Double Tax Treaty Malaysia – Australia

Updated on Tuesday 23rd May 2017

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Malaysia and Australia signed a double tax treaty for the avoidance of double taxation and fiscal evasion, entered into force on June 26, 1981. From 1981 to 2010, this double tax treaty between Malaysia and Australia has been amended three times over issues concerning exchange of information and business profits. Opening a company in Malaysia can be a very profitable decision, if you are familiar with the financial regulations of this country. A detailed presentation of the legal provisions stipulated in this double tax agreement can be offered to you by our company incorporation specialists in Malaysia.


Taxes covered by the double tax treaty Malaysia – Australia

 The provisions of this agreement apply to several existing taxes:

• in Malaysia – income tax, excess profit tax, supplementary income taxes (petroleum income tax, development tax and timber profits). The stipulations of this agreement replace the existing taxes (similar or identical) imposed by the contracting states in regard to the above mentioned taxes. All corporations paying taxes in Malaysia are subject to this agreement.
• in Australia – the Australian income tax and the supplementary tax upon the undistributed amount of the shared income of a private corporation.

The effects of this agreement will continue indefinitely, until the governments of the two countries, through diplomatic channels, address a notice of termination. There are certain regulations under which this double tax treaty ceases to be effective. When you set up a company in Malaysia, you should be aware of the existing double tax treaties and their requirements. Our company formation experts in Malaysia can provide you with the details regarding the enforcement of this agreement.


Business profits under the double tax treaty provisions

This agreement signed by authorities of the two states addresses the profits gained by corporations in Malaysia and in Australia. The profits of a company in one of the contracting states are taxed in the country where the business is permanently established. When the profit of a permanently established company is assessed for taxation, the administrative and executive expenses are deducted. Goods or merchandise purchased for the permanently established enterprise are not considered income or profits. The representatives of a company who are in charge with tax planning have to consider the provisions of this double tax treaty.

Don`t hesitate to contact our local team of company formation experts for professional help.


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