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## **Accelerating an economic reset**

**Kuala Lumpur - 29 October 2021** - The recent budget announcement holds good potential for SMEs, according to Datin Yap Shin Siang, CEO of YYC Group, a local tax and accounting firm founded in 1974 which is one of the top 10 accountancy firms in Malaysia. As their competency is in serving the SME market, her analysis will focus on the Budget Announcements that most affect SMEs. 

Datin Yap noted that the budget is a good way to “accelerate an economic reset  and restart the economy”. Yap mentioned: “One of the most important things in a business is cash flow - it’s good that the government has introduced 3 initiatives to ease working capital requirements for SMEs, including Micro Credit Scheme, Business Financing and Alternative Financing, Bank Negara Malaysia Funds and Business Finance Guarantee Scheme. These schemes range from RM10,000 to RM 10 million in financing, and are suitable for micro enterprises to small medium enterprises (SMEs). 

Notably, on the income tax front, SMEs have the ability to defer their income tax installments up to 30th June 2022. In addition, all businesses are allowed to make tax estimate amendments for income payable in the 11th month before October 31, 2022; (previously only available in the 6th and 9th months). As for manufacturing companies, the reinvestment allowance has been extended for another 2 years until 2024.

Yap noted: “Companies are given good encouragement to renovate their premises, with a tax deduction on costs of renovation and renewal of premises up to RM300,000 until end of the year 2022, with an extension of special deduction for renovation of business facilities to comply with SOP requirements such as ventilation upgrades, customer seating and employee  infrastructure. Landlords who give a rental reduction of at least 30% are rewarded with a special tax deduction until June 2022 (extended from January 2022).

 There will also be a real property gains tax (RPGT) exemption for any individual Malaysian citizens who hold property for more than 5 years. No RPGT will be imposed from the 6th year onwards, as opposed to the current 5%.

 To stimulate business activity, newly incorporated SMEs (incorporated in  between 1 July 2020 until 31 December 2022) are given an income tax rebate of RM20,000 for every year for the next 3 years. SME business owners can benefit from up to 20-40% wage subsidies, for up to 6 months under the Jamin Kerja initiative. Under the PERANTIS scheme, an allowance of up to RM900 per month for 6 months for graduates and school leavers from 18-30 years old on the executive level, for those with a diploma and above will be given.”

 Yap also noted: “On the individual front, the additional RM2,500 tax relief for purchase of handphone, notebooks and tablets has been extended for another one year up to year of assessment 2022. There is also further extension of tax relief for domestic travel expense of up to RM1,000 for another year. Lastly, tax relief for fees paid to child care and kindergarten of RM3,000 has been extended for another 2 years. “

 Under the Keluarga Malaysia concept, it is good to see the people being allocated for. With all the tax breaks, one may wonder if the government will have enough funds - and thankfully, those companies are making huge profits above more than RM100 million, will have a one-off taxed at 33% instead of the usual 24%.

Yap concludes: “The new realities of Covid 19 and changes in leadership in the nation has left many of us quite drained, but this new budget offers some hope that we will be able to recover quickly as a nation. I urge you to take advantage of the opportunities given to get back to work, upskill, and stimulate the economy. Notably, the government has been listening to the people, and the personal mentions of several successful startup founders during the budget announcement as well as even e-sports personalities that won international tournaments show that they are in tune with current economic developments. All in all, it is a good step towards Malaysia’s recovery, and future prosperity”.

 **\
About the author:**\
*Datin Yap Shin Siang, CA(M), CPA (AUST), CFP, MBA (U.K), B.COM (MELB)*

*Group CEO, YYC Group*

Yap Shin Siang, or fondly known as Shin, she estimates that the firm is already in the top 10 accountancy firms by size and can rival the Big Four locally. She took over the family business, shook off gender biases, and grew a small business into a major player. Being the second generation in the family business, she has grown a team of 50 staff to almost 800 staff today. She has also tripled the business revenue since 2016, and won the attention of OCBC Bank to invest and become a strategic partner.

She has over 20 years of professional experience in public accounting, tax and business advisory. Shin is the author of two business titles and is also a frequent speaker for seminars organised by China Press, Nanyang Siang Pau, Malaysian Institute of Accountants (MIA) and various trade associations such as Malaysia Retail Chain Association (MRCA), Master Builders Association Malaysia (MBAM), The Timber Exporter’s Association of Malaysia (TEAM) and many more.

She has also provided oversight on many tax investigations and tax audits with the Inland Revenue Board and Royal Malaysian Customs Department. Shin holds a bachelor’s degree from University of Melbourne, an MBA from University of Nottingham, and is a member of CPA Australia and MIA. Shin’s vision is to make YYC Group the No.1 world-class accounting firm that originated from Malaysia via innovation.

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