Dear all Sifu,

During 2011, I received dividends from listed REAL ESTATE INVESTMENT TRUST (all from Bursa) as follows:

Gross Dividend RM 5980.88 less Tax deducted (10%) of RM598.09.

Here is what my tax agent has done.

A. Statutory Business Income RM xx,xxx
B. Gross Dividend RM 7,177
------------
Less Relief yy,yyy
-------------
Chargeable Income RM zz,zzz

Tax RM KK,KKK
Less Section 10 Dividends RM 1794.26

My question:
1. Isnt 10% withholding tax on reit dividends final??
2. The amount deducted was RM598.09 but the tax agent regross the amount to RM1794.26 and deduct this from tax payable. Is this correct?

Please kindly advise ASAP before I let him submit the tax return.

Many Many Thanks.

This post has been edited by jwong0303: May 23 2012, 03:42 PM

Yes, he summed up all dividends and regrossed.

BUT my worry is from articles I read online, dividends from REIT are already subjected to 10% withholding tax and this tax is final. Meaning, I should not declare these dividends and hence could not claim tax refund on these dividends.

http://www.nbc.com.my/real-estate-investme...t-malaysia.html

Can someone advise what is the real tax law on this?? @.@
Thanks

Further to above, I have called up another licensed tax agent and also talked to my licensed tax agent. BOTH agents said I should declare my dividends from REITS (All Malaysia REITS) and hence claim for tax refund. Under their calculation, after regrossing, I am actually claiming more than the 10% tax deducted at source. Amount deducted at source were RM598.08 but after regrossing, i would be claiming for RM1794.26.

Reading the Annual Reports from these REITS, all the reits income were exempted from income tax. The REIT only withhold 10% tax when they paid the unit holders. As such, the government had actually collected TOTAL tax of RM598.08 from me from the entire process but if I were to claim for RM1794.26, who is paying for difference???? This doesnt make sense at all.

At this juncture, I have decided NOT to declare these dividends from REITS despite what the tax agents had suggested.

If I am wrong, please kindly enlighten. Many thanks