Poto Bhd (PB), a manufacturing company and was incorporated in Kelantan on 1 February 2014 with an authorized and paid-up share capital of RM50 million. PB is engaged in producing promoted products. The company had acquired a piece of land for RM5 million and construct a factory on the land. PB completed the construction of the factory on the land on 31 August 2016, at a cost of RM10 million. After its completion, PB has commenced the manufacturing of hi-tech machinery for domestic and international markets on 1 October 2016. PSB’s financial year-end is on 30 September annually. As the business grows and is profitable, PB is embarked on business expansion. It has begun with the construction of a new factory building at a cost of RM4.5 million on the existing land whose completion date is expected no later than 30 June 2022. At the same time, PB plans to install new hi-tech machinery costing RM60 million by the end of July 2022 for the production to commence in early August 2022.

Required:

Determine whether PB qualifies for the reinvestment allowance by stating all the conditions to be fulfilled by the company.

Answer rating: 100% (QA)

RA is an incentive provided under the Act Schedule 7A to encourage reinvestment or continued investment by foreign and domestic investors hence the rather long 15year TRP RA shares similarities with I... View the full answer