Govt Extends Tax Incentive For Angel Investors
KUALA LUMPUR, Oct 12 (Bernama) -- The government has proposed to extend tax incentives for angel investors by four years to attract more investors to provide capital funding to technology start-up companies at the pre-seed and seed stages.
According to the tax measures document published by the Finance Ministry, angel investors in technology start-up companies at the pre-seed and seed stage that invest in ordinary shares are eligible for tax exemption at the individual aggregate income equivalent to the amount of investment made in the companies.
Previously, the tax incentive was effective for investments made from Jan 1, 2013 until Dec 31, 2026.
Following the extension, the tax incentives will be effective for investments made from Jan 1, 2027 until Dec 31, 2030.
Additionally, the government has also proposed to extend the Accelerated Capital Allowance (ACA) on capital expenditure for plant, machinery and information and communications technology (ICT) equipment.
The proposal aims to boost domestic direct investment and accelerate the adoption of digital technology in businesses.
Under this incentive, ACA is given on qualifying capital expenditure, with an initial allowance of 20 per cent and an annual allowance of 40 per cent, to be fully claimed by companies within two years.
Qualifying capital expenditure includes the procurement of heavy machinery, plant and general machinery from local manufacturers, as well as the purchase of ICT equipment and computer software packages.
The qualifying capital expenditure also includes consultation, licensing and incidental fees related to the development of customised computer software.
Previously, the tax incentive was effective for qualifying capital expenditure incurred from Oct 1, 2025 until Dec 31, 2026.
With the extension, the tax incentive is now effective for qualifying capital expenditure incurred from Jan 1, 2027 until Dec 31, 2030.
--BERNAMA