This is not a big concern for the time being. When one retired, one technically do not have any income right? Then only remit back your cpf slowly, year on year.
The remitted funds, even if one cannot prove they are capital vs income, is at most going to be taxed at normal income rate. So technically every year, the first 40K rm is basically tax free.

This post has been edited by Wedchar2912: Dec 21 2021, 05:32 PM

(hopefully not a side track, as I think this is part of cashflow and risk management for individuals)
If one is still working in Malaysia and generating net positive cashflow after expenses, should just keep the CPF/other monies in SG and let it grow there. As currency hedge/lifestyle hedge or if deployed into investments, as diversification. No point bring it back here and suffer currency risk and political risks.
In fact, just MY and SG alone is not diversified enough, as one big Typhoon would blow everything away.... touch wood...

That's why I don't pay too much attention to this foreign income remit back to Malaysia tax as much of an issue for most of us. As long as don't bring back, no problem.

If want to do the proper and legal thing, need to ask your local tax officer. They would be able to advise.

I know that if your income is not high enough, they will not bother to ask you to create a tax file. But this was back when taxes were still filed via paper method.

This post has been edited by Wedchar2912: Dec 21 2021, 07:53 PM

Thank you for sharing the info in the first paragraph.

For your follow-up questions. I am pretty sure that if you send back say 20K per year (there should be a limit, but I don't know the exact limit), there is no need to file anything. Rational: fresh grads in malaysia who earns say 2K per month, are frequently told by LDHN officers that they don't have to open a tax file as their income is too low to be taxed.

The last part I believe many of us are waiting to know the answer.

Rationale is how would LDHN know that when we remit back say 1 million ringgit equivalent, how much of the funds are from income already taxed and how much is from say bank interest/share dividend?

So until our LHDN comes out with much better guidelines and our trust in them improves, the best advice to all is to be smart about this and not to be FLASHY.

those with local assets, any reason to remit funds back?

That maybe the correct advice, but not the best.

even if you paid all accurate taxes, if you are flashy, ldhn still come kacau you.