The approval period for tax treatment on IOT is limited to a maximum of 10 years

KUCHING: The Malaysian Inland Revenue Board (HASiL) has determined that starting November 27, 2025, the approval period for tax treatment of Institutions, Organisations or Funds (IOT) under Subsection 44(6) of the Income Tax Act 1967 (ACP 1967) is limited to a maximum of 10 years only.

According to a statement from HASiL, the setting of the new period is intended to coordinate and improve transparency in the management of IOT approvals that receive benefits under the relevant provisions.

“Among the tax benefits received by IOTs with the approval of Subsection 44(6) are tax deductions on donations or contributions given to IOTs (limited to 10 percent of the aggregate income of individuals or companies) as well as the exemption of all income received by IOTs throughout the approval period,” he said.

Therefore, for IOTs whose approval period will expire on 31 December 2025 as previously announced, HASiL will issue a new notification letter to explain the application of the 10-year approval period.

However, any IOT that has received a new or extended approval before 27 November 2025 will continue to use the approval period as stated in the original approval letter, and only after that period has expired will a new 10-year approval be considered.

HASiL also informed that compliance reviews will be conducted from time to time, taking into account document retention requirements as well as time limits provided under the law.

“IOT must ensure full compliance with all approval requirements as per the guidelines in force.”

“If there is a breach of conditions, the approval under subsection 44(6) may be withdrawn and the IOT income may be subject to tax,” the statement explained.

The public or IOT parties who have questions can contact; Hasil Contact Centre (HCC): 03-8911 1000 / 603-8911 1000 (Overseas) HASiL Live Chat Feedback Form: via the official HASiL portal at the link customerfeedback.hasil.gov.my

-Agency