Are coupons or sales proceeds from bond investments taxable for individual investors in Malaysia?

Generally, no. The interest income (coupons) and sales proceeds received by resident individuals from most bonds in Malaysia are exempt from income tax.

This includes:

• Ringgit-denominated Government bonds

• Corporate bonds and sukuk approved by the Securities Commission (SC)

However, it's important to note some exceptions:

• Non-resident investors: Interest earned by non-residents may be subject to withholding tax.

• Specific bond types: There may be specific exemptions or tax implications for certain types of bonds.

What about capital gains?

• Selling a bond for a profit (capital gain) may be subject to tax, but specific exemptions or tax reliefs might apply for long-term investments.

Where can I find more information?

For detailed information and to confirm your specific tax liability, it's recommended to:

• Consult a tax professional: They can provide personalized guidance based on your situation.

• Refer to the Malaysian Inland Revenue Board (IRBM) website: https://www.hasil.gov.my/

Additional Points:

• Corporations: While individuals are exempt, companies incorporated in Malaysia are generally subject to income tax on their bond earnings depending on their tax bracket.

• Tax Incentives: The Malaysian government offers tax incentives for bond investment. However, details can get complex. To understand these incentives, refer to a tax advisor.

• Sukuk: Tax treatment for Islamic bonds (Sukuk) might differ. For specific information, consult the SC website: https://www.sc.com.my/development/icm/incentives

Remember, tax laws can change. Stay updated with the latest information from reliable sources like the IRBM.