The Inland Revenue Board of Malaysia (IRB) issued Public Ruling No. 12/2016 on December 9, 2016 to explain the tax treatment of income derived by individuals exercising employment aboard ships. The ruling provides clarity on how the provisions under Section 13(2)(e) and Paragraph 34, Schedule 6 of the Malaysian Income Tax Act, 1967 (the Act), respectively, should be interpreted and applied in relation to such individuals. Employers should review this new guidance prior to deploying globally mobile employees working aboard all types of vessels and ensure that proper income reporting and necessary documentation are in place before applicable tax exemptions are claimed.
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Phing Phing Lim
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