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losses can be carried forward to subsequent years of assessment to be deducted against future business income. 4.2 Effective year of assessment 2019, a new provision under subsection 44(5F)
The PR explains how the adjusted income or losses of a business are ascertained, and the tax treatment of adjusted business losses (in the year the losses arose, as well as the unabsorbed business losses carried forward).
The Inland Revenue Board has issued PR 1/2022 - Time Limit for Unabsorbed Adjusted Business Losses Carried Forward (“PR 1/2022”) dated 30 June 2022. PR 1/2022 explains the treatment of carry forward of unabsorbed business losses.
Any unutilised losses can be carried forward for a maximum period of 10 consecutive YAs to be utilised against income from any business source. Unutilised losses accumulated as at YA 2018 can be utilised for 10 consecutive YAs and any balance will be disregarded in YA 2029.
The Malaysia Inland Revenue Board (“MIRB”) has released Public Ruling No. 01/2022 on Time Limit For Unabsorbed Adjusted Business Losses Carried Forward, which stipulates a new time limit for taxpayers to carry forward unabsorbed business losses.
The carried forward of unabsorbed company losses would be extended for 10 instead of 7 consecutive years of assessment, as was indicated in the Budget 2022. In light of this, section 44(5F) has been amended with retrospective effect from YA 2019.
Jun 26, 2024 · Unutilised losses in a year of assessment can only be carried forward for a maximum period of ten consecutive years of assessment while unabsorbed capital allowance can be carried forward indefinitely.
