Bhd. Level 23A Menara Milenium Jalan Damanlela, Pusat Bandar Damansara Kuala Lumpur Tel: Fax:

12 EY 2019 Budget and Tax Conference How will the 2019 Malaysian Budget affect your company and business? Are there new incentives that your organization can take advantage of? Are there new taxes or regulations that you need to be mindful of? What are the latest developments in the tax arena that will impact how you manage tax risks? EY's senior tax professionals are ready to help answer these questions for you. They can explain and guide you through the salient issues of the 2019 Malaysian Budget and share practical insights on the latest tax developments. Participants at our Budget seminars will be provided with a copy of the 2019 Budget commentary, as well as opportunities for questions and answers. Mark these dates down for an insightful session on the 2019 Malaysian Budget and more! Peninsular Malaysia Date Venue Time Contact Kuala Lumpur 8 November 2018 Mandarin Oriental, Kuala Lumpur 9:00 a.m. 5:00 p.m. Jan Lim: Kiran Kaur: Ipoh 14 November 2018 Weil Hotel 9:00 a.m. 5:00 p.m. Joanne Ow / Talvinderjit Singh: Penang 22 November 2018 Eastern & Oriental Hotel 9:00 a.m. 5:00 p.m. Teoh Zhi Xiang / Kang Mei Siang:

13 Date Venue Time Contact Johor Bahru 22 November 2018 Mutiara Hotel 9:00 a.m. 5:00 p.m. Roslina Md Salleh / Lili Nazirah Abdul Hamid: Melaka 23 November 2018 Hatten Hotel 9:00 a.m. 5:00 p.m. Chan Lay Khim / Michelle Tan Pau Choo: Kuantan 15 November 2018 The Zenith Hotel 9:00 a.m. 5:00 p.m. Juliana Hanim / Eddie Eries: Sarawak Date Venue Time Contact Kuching 13 November 2018 Hilton, Kuching 9:00 a.m. 5:00 p.m. Irene Foo / Linda Kuang: Sibu 14 November 2018 RH Hotel 8:00 a.m. 5:00 p.m. Ting Su Ding: Bintulu 15 November 2018 Promenade Hotel 8:30 a.m. 5:00 p.m. Pao Nguk Eng / Daphne Ting: Miri 16 November 2018 Pullman Miri Waterfront 8:30 a.m. 5:00 p.m. Millie Chang / Amelia Chin: Sabah Date Venue Time Contact Kota Kinabalu - TBA - - TBA Tawau - TBA - - TBA Sandakan - TBA - - TBA 13

14 Japanese seminar Date Venue Time Contact Kuala Lumpur 21 November 2018 Ilmiah Room, EY Kuala Lumpur 9:30 a.m. 12:00 p.m. Yoko Yamada: Penang 23 November nd Floor, Conference Room, EY Penang 2:30 p.m. 4:00 p.m. Teoh Zhi Xiang / Kang Mei Siang Johor Bahru - TBA - EY Johor Bahru - TBA - - TBA TBA To be advised 14

15 Are you ready for the Malaysian Business Reporting System (MBRS)? Recently, Suruhanjaya Syarikat Malaysia (SSM) launched the Malaysian Business Reporting System (MBRS), a digital submission platform based on the extensible Business Reporting Language (XBRL) format. The launch was officiated by YB Tuan Chong Chieng Jen, Deputy Minister of Domestic Trade and Consumer Affairs (KPHDNHEP). With the launch of the MBRS, all Malaysian incorporated companies and foreign companies registered under the Companies Act 2016, will need to get themselves prepared to file a full set of financial statements in XBRL format, unless otherwise exempted. Currently, all submissions are voluntary, and registered companies have been encouraged by SSM to use MBRS before the mandatory enforcement. SSM has set out various schedules with implementation dates for the various Zones and states pertaining to mandatory implementation for Annual Returns, Certificates for Exempt Private Companies and Unaudited Financial Statements. However, mandatory implementation for Financial Statements will be advised at a later date. Arising from the above and in the event you wish to understand more or do not have adequate resources to prepare your financial statements in accordance with MBRS requirements, our EY team of professionals is able to assist you in terms of:- MBRS training MBRS outsourcing services Our EY team members are experienced professionals who are SSM-certified trainers for MBRS, and are ready to help you get ready for the above. Our workshops are as follows:- MBRS for Preparers Financial Statements Dates (2-day course) Venue Time Contact 22 & 23 October & 15 November 2018 Ilmiah Room, EY Kuala Lumpur 9:00 a.m. 5:00 p.m. Lim Xin Tong: Billy Teo: acr.seminar@my.ey.com 14 & 15 January & 21 February & 13 March & 18 April 2019 Ilmiah Room, EY Kuala Lumpur 9:00 a.m. 5:00 p.m. Lim Xin Tong: Shalene Gan: acr.seminar@my.ey.com 15