MYKL Advisory

19/02/2023

Malaysia's Employment Pass Cat lll and Professional Visit Pass to be endorsed at ESD Satellite Centre

The guidelines for the procedure, which is compulsory for incoming expatriates, are shared here.
From 20 February 2023, endorsement at the Kuala Lumpur International Airport 1 (KLIA1) ESD Satellite Centre (ESC) will be extended to all new applications of Employment Pass Category lll (EP lll) and Professional Visit Pass (PVP). As such, endorsement by the Immigration Department of Malaysia (JIM) is compulsory for expatriates entering via KLIA1 in these two categories.

Guidelines for endorsement procedure at the ES Satellite Centre (ESC), KLIA 1
The following applies to new pass applications for expatriates currently abroad for registered companies in the Expatriate Services Division (ESD). This would include:

Employment Pass (Category I, II & III)
Dependant/s to Expatriate for (Category I & II)
Long Term Social Visit Pass (LT-SVP) for Expatriate (Category I & II)
Professional Visit Pass (PVP)
Pass approval stage

Company applies through ESD portal and proceeds with the online payment.
Expatriate processing fees: RM800. The processing charter is five working days upon complete submission.
If the application is approved, the company will receive a notification of pass approval via email and proceed to the endorsement module.

If the application is rejected, the company will receive a notification via email on the refund of expatriate processing fees of RM300.

Endorsement stage

Company initiates endorsement stage, and uploads the following documents:
Passport ID page
Visa sticker (if applicable)
Copy of flight ticket
The processing charter is three (3) working days upon complete submission.
Pass printing at ESC, KLIA 1

After verification of the documents and approval by JIM, the company will receive the following notifications via email:
To proceed with the payment of Immigration Fee
Approval Letter for Endorsement of Pass at ESC, KLIA1.
The company will then need to download the Approval Letter and share it with the applicant abroad.
Applicant may now prepare for entry into Malaysia.
The following documents are required prior to entry:

Original passport
Approval Letter for Endorsement of Pass at ESC, KLIA1
Any supporting documents
Following immigration clearance at KLIA1, the applicant will need to proceed to the ESC for passport verification and endorsement. Approval of pass endorsement at KLIA is subject to JIM’s discretion.

Guidelines for pass delivery
The following applies to new/renewal pass application. This includes:

Employment Pass (Category I, II & III)
Dependant/s to Expatriate for (Category I & II)
Long Term Social Visit Pass (LT-SVP) for Expatriate (Category I & II)
Professional Visit Pass (PVP)
Pass approval stage

Company applies through ESD portal and proceeds for the online payment.
Expatriate processing fees: RM800
The processing charter is five working days upon complete submission.
If the application is approved, the company will receive a notification of pass approval via email and proceed to the Endorsement module.

If the application is rejected, the company will receive a notification via email on the refund of expatriate processing fees of RM300.

Endorsement stage

Company initiates endorsement stage and is to upload the following documents:
Passport ID page
Visa sticker (if applicable)
Valid Pass/Latest entry stamp
After verification of documents and approval by JIM, the company will receive notification via email to proceed with the payment of immigration fee. The processing time is three working days upon complete submission.
Delivery of endorsed pass

Upon successful payment, the Pass will be delivered to the company by Pos Malaysia as follows:

Klang Valley: two working days
Other states: three working days
Federal Territory of Labuan: five working days
A notification via email will be sent to the company to notify on the delivery date. The pass will be delivered to the company correspondence address as registered in the ESD portal.

Recipients address to all four listed names in Letter of Undertaking (LoU):

Endorser
Company Login ID User
Submission officer 1
Submission officer 2
For changes/amendments kindly refer to Inspectorate Unit, ESD Putrajaya.

Delivery process by Pos malaysia

Any of the four company representatives in the LoU mentioned above will need to make themselves available to receive the pass during this period. Representative in the LoU need to be prepared with:

LoU identification (passport/IC)
Applicant’s original passport
A notification via email will be sent to the company to notify on the delivery date. The representative in the LoU will need to open the package immediately and ensure that the pass and all the details are correct.

They are to peel off the pass and paste it on to the applicant’s passport. The remaining pass, which is a duplicate copy, is to be returned to the Pos Malaysia Officer right after.

19/02/2023

https://www.theedgemarkets.com/node/654947

Do we want the Malaysia My Second Home (MM2H) programme? Considering how evidently the pros outweigh the cons, the answer’s a no-brainer. So, let’s just get our act together: Enable the programme to help shore up the Malaysian economy. MM2H was unveiled by the government in 2002 to attract forei...

13/02/2023

Tourism Minister Wants Malaysia To Provide Visa-On-Arrival To All Countries

Datuk Seri Tiong King Sing suggested this especially for tourists from China and India, as well as to prevent Malaysia from losing its competitiveness within the region.

11/01/2023

Discover 10 of the best countries for expats that offer a decent quality of life and an affordable cost of living.

11/01/2023

Labuan transformed into regional business and financial centre

LABUAN: Labuan has transformed and diversified into a regional business and financial centre with substance from an international offshore financial centre in the 1990s, Labuan Financial Services Authority (Labuan FSA) Director-General Nik Mohamed Din Nik Musa said.

11/01/2023

Labuan issued a new tax framework in early 2019, which impacts a variety of tax requirements, such as the abolition of the 20,000-ringgit tax ceiling.

11/01/2023

New provisions in the Labuan Companies Amendment Bill 2022 affect corporate governance and increases the authority of the financial services regulator.

06/10/2021

Since 2014, 100+ company, family and personals successfully established here in Malaysia with support from MYKL Advisory (previously known as Azrena Shariff & Partners)

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http://www.wasap.my/+60176977314

Getting it Right the First Time!

It is important to get the first step right from day one, once you have made the decision to start a business in Malaysia. Doing it right from the beginning will help your renewal process go smoothly for all matters on your trade license, visa, taxation, etc., for the onward years.

MYKL Advisory, a professional business consultant firm, specialized in servicing both local and foreign entrepreneurs in Malaysia with the service in securing the necessary documentation and licenses while guiding you to understand and comply with the local rules and regulations pertaining to setting up business in Malaysia.

At MYKL Advisory, we act as your Independent Business Advisor providing services, which include complete peripheral support from incorporation, licensing, visa, accounting, tax including offering latest updates and advice on changes that may take place in various Governmental Departments which may affect you and your business. Acting as your liaison person to conduct due diligence, fact-finding, and negotiation, our goal is to assist in minimizing your investment risk to the lowest.

With our expertise and experiences dealing with more than 60 different nationalities worldwide, our roles in business investment services are craved and dedicated only to foreigners, be it a pure investor or businessman who likes to start a business in Malaysia.

• Business Consulting
• Labuan Offshore Company Formation
• Labuan Offshore Business Visa
• Labuan Offshore Financial Services
• Business & Tax Registration
• Business Banking & Finances
• Audit & Accounting
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• Public Relations & Marketing

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(Previously known as Azrena Shariff & Partners, Since 2014)
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55100 Kuala Lumpur
Tel: 603 2149 9271 / 6017 6977 314
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06/10/2021

Malaysia lifts incoming travellers' ban on 5 countries: India, Sri Lanka, Pakistan, Bangladesh, and Nepal

All travellers who have obtained entry approvals through MYEntry, MYTravelPass, or others will need to adhere to the requirements of being fully vaccinated, COVID-19 PCR test on arrival, and quarantine.
Malaysia has lifted entry restrictions from five previously banned countries, subject to strictly following the conditions set in place by the Immigration Department. These five countries are: India, Sri Lanka, Pakistan, Bangladesh and Nepal, where incoming travellers can now enter Malaysia to work only.

This is per the 23 September notification by Jabatan Imigresen Malaysia (Immigration Department of Malaysia, or JIM).

Immigration Department's Director-General Khairul Dzaimee Daud affirmed that even though the Special Committee of Pandemic Management has agreed to allow the re-entry of citizens from these five countries, they need to comply with the conditions contained in MyTravelPass, as told to Berita Harian and shared on JIM.

Currently, the following types of travellers from these five countries may seek entry approval through MyTravelPass or MyEntry:

Malaysian permanent residents (PR)
Long-term pass holders
Business travellers
Investors
Among the foreigners who can apply in MyTravelPass are those with PR status, and those who apply through their employers in either the category of Foreign Maid (Pembantu Rumah Asing, or PRA) and Temporary Work Visit Pass (Pas Lawatan Kerja Sementara, or PLKS).

For each of these categories, the following rules need to be followed by both applying employers and their foreign workers:

Employers need to submit an application first by attaching an official application letter, front and back of foreign worker's passport, and latest visit pass for temporary jobs.
Foreign workers need to undergo COVID-19 health screening in their respective countries at least three days before departing, and after testing negative, it is also mandatory to download the MySejahtera app.
Entry of foreign workers into Malaysia can only be through Kuala Lumpur International Airport (KLIA), KLIA2, KLIA, Bayan Lepas International Airport, and Sultan Ismail, Senai, Johor.
Foreign workers also need to also attach a temporary work visa that is still valid for re-entry visa or a temporary work pass visa without visa re-entry. All foreign nationalities must obtain this visa before entering.
It is also mandatory to obtain visa without referral (VTR) from the Malaysian Embassy, Consulate or High Commission before entering the country.
TalentCorp, which runs the Returning Expert Programme (REP), reinforced in its statement that permission to enter Malaysia is subject to the decision and discretion of the Immigration Department of Malaysia.

All travellers who have obtained entry approvals through MYEntry, MYTravelPass, or other entry approvals will need to adhere to the following requirements set by the Ministry of Health (MOH) to curb the spread of COVID-19:

Fully vaccinated
COVID-19 PCR test during arrival
Quarantine

Details:

All travellers who have obtained entry approvals through MYEntry, MYTravelPass, or others will need to adhere to the requirements of being fully vaccinated, COVID-19 PCR test on arrival, and quarantine.

06/10/2021

KUALA LUMPUR (Oct 5): The government has relaxed its rules for existing participants of the Malaysia My Second Home (MM2H) programme after industry backlash to the revised criteria. They now have to adhere to only two of 10 new criteria under the revamped programme, which was revealed by the Ministry of Home Affairs last August.

The two new conditions are the increase in annual fee to RM500, from RM90 previously, and the requirement to stay in the country for a minimum of 90 days each year, said Home Minister Datuk Seri Hamzah Zainudin.

Speaking in the Dewan Rakyat on Tuesday, Hamzah gave his assurance to existing MM2H participants that they will not be bound by the other new conditions.

“However, for all new participants, they have to comply with the new requirements of the MM2H programme to ensure that only those who are genuine, of high quality and can provide positive contribution to the country’s economic growth (are allowed to join the programme),” he said.

Hamzah reiterated that the policy changes for the MM2H programme were not drastic as they were based on early assessments conducted back in 2019 and that they also involved several ministries and related agencies.

“A study involving stakeholders from the private sector was also conducted by the Ministry of Tourism, Arts and Culture (Motac) through the appointment of a consultant,” he said.

“The objective of MM2H is to provide the opportunity for high-quality retirees and participants to live and spend in Malaysia.

“For the purpose of business, investments and job opportunities, the Immigration Department offers other facilities and passes, including the Expatriate Pass and the Residence Pass-Talent,” he added.

After a hiatus of about a year, the Ministry of Home Affairs in August announced that applications under the programme will recommence in October and will be processed by the Immigration Department instead of Motac. While stakeholders in the industry welcome the return of the programme, many have voiced concerns over the new thresholds for the financial requirements, describing them as “draconian” and illogical amid an economy still struggling to recover from the Covid-19 pandemic.

Under the revamped programme, a participant must now have a minimum offshore income of RM40,000 a month. This is a fourfold increase from RM10,000 previously. In addition, a participant must also have a minimum fixed deposit (FD) of RM1 million in a Malaysian bank — up from RM150,000 for applicants aged 50 or older, and RM300,000 for those below 50 previously.

Applicants must also prove that they have liquid assets of RM1.5 million, compared with the previous requirement of RM500,000 for applicants below 50 years and RM350,000 for those 50 and above.

On a related matter, Hamzah said the relocation of the MM2H Centre to the Immigration Department from Motac is in line with the practices in other countries including Australia, Portugal and the US.

However, the promotion of the programme as well as appointment of MM2H agents remains under Motac, he added.

Last month, Hamzah told the Dewan Rakyat that the conditions were tightened after the Immigration Department found that more than 7,000 of the 57,478 foreigners enrolled in the programme were believed to be not residing in Malaysia.

He said at the time that the stricter new criteria was for security purposes as “some of them are disguising as MM2H participants, but they are actually using it as a ‘transit’ to carry out unwanted activities, in terms of security”.

According to data provided by Malaysia My Second Home Consultants Association between 2002 and 2019, the programme contributed RM38.17 billion in revenue, of which RM19.36 billion included one-off purchases such as visa fees, and purchases of big-ticket items like houses and cars, and another RM19.41 billion was for annual medical insurance and household expenses.

The Ministry of Home Affairs, however, said the programme’s revenue contribution was lower at RM11.89 billion during the period, which was derived from visa fees, property and vehicle purchases, FDs and monthly household income.

KUALA LUMPUR (Oct 5): The government has relaxed its rules for existing participants of the Malaysia My Second Home (MM2H) programme after industry backlash to the revised criteria. They now have to adhere to only two of 10 new criteria under the revamped programme, which was revealed by the Ministr...

02/03/2021

Labuan, a federal territory of Malaysia, issued a new tax framework in early 2019, which impacts a variety of tax requirements, such as the abolition of the 20,000-ringgit (US$4,914) tax ceiling.

The Labuan International Business and Financial Centre (IBFC), the entity managing Labuan, hopes these changes will increase the region’s business competitiveness.

Other significant changes include the requirement of economic substance for Labuan entities, which involves employing full-time employees and minimum annual spending.

Labuan is a federal territory of Malaysia comprising of seven small islands located off the coast of Sabah in East Malaysia. Its capital, Victoria, is a well-known offshore financial center, offering a variety of financial and business services through the Labuan International Business and Financial Centre (IBFC) — a special economic zone.

WE CAN HELP WITH YOUR INVESTMENTS IN MALAYSIA

International businesses are attracted to Labuan’s favorable tax structure for non-residents and business-friendly environment, making the territory one of the preferred destinations for offshore company formation. Moreover, Labuan is strategically located near Asia’s main financial and business hubs of Singapore and Hong Kong, in addition to access to the fast-growing regions of ASEAN.

During 2019, the IBFC saw 981 new company incorporations, with 58 percent originating from the Asia-Pacific region. Further, the IBFC implemented the new Labuan IBFC tax framework in early 2019 to comply with the Organization for Economic Co-operation and Development’s (OECD) international tax standards.

Features of Labuan’s new tax framework
The IBFC introduced a new tax framework, also known as the Labuan Business Activity Tax Act, 1990 (LBATA), in 2019 to address elements of harmful tax practices that hindered the competitiveness of Labuan IBFC.

The revised framework contains the following:

The abolition of the flat tax rate – a Labuan taxpayer undertaking ‘Labuan trading activities’ can no longer elect to pay tax at the 20,000 ringgit (US$4,914) tax ceiling. Instead, the tax rate will be fixed at three percent on net profits from Labuan’s business activities. Businesses undertaking ‘Labuan non-trading activities’ continue to be exempt from tax under LBATA regulations.

Labuan entities can now undertake a Labuan ‘business activity’ with Malaysian residents and using the ringgit currency, whereas previously, business activities could only be done in, from, or through Labuan, utilizing a foreign currency and with a non-resident/Labuan entity.

Malaysian entities making transactions with a Labuan entity are now entitled to an income tax deduction on any expenditure that occurred, although this is limited to a rate of three percent.

Any income incurred from intellectual property rights is now subject to tax under the Malaysian Income Tax Act, 1967 (ITA), instead of the (LBATA). This means the new prevailing tax rate is 24 percent.

Prior to the changes, Malaysian taxpayers could claim a 100 percent tax deduction on payments made to a Labuan entity. Business entities can now only claim partial tax deductions with the maximum deductions as follows:

Interest payments — 67 percent;
Lease rentals — 67 percent; and
Other payment types — three percent.
Businesses should note that Labuan trading activities include:

Trading;
Management;
Insurance;
Banking;
Shipping; or
Operations that are not classified as Labuan non-trading activities.
Labuan non-trading activities are related to investments in:

Shares;
Loans;
Deposits;
Stocks; or
Securities.
Overview-of-Labuan-Tax-Structure

New substance requirements for Labuan entities
Labuan entities are now required to fulfill criteria related to ‘economic substance’ (substance over form). This accounting principle ensures that financial statements provide an accurate view of all transactions. This also prevents artificial business structures from being used for tax avoidance.

The LBATA requires businesses undertaking Labuan business activities to have between a minimum number of full-time employees and annual spending. These are:

Labuan holding companies undertaking purely equity holding activities do not require any full-time employees but must have a minimum of 20,000 ringgit (US$4,914) in annual expenditure;
Labuan holding companies undertaking other than pure holding activities require one full-time employee and have a minimum of 20,000 ringgit (US$4,914) in annual expenditure; and
Labuan companies that undertake legal, accounting, and administrative services, such as payroll services, management services, and agency services, among others, must hire two full-time employees and have a minimum of 50,000 ringgit (US$12,285) in annual expenditure.
Taking advantage of Labuan’s DTA network
Labuan entities enjoy all the double tax avoidance (DTA) benefits of Malaysia, which spans over 70 countries.

The withholding tax rate is only subject to non-residents in Malaysia. Dividends are subject to a zero percent withholding tax and interest paid to non-resident companies are subject to a 15 percent tax rate. Royalties are subject to a 10 percent withholding tax.

Countries-with-Signed-DTAs-with-Malaysia

There are exceptions, with 11 countries not recognizing Labuan as part of Malaysia because of its status as an IBFC, and thus the DTA does not apply in these cases. The countries are:

Australia;
Chile;
Germany;
Indonesia;
India;
Japan;
Luxembourg;
The Netherlands;
Seychelles;
South Africa;
South Korea;
Spain;
Sweden; and
UK

Labuan companies wishing to benefit from DTAs from the aforementioned 14 countries can do so by applying to be taxed under the ITA, in which net profits would be taxed at 24 percent.

Labuan issued a new tax framework in early 2019, which impacts a variety of tax requirements, such as the abolition of the 20,000-ringgit tax ceiling.

02/03/2021

Due to COVID-19 and its impact on companies, people in many countries have lost their jobs and Malaysians are not spared from this. As part of the Malaysian Government’s initiative to provide employment opportunities to Malaysians, the Department of Labor has introduced a new job advertisement requirement for employers in Malaysia seeking to employ expatriates (“New Requirements”).

Key information of the New Requirements are summarized below:

Summary of Key Information

1. Effective date

The New Requirement came into force on January 1st, 2021.

2. To whom do the New Requirements apply?

Employers in all sectors in Malaysia that intend on hiring expatriates via employment pass only. Employers that wish to hire expatriates by way of a Professional Visit Pass or Resident Pass-Talent are not required to adhere to the New Requirements. For information, there are 3 categories of expatriates regulated by the Ministry of Home Affairs:

3. What do the New Requirements entail?

Employers that intend to employ expatriates are required to advertise job vacancies for a minimum of 30 days on MYFutureJobs Portal under the Ministry of Human Resources. Employers are also required to conduct interviews as an effort to employ local workers to meet the pre-condition for hiring expatriates.

4. What are the steps required to meet the New Requirements?

a. To register vacancies on the MYFutureJobs portal for a minimum of 30 days and ensure all details pertaining to the vacancies are provided.

b. Employers are required to conduct interviews as an effort to source local talent within 30 days from the vacancy advertisement date and submit a report on the interview via the Hiring Outcome Report that can be downloaded at www.perkeso.gov.my;

c. Employers are required to update the company’s labor information in the ePPAx System (https://www.eppax.gov.my/eppax/login) for compliance monitoring on Employment Standards on the 8th day after the vacancy has been posted and activated on the MYFutureJobs portal;

d. All employers’ applications for expatriates will be presented to the Expatriates Placement Committee (JPPD) who will consider the applications by taking into account employers’ efforts in acquiring local talent.

5. Are there any exemptions?

Yes, the hiring of expatriates by the following categories of employers are exempted from the New Requirements:

a. Employers who intend to hire expatriates with key positions in an organization such as Chief Executive Officer, Chief Information Officer and expatriates earning a monthly basic income of RM15,000 and above;

b. The representative office / regional office of overseas organizations / companies in the manufacturing and services sectors that are established in Malaysia to carry out activities for the company / organization headquarters;

c. Investors or shareholders who are directly involved in the company’s operations – investors in this context refers to individuals who invest funds in Malaysia to achieve return of investment whilst shareholders are required to hold at least 30% equity shares and be appointed as the company’s director or hold other key positions;

d. Companies which receive expatriate employees from a parent company for the purposes of training or knowledge / experience sharing between companies and to meet the needs of the companies’ workforce;

e. Organizations subject to the International Organization Act (Privileges and Immunities) (Act 485) that may appoint Foreign Recruited Staff from foreign nationals; and

f. Sports organizations / club in the country for its recruitment of athletes / professionals.

6. What about renewal of employment pass?

For the purpose of renewing employment pass for approved positions, employers are not required to re-advertise vacancies or conduct job interviews. Instead, employers may liaise directly with the Immigration Department of Malaysia / Approval Agency for the purpose of renewing the existing employment pass.

Conclusion

The implementation of the New Requirements should be taken into account by the employers into their recruitment process as priority will need to be given to local candidates and there will be additional lead-time that will be incurred before an expatriate may be hired for a vacant position.

Contact us for more information or visit www.azrenapartners.com