Julie, a British citizen and not a Malaysian permanent resident, bought a two-acre land in Janda...

   

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Julie, a British citizen and not a Malaysian permanent resident, bought a two-acre land in Janda Baik, Pahang for a consideration of RM1,200,000. She settled the full payment to the seller on 14 September 2016, and ownership was transferred on 25 September 2016. There was no written agreement for the purchase. She divided the land into two parts of one-acre each. She built a bungalow as her holiday house in one part and a resort on the other part. Below are the transactions related to the land: Date Dec 2016 March 2018 Feb 2017-Nov 2017 April 2018 May 2018 January 2019 Transactions Constructed the bungalow. Total cost incurred was RM540,000. Constructed the resort. Total cost incurred was RM680,000. Constructed a swimming pool for the bungalow, cost RM25,000. Paid an interior designer for designing and furnishing the inside of the bungalow amounted to RM142,000. Received compensation of RM60,000 from the owner of the adjacent land as his construction activities caused damages to the resort. Date March 2020 May 2020 June 2020 October 2020 Transactions Engaged a property agent to sell the resort. His fee was RM30,000. Transferred the ownership of the bungalow to her son, David on 6 May 2020. David is a British citizen but holds permanent residency status of Malaysia. Market value on the date of transfer was RM1,380,000. An interested buyer paid deposit RM45,000 to purchase the resort. However, he cancelled the purchase and his deposit was forfeited. Sold the resort for RM1,620,000. Paid legal fee and stamp duty RM21,000 for the sale. Sale and purchase agreement was sign on 16 October 2020. Ownership was transferred on 4 November 2020. i) Determine the date of acquisition and the date of disposal of the bungalow and the resort. (2 marks) ii) Compute the RPGT payable by Julie for the disposal of the bungalow and the resort. (11 marks) b) Amani, a Malaysia citizen, holds 300,000 shares in Melati Sdn. Bhd., a controlled company with 1,500,000 issued capital, acquired on the following dates: 150,000 units were purchased on 13 Dec 2016 for RM150,000 100,000 units were purchased on 28 Jan 2018 for RM160,000 50,000 units were purchased on 15 March 2019 for RM100,000 Below are the transactions related to acquisition and disposal of real properties held for investment by Melati Sdn. Bhd.: • • • On 7 May 2016, acquired real properties for RM400,000 On 9 June 2017, acquired real properties for RM1,600,000 On 7 June 2018, disposed the real properties acquired on 7 May 2016 The value of other tangible assets during 2016 until 2018 is RM600,000. Assume the value of real properties remain the same throughout the period. On 1 September 2020, Amani disposed all 300,000 shares in Melati Sdn. Bhd. for RM750,000. Required: State, with reason, whether Melati Sdn. Bhd. is a real property company between 2016 until 2020. State also the relevant dates involved. (3 marks) ii) Compute RPGT payable, if any, by Amani upon disposal of the shares in Melati Sdn. Bhd. i) Julie, a British citizen and not a Malaysian permanent resident, bought a two-acre land in Janda Baik, Pahang for a consideration of RM1,200,000. She settled the full payment to the seller on 14 September 2016, and ownership was transferred on 25 September 2016. There was no written agreement for the purchase. She divided the land into two parts of one-acre each. She built a bungalow as her holiday house in one part and a resort on the other part. Below are the transactions related to the land: Date Dec 2016 March 2018 Feb 2017-Nov 2017 April 2018 May 2018 January 2019 Transactions Constructed the bungalow. Total cost incurred was RM540,000. Constructed the resort. Total cost incurred was RM680,000. Constructed a swimming pool for the bungalow, cost RM25,000. Paid an interior designer for designing and furnishing the inside of the bungalow amounted to RM142,000. Received compensation of RM60,000 from the owner of the adjacent land as his construction activities caused damages to the resort. Date March 2020 May 2020 June 2020 October 2020 Transactions Engaged a property agent to sell the resort. His fee was RM30,000. Transferred the ownership of the bungalow to her son, David on 6 May 2020. David is a British citizen but holds permanent residency status of Malaysia. Market value on the date of transfer was RM1,380,000. An interested buyer paid deposit RM45,000 to purchase the resort. However, he cancelled the purchase and his deposit was forfeited. Sold the resort for RM1,620,000. Paid legal fee and stamp duty RM21,000 for the sale. Sale and purchase agreement was sign on 16 October 2020. Ownership was transferred on 4 November 2020. i) Determine the date of acquisition and the date of disposal of the bungalow and the resort. (2 marks) ii) Compute the RPGT payable by Julie for the disposal of the bungalow and the resort. (11 marks) b) Amani, a Malaysia citizen, holds 300,000 shares in Melati Sdn. Bhd., a controlled company with 1,500,000 issued capital, acquired on the following dates: 150,000 units were purchased on 13 Dec 2016 for RM150,000 100,000 units were purchased on 28 Jan 2018 for RM160,000 50,000 units were purchased on 15 March 2019 for RM100,000 Below are the transactions related to acquisition and disposal of real properties held for investment by Melati Sdn. Bhd.: • • • On 7 May 2016, acquired real properties for RM400,000 On 9 June 2017, acquired real properties for RM1,600,000 On 7 June 2018, disposed the real properties acquired on 7 May 2016 The value of other tangible assets during 2016 until 2018 is RM600,000. Assume the value of real properties remain the same throughout the period. On 1 September 2020, Amani disposed all 300,000 shares in Melati Sdn. Bhd. for RM750,000. Required: State, with reason, whether Melati Sdn. Bhd. is a real property company between 2016 until 2020. State also the relevant dates involved. (3 marks) ii) Compute RPGT payable, if any, by Amani upon disposal of the shares in Melati Sdn. Bhd. i)

Answer rating: 100% (QA)

Part a 1 i Determine the date of acquisition and the date of disposal of the bungalow and the resort Date of Acquisition Julie settled the full payment and ownership was transferred on 25 September 20... View the full answer