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MOF > Home > Revenue > Tax Resources > Tax Amendments

Tax Amendments 

 

 

 

Income Tax Act (Amendment) Order, 2009

Income Tax (Automation Equipment) Rules, 2009

Income Tax Act (Amendment) Order, 2008

Income Tax Act (Amendment) (No. 2) Order, 2008

 
Note:

Copies of the gazetted Orders can be obtained from this address below:

Registrar of Companies
The Attorney General's Chambers
The Law Building, Km 1, Jln Tutong
Bandar Seri Begawan, BA 1910

Tel: +6732244872

Fax: +6732223100

E-mail:   info@agc.gov.bn

    

INCOME TAX ACT (AMENDMENT) ORDER, 2009

In exercise of the power conferred by Article 83(3) of the Constitution of Brunei Darussalam, His Majesty the Sultan and Yang Di-Pertuan hereby makes the following Order –

Citation.

1.       This Order may be cited as the Income Tax Act (Amendment) Order, 2009. 

Amendment of section 3 of Chapter 35.

2.       Section 3 of the Income Tax Act, in this Order referred to as the Act, is amended by adding the following new subsection –

“(5)    No action shall be brought against the Collector, any authorised officer or any other person acting under the direction of the Collector in respect of any act or thing done or omitted to be done by him in good faith in the exercise, performance or purported exercise or performance, of any powers or duties under this Act.”.

Insertion of new section 6A.

3.       The Act is amended by inserting the following new section immediately after section 6 – 

“Electronic service.

6A.     (1)      The Collector may provide an electronic service for –

(a)      the filing or submission of any return, estimate, statement or document; or

(b)      the service of any notice by the Collector.

(2)      For the purposes of the electronic service, the Collector may assign to any person –

(a)      an authentication code; and

(b)      an account with the electronic service.

(3)      Any person who is required to file or submit any return, estimate, statement or document may do so through the electronic service.

(4)      Any agent who is authorised by his principal in the prescribed manner may file or submit any return, estimate, statement or document on behalf of his principal through the electronic service.

(5)      Where any return, estimate, statement or document is filed or submitted on behalf of any person under subsection (4) –

(a)      it shall be deemed to have been filed or submitted with the authority of that person; and

(b)      that person shall be deemed to be cognisant of all matters therein.

(6)      Where any return, estimate, statement or document is filed or submitted through the electronic service using the authentication code assigned to any person before that person has requested, in the prescribed manner, for the cancellation of the authentication code –

(a)      the return, estimate, statement or document shall, for the purposes of this Act, be presumed to have been filed or submitted by that person unless he adduces evidence to the contrary; and

(b)      where that person alleges that he did not file or submit the return, estimate, statement or document, the burden shall be on him to adduce evidence of that fact.

(7)      Where any person has given his consent for any notice to be served on him through the electronic service, the Collector may serve the notice on that person by transmitting an electronic record of the notice to that person’s account with the electronic service.

(8)      Notwithstanding any other written law, in any proceedings under this
Act –

(a)      an electronic record of any return, estimate, statement or document that was filed or submitted, or any notice that was served, through the electronic service; or

(b)      any copy or print-out of that electronic record,

shall be admissible as evidence of the facts stated or contained therein if that electronic record, copy or print-out –

(i)       is certified by the Collector to contain all or any information filed, submitted or served through the electronic service in accordance with this section; and

(ii)      is duly authenticated in the manner specified in subsection (10) or is otherwise authenticated in the manner provided in the Evidence Act (Chapter 108) for the authentication of computer output.

(9)      For the avoidance of doubt –

(a)      an electronic record of any return, estimate, statement or document that was filed or submitted, or any notice that was served, through the electronic service; or

(b)      any copy or print-out of that electronic record,

shall not be inadmissible in evidence merely because the return, estimate, statement or document was filed or submitted, or the notice was served, without the delivery of any equivalent document or counterpart in paper form.

(10)    For the purposes of this section, a certificate –

(a)      giving the particulars of –

(i)       any person whose authentication code was used to file, submit or serve the return, estimate, statement, document or notice; and

(ii)      any person or device involved in the production or transmission of the electronic record of the return, estimate, statement, document or notice, or the copy or print-out thereof;

(b)      identifying the nature of the electronic record or copy thereof; and

(c)      purporting to be signed by the Collector or by a person occupying a responsible position in relation to the operation of the electronic service at the relevant time,

shall be sufficient evidence that the electronic record, copy or print-out has been duly authenticated, unless the court calls for further evidence on this issue.

(11)    Where the electronic record of any return, estimate, statement, document or notice, or a copy or print-out of that electronic record, is admissible under subsection (8), it shall be presumed, until the contrary is proved, that the electronic record, copy or print-out accurately reproduces the contents of that document.

(12)    The Collector may, for the purposes of the electronic service, approve the use of any symbol, code, abbreviation or notation to represent any particulars or information required under this Act.

(13)    The Minister may, with the approval of His Majesty the Sultan and Yang Di-Pertuan, make regulations which are necessary or expedient for carrying out the purposes of this section, including regulations prescribing –

(a)      the procedure for the use of the electronic service, including the procedure in circumstances where there is a breakdown or interruption of the electronic service;

(b)      the procedure for the correction of errors in, or the amendment of, any return, estimate, statement or document that is filed or submitted through the electronic service;

(c)      the manner in which a person who has given his consent for a notice to be served on him through the electronic service shall be notified of the transmission of an electronic record of the notice to his account with the electronic service;

(d)      the manner in which authentication codes are to be assigned; and

(e)      anything which may be prescribed under this section.”.

 

Insertion of new section 11E.

4.       The Act is amended by inserting the following new section immediately after
section 11D –

“Further deduction for contribution to Tabung Amanah Pekerja.

11E.   Where the Collector is satisfied that an employer has made a contribution to the Tabung Amanah Pekerja (Employee Trust Fund) established under section 6 of the Tabung Amanah Pekerja Act (Chapter 167) in respect of any of his employees, there shall be allowed to the employer a further deduction of the amount of that contribution in addition to the deduction allowed under section 11.”. 

Amendment of section 16.

5.       Section 16(1) of the Act is amended –

(a)      by deleting “one-fifth” from the sixth line and by substituting “40%” therefor;

(b)      by deleting “1946” from the ninth line and by substituting “2009” therefor.

Insertion of new section 16B.

6.       The Act is amended by inserting the following new section immediately after
section 16A –

“Allowances of 3 years write-off for machinery and plant, and 100% write-off for computer, prescribed office automation equipment etc.

16B.   (1)      Notwithstanding section 16, where a person carrying on a trade, profession or business incurs capital expenditure on the provision of machinery or plant for the purposes of that trade, profession or business, he shall, in lieu of the allowances provided by section 16, be entitled for a period of 3 years to an annual allowance of 33⅓% in respect of the capital expenditure incurred.

(2)      Notwithstanding section 16, where a person proves to the satisfaction of the Collector that he has installed a computer or other prescribed automation equipment for the purposes of a trade, business or profession carried on by him, he shall, in lieu of the allowances provided by subsection (1) or section 16, be entitled, if he so elects, to an allowance of 100% in respect of the capital expenditure incurred on the provision of that computer or automation equipment.

(3)      Notwithstanding section 16 and subject to subsection (4), where a person proves to the satisfaction of the Collector that he has incurred capital expenditure not exceeding $2,000 on the provision of any item of machinery or plant for the purposes of a trade, profession or business carried on by him, he shall, in lieu of the allowances provided by subsection (1) or section 16, be entitled, if he so elects, to an allowance of –

(a)      100% in respect of that capital expenditure; or

(b)      where allowances have been made under subsection (1) or section 16 for any previous year of assessment under subsection (4), the amount of that capital expenditure still unallowed.

(4)      The aggregate amount of allowances claimed by any person under subsection (3) for any year of assessment shall not exceed $30,000; and allowances may be made under subsection (1) or section 16 in respect of any capital expenditure still unallowed.

(5)      No allowance shall be made under subsection (3) in respect of any item of machinery or plant which is acquired under a hire-purchase agreement and the original cost of that item of machinery or plant exceeds $2,000.

(6)      Any claim by a person for allowances in respect of any machinery or plant under this section for any year of assessment shall not be disallowed by reason only that the person has not in use the machinery or plant at the end of the basis period for that year of assessment.

(7)      Any claim for allowances under this section shall be made at the time of lodgment of the return of income for the relevant years of assessment or within such further time as the Collector may allow.

(8)      Where any allowance has been claimed and allowed under this section for any year of assessment, no allowances shall be made in any subsequent year of assessment under section 16 in respect of such expenditure.

(9)      Subject to subsection (3), where any allowance has been claimed and allowed under section 16 in respect of any expenditure, no allowances shall, except with the approval of the Minister and subject to such conditions as he may impose, be made in any subsequent year of assessment under this section in respect of the amount of that expenditure remaining unallowed under section 16.

(10)    This section shall apply to any machinery or plant acquired on or after
1st January 2009.”.

Amendment of section 30.

7.       Section 30 of the Act is amended by inserting the following new subsection immediately after subsection (1) –

“(1A)   For the purposes of this section, unless otherwise provided in this Act or the Investment Incentives Order, 2001 (S 48/01), where a company whose income, if any, is subject to tax at different rates of tax for any year of assessment, the Collector shall apportion any sum allowable among those different rates of tax on such basis as he considers reasonable.”.

Amendment of section 35.

8.       Section 35 of the Act is amended –

(a)      in subsection (1) –

(i)       in paragraph (b) –

(A)     by deleting “and subsequent years of assessment” from the first and second lines;

(B)     by deleting the comma and by substituting a semicolon therefor;

(ii)      by adding the following new paragraph –

“(c)     the year of assessment 2010 and subsequent years of assessment upon the chargeable income of every company, tax at the rate of 23.5%,”;

(b)      in subsection (2)(b), by deleting “, (b) and (d)” from the first line and by substituting “and (b)” therefor;

(c)      by inserting the following new subsection immediately after subsection (2) –

“(2A)   Notwithstanding anything in this Act, tax at the rate of 10% shall be levied and paid on the gross amount of any income referred to in section 9(5)(d) accruing in or derived from Brunei Darussalam on or after 1st January 2009 by any person from any trade, business, profession or vocation carried on or exercised by him in Brunei Darussalam and which is not effectively connected with any permanent establishment in Brunei Darussalam of that person.”;

(d)      by inserting the following 2 new subsections immediately after subsection (6) –

“(6A)   The rate of tax under subsection (1)(c) shall not apply to any part of the chargeable income of any company which is attributable to the income derived by the company on or before 1st January 2009 and the rate of tax under subsections (1)(a) or (b), as the case may be, shall apply to such part of the chargeable income of the company.

(6B)    For the purposes of subsection (6A), without prejudice to section 28, the Collector may make such adjustments as he considers appropriate, including the computation or re-computation of gains or profits of any company, so as to give effect to that subsection.”.

Amendment of section 37A.

9.       Section 37A of the Act is amended by adding “, and the reference to 20 per cent in the fourth line of section 37(1) shall be construed as a reference to the rate specified in sections 35(2), (2A) or (3), as the case may be”.

Amendment of section 52.

10.     Section 52 of the Act is amended –

(a)      by inserting “(1)” immediately before “The” in the first line;

(b)      by inserting “or such extended time as the Collector may allow” immediately after “time” in the third line;

(c)      by adding the following 2 new subsections –

“(2)    The Collector may, in any notice made under subsection (1), exempt from liability to furnish returns such class of persons not liable to pay tax as he thinks fit, and any person so exempted need not furnish a return under that subsection unless he is required by the Collector to do so under subsection (3).

(3)      Notwithstanding subsection (1), the Collector may, by notice in writing, require any person to furnish to him in such form and manner and within such reasonable time as he may determine, with a return of income and such particulars as may be required for the purpose of ascertaining the income, if any, for which such person is chargeable under this Act.”.

Insertion of new section 52A.

11.     The Act is amended by inserting the following new section immediately after
section 52 –

“Furnishing of estimate of chargeable income if no return is made under section 52.

52A.   (1)      Every person carrying on or exercising any trade, business, profession or vocation who has not made a return under section 52 for any year of assessment shall, within 3 months after the end of the accounting period relating to that year of assessment, furnish to the Collector an estimate of his chargeable income.

 

(2)      Any person who fails or neglects without reasonable excuse to furnish the estimate of his chargeable income as required under subsection (1) shall be guilty of an offence.”.

Insertion of new section 55C.

12.     The Act is amended by inserting the following new section immediately after
section 55B –

“Failure to comply with notices issued by Collector.

55C.   Notwithstanding section 78, any person who fails or neglects without reasonable excuse to comply with any notice issued by the Collector under sections 54, 55, 55A or 55B shall be guilty of an offence.”.

Amendment of section 60.

13.     Section 60 of the Act is amended by adding the following new subsection –

“(3)    If a return in relation to the partnership for any year of assessment has not been made, the person required to make the return under subsections (1) or (2), as the case may be, shall, within 3 months after the end of the accounting period relating to that year of assessment, furnish to the Collector an estimate of the income from all sources of the partnership, and the names and identification numbers of all the partners together with the amount of the share of the income to which each partner was entitled for that year.”.

Amendment of section 62.

14.     Section 62 of the Act is amended –

(a)      by inserting “(1)” immediately before “Where” in the first line;

(b)      by adding the following 2 new subsections –

“(2)    Notwithstanding subsection (1), where, in the opinion of the Collector, any form of fraud or wilful default has been committed by or on behalf of any person in connection with or in relation to tax, he may, for the purpose of making good any loss of tax attributable to fraud or wilful default, assess that person at any time.

(3)      This section shall also apply, with the necessary modifications, to any assessment made under subsections (1) or (2) which results in any unabsorbed allowances or losses.”.

Amendment of section 70.

15.     Section 70 of the Act is amended –

(a)      by inserting “(1)” immediately before “Subject” in the first line;

(b)      by deleting the colon from the fifth line and by substituting a fullstop therefor;

(c)      by deleting the proviso;

(d)      by adding the following new subsection –

“(2)    The Collector may, in his discretion and subject to such terms and conditions, including the imposition of interest, as he may impose, extend the time limit within which payment is to be made.”.

Amendment of section 76.

16.     Section 76 of the Act is amended, in subsection (2), by deleting “His Majesty the Sultan and Yang Di-Pertuan in Council” from the first line and by substituting “The Minister, with the approval of His Majesty the Sultan and Yang Di-Pertuan,” therefor.

Amendment of section 77A.

17.     Section 77A of the Act is amended –

(a)      by inserting “(1)” immediately before “Every” in the first line;

(b)      by adding the following new subsection –

“(2)    Any notice or process given or served upon any person by posting the same or a copy thereof by registered post to him at his last known address shall, notwithstanding section 6(3), be deemed to have been duly given or served and shall be conclusive evidence of the fact of service.”.

Amendment of section 78.

18.     Section 78 of the Act is amended by adding the following 2 new subsections –

“(4)    Where any person has been convicted of an offence under section 55C and such conviction is a second or subsequent conviction in respect of the same information required for the same period, he shall be liable to a further penalty of $50 for every day during which the offence continues after such conviction.

(5)      Where any person has been convicted of an offence for failing to comply with any provision of sections 52 or 60 and such conviction is a second or subsequent conviction in respect of the same year of assessment, he shall be liable to a further penalty of $50 for every day during which the offence continues after such conviction.”.

Amendment of section 79.

19.     Section 79 of the Act is amended by inserting the following new subsection immediately after subsection (1) –

“(2)    Every person who without reasonable excuse or through negligence –

(a)      makes an incorrect return by omitting or understating any income of which he is required by this Act to make a return; or

(b)      gives any incorrect information in relation to any matter affecting his own liability to tax or the liability of any other person or of a partnership,

shall be guilty of an offence for which, on conviction, he shall pay a penalty equal to double the amount of tax which has been undercharged in consequence of such incorrect return or information, or which would have been so undercharged if the return or information had been accepted as correct, and shall also be liable to a fine not exceeding $5,000, imprisonment for a term not exceeding 12 months or both.”. 

Amendment of section 80.

20.     Section 80 of the Act is amended by inserting the following new subsection immediately after subsection (2) –

“(2A)   Where an individual has been convicted of –

(a)      3 or more offences under this section; or

(b)      one offence under this section and one offence under section 80A,

the imprisonment he shall be liable to shall not be less than 6 months.”.

Insertion of new section 80A.

21.     The Act is amended by inserting the following new section immediately after
section 80 –

“Serious fraudulent tax evasion.

80A.   (1)      Any person who wilfully with intent to evade or to assist any other person to evade tax –

(a)      prepares or maintains or authorises the preparation or maintenance of any false books of account or other records or falsifies or authorises the falsification of any books of account or records; or

(b)      makes use of any fraud, art or contrivance or authorises the use of any such fraud, art or contrivance,

shall be guilty of an offence for which, on conviction, he shall pay a penalty of 4 times the amount of tax which has been undercharged in consequence of the offence or which would have been undercharged if the offence had not been detected, and shall also be liable to a fine not exceeding $50,000, imprisonment for a term not exceeding 5 years or both.

(2)      Where an individual has been convicted of –

(a)      2 or more offences under this section; or

(b)      one offence under this section and one offence under section 80,

the imprisonment he shall be liable to shall not be less than 6 months.

(3)      Where in any proceedings under this section it is proved that any false statement or entry is made in any books of account or other records maintained by or on behalf of any person, that person shall be presumed, until the contrary is proved, to have made that false statement or entry with intent to evade tax.

(4)      The Collector may compound any offence under this section and may before judgment stay or compound any proceedings thereunder.”.

Substitution of section 84.

22.     The Act is amended by repealing section 84 and by substituting the following new section therefor –

“Jurisdiction of courts.

84.     Notwithstanding any provision to the contrary in the Criminal Procedure Code (Chapter 7) or in any other written law, a Court of a Magistrate shall have jurisdiction to try any offence under this Act and shall have power to impose the full penalty or punishment in respect of that offence.”.

 

INCOME TAX (AUTOMATION EQUIPMENT) RULES, 2009

In exercise of the power conferred by section 5(1) of the Income Tax Act, the Minister of Finance, with the approval of His Majesty the Sultan and Yang Di-Pertuan, hereby makes the following Rules –

Citation and commencement.

1. These Rules may be cited as the Income Tax (Automation Equipment) Rules, 2009 and shall commence on the same date as the Income Tax Act (Amendment) Order, 2009.

Automation equipment.

2. The automation equipment specified in the Schedule is hereby prescribed for the purposes of the allowances to be made under section 16B(2).

                                                                                    SCHEDULE                                                                     (rule 2) 

AUTOMATION EQUIPMENT

1.         Image or graphics processing equipment, including facsimile, optical character reader, laser printer, plotter, image setter, digital printing and direct imaging equipment.

2.         Data processing equipment, including mainframe, minicomputer, microcomputer and peripherals.

3.         Data communications equipment, including modem, multiplexor, network processor, interface converter, routers and switches.

4.         Office system software, including software used in connection with provision of any office automation service.

5.         Computer-aided design system software and computer-aided manufacturing system software.

6.         Surface mount technology machine which is used for the automatic assembly of surface mount devices onto printed circuit boards.

7.         Computer controlled machine for cutting and removal operations with automatic tool change capabilities, including CNC lathes, milling machines, EDM wirecut, machining centers, grinders, presses and laser equipment.

8.         Unmanned automated guided vehicle which is reprogrammable and used for the transfer of goods or materials within a factory or an office.

9.         Co-ordinate measuring machine which is controlled by computer and used for the precise measurement of components for industrial, research or training purposes, including auto in-line vision inspection system and automated testing equipment.

10.      Automated machine for the storage and retrieval of goods or materials which is controlled by computer and installed with automatic retrieval devices.

11.      Flexible manufacturing cells consisting of an integrated manufacturing system comprising at least a computer controlled machine and a robot, including assembly robots, robotic systems and auto-packing lines.

12.      Automated warehousing equipment and software, including Integrated Transport Fleet Management System, Integrated Warehouse Management System (Radio Frequency Terminals) and Very Narrow Aisle (VNA), automatic material handling, collating and binding equipment, Enterprise Resource Planning systems and Materials Resource Planning and Manufacturer Resource Planning software systems.

13.      Automated inspection, testing, packaging and control system for chemicals, pharmaceuticals, medical devices and other automated manufacturing, including high speed tabletting machines, high speed packaging machines, such as for blister packaging, infra-red probe for control and inspection, vision devices to check mould function or parts inspection, in-mould transfer parts sorting system and analysis equipment for quality control and assurance.

14.      Injection mould machines used for making plastic, ceramic or metal components in factory production.

15.      Automated chemicals handling equipment, system or line.

16.      Computer-to-plate and computer-to-press systems used in drafting and printing business.

17.      Automated machinery and systems for food processing and packaging or food preservation.

18.      Semiconductor Production Machine used in the manufacture of semiconductor wafers or packaged ICs.

19.      Automatic photonics assembly and test equipment.

20.      Automated equipment used in port-related operations.

 

 




INCOME TAX ACT (AMENDMENT) ORDER, 2008

 

 

In exercise of the power conferred by Article 83(3) of the Constitution of Brunei Darussalam, His Majesty the Sultan and Yang Di-Pertuan hereby makes the following Order –

 

Citation and commencement.

1.       This Order may be cited as the Income Tax Act (Amendment) Order, 2008 and shall be deemed to have commenced on 1st January 2008.

 

Amendment of section 2 of Chapter 35.

2.       Section 2 of the Income Tax Act, in this Order referred to as the Act, is amended by deleting the definition of "resident in Brunei Darussalam," and by substituting the following new definition therefor -

“ "resident in Brunei Darussalam" -

(a)      in relation to an individual, means a person who, in the year preceding the year of assessment, resides in Brunei Darussalam except for such temporary absences therefrom as to the Collector may consider reasonable and not inconsistent with a claim by such person to be resident in Brunei Darussalam, and includes a person who is physically present or who exercises an employment (other than as a director of a company) in Brunei Darussalam for 183 days or more during the year preceding the year of assessment;

(b)      in relation to a company or a body of persons, means a company or a body of persons the control and management of whose business is exercised in Brunei Darussalam;”.

 

Insertion of new section 5A.

3.       The Act is amended by inserting the following new section immediately after section 5 -

"Identification of officers.

5A.     (1)      Any person exercising any functions under this Act shall carry an authority card in a form approved by the Collector which shall identify the holder and his office and which shall be produced by the holder on demand to any person having reasonable grounds to make that demand.

 

(2)      Where any person exercising any functions under this Act produces an authority card in a form approved under subsection (1) or any other written identification or authority, then, until the contrary is proved, that authority card or other identification or authority shall be presumed to be genuine and he shall be presumed to be the person referred to therein.

 

(3)      It shall not be an offence for any person to refuse to comply with any demand or order made by any person exercising any functions under this Act, if such latter person refuses on demand being made by such first-mentioned person to declare his office and to produce his authority card or other written identification or authority.".

 

Amendment of section 9.

4.       Section 9 of the Act is amended by adding the following 2 new subsections –

          "(4)    There shall be deemed to be derived from Brunei Darussalam -

(a)      any interest, commission, fee or other payment in connection with any loan or indebtedness or with any arrangement, management, guarantee or service relating to any loan or indebtedness which is -

(i)       borne, directly or indirectly, by a person resident in Brunei Darussalam or having a permanent establishment in Brunei Darussalam (except in respect of any business carried on outside Brunei Darussalam through a permanent establishment outside Brunei Darussalam) or any immovable property situated outside Brunei Darussalam; or

(ii)      deductible against any income accruing in or derived from Brunei Darussalam; or

(b)      any income derived from loans where the funds provided by such loans are brought into or used in Brunei Darussalam.

 

(5)      There shall be deemed to be derived from Brunei Darussalam -

(a)      royalties or other payments in one lump sum or otherwise for the use of or the right to use any movable property;

(b)      any payment for the use of or the right to use scientific, technical, industrial or commercial knowledge or information or for the rendering of assistance or services in connection with the application or use of such knowledge or information;

(c)      any payment for the management or assistance in the management of any trade, business or profession; or

(d)      rent or other payments under any agreement or arrangement for the use of any movable property,

which are borne, directly or indirectly, by a person resident in Brunei Darussalam or having a permanent establishment in Brunei Darussalam (except in respect of any business carried on outside Brunei Darussalam through a permanent establishment outside Brunei Darussalam) or which are deductible against any income accruing in or derived from Brunei Darussalam.".

 

Amendment of section 11.

5.       Section 11 of the Act is amended -

(a)      in subsection (1), by inserting the following new paragraph immediately after paragraph (f) -

"(fa)   zakat, fitrah or any religious dues, payment of which is made under any written law;".

(b)              by inserting the following new subsection immediately after subsection (1) –

"(1A)   Notwithstanding subsection (1), where outgoings and expenses falling within that subsection are incurred, whether directly or in the form of reimbursements, in respect of a motor car (whether or not owned by the person incurring the outgoings and expenses), the sum to be allowed as a deduction shall be limited to the amount which bears to such outgoings and expenses the same proportion as $50,000 bears to the capital expenditure incurred by the owner in respect of that motor car, where such capital expenditure exceeds $50,000.".

 

Amendment of section 16.

6.                 Section 16 of the Act is amended by adding the following 2 new subsections –

"(4)    Notwithstanding subsections (1) and (2), in respect of a motor car to which this subsection applies -

(a)      the initial allowance to be made under subsection (1) shall be calculated on an amount equal to the capital expenditure incurred in respect of that motor car or $50,000, whichever is the less;

(b)      the annual allowance to be made under subsection (2) shall be calculated on the basis that the original cost of that motor car is the capital expenditure incurred or $50,000, whichever is the less;

(c)      the aggregate of the initial and annual allowances to be made under this subsection for all the relevant years of assessment shall not exceed $50,000.

(5)      Subsection (4) shall apply to a motor car which is constructed or adapted for the carriage of not more than 7 passengers (exclusive of the driver) and the weight of which unladen does not exceed 3,000 kilograms.".

 

Substitution of section 37.

7.       Section 37 of the Act is repealed and substituted by the following new section -

"Witholding of tax in respect of interest paid to non-resident persons.

37.        (1)  Where any person is liable to pay to another person not known to him to be resident in Brunei Darussalam any interest which is chargeable to tax under this Act, the person paying the interest shall deduct therefrom tax at the rate of 20 per cent on every dollar of the interest, and shall immediately give notice of the deduction of tax in writing and pay to the Collector the amount so deducted and every such amount shall be a debt due from him to the Government and shall be recoverable as such.

 

(2)    The Collector may, if he thinks fit, allow any bank or financial institution to give notice of the deduction of tax and make payment of the amount so deducted within such other period and subject to such conditions as he may determine.

 

(3)    Where a person fails to make a deduction of tax which he is required to make under subsection (1), any amount which he fails to deduct shall be a debt due from him to the Government and shall be recoverable as such.

 

(4)    If the amount of tax which is required to be deducted under subsection (1) is not paid to the Collector -

(a) within 14 days after the payment of the interest from which the tax is to be deducted, a sum equal to 5 per cent of such amount of tax shall be payable; and

(b) within 30 days after the payment of the interest from which the tax is to be deducted, an additional penalty of one per cent of such amount of tax shall be payable for each completed month that the tax remains unpaid, but the total additional penalty under this paragraph shall not exceed 15 per cent of the amount of tax outstanding.

 

(5)    Without prejudice to any other provision of this Act, if any person after deducting the tax required to be deducted under subsection (1) fails to give notice of such deduction to the Collector within 14 days after such deduction, he shall be guilty of an offence and shall on conviction be liable to a penalty equal to 3 times the amount of tax so deducted and shall also be liable to a fine not exceeding $10,000, imprisonment for a term not exceeding 3 years or both.

 

(6)    The Collector may -

(a)  compound any offence under subsection (5) and may before judgment stay or compound any proceedings thereunder; and

(b)  for any good cause remit the whole or any part of the penalty
payable under subsection (4)(b).

 

(7)    For the purposes of this section -

(a)  the manager or principal officer of a company shall be answerable for doing all such acts, matters and things as are required to be done by the company under this section; and

(b)  interest shall be deemed to have been paid by a person to another person although it is not actually paid to that other person but is reinvested, accumulated, capitalised, carried to any reserve or credited to any account however designated, or otherwise dealt with on behalf of that other person.".

 

Insertion of new sections 37A and 37B.

8.       The Act is amended by inserting the following 2 new sections immediately after
section 37 -

"Application of section 37 to royalties, management fees etc.

37A.    Section 37 shall apply in relation to the payment of any income referred to in sections 9(4) or (5) by any person to another person not known to him to be resident in Brunei Darussalam as those provisions apply to any interest paid by a person to another person not known to him to be resident in Brunei Darussalam, and for the purpose of such application, any reference in those provisions to interest shall be construed as a reference to the income referred to in sections 9(4) or (5).

 

Application of section 37 to non-resident director's remuneration.

37B.    Section 37 shall apply in relation to the payment of any remuneration by a company to any director of the company who is not resident in Brunei Darussalam as those provisions apply to any interest paid by a person to another person not known to him to be resident in Brunei Darussalam and, for the purpose of such application, any reference in those provisions to interest shall be construed as a reference to such remuneration.".

 

Amendment of section 55.

9.       Section 55 of the Act is amended -

(a)      by inserting "(1)" immediately before "For" in the first line;

(b)      by deleting "books, documents, accounts and returns" from the penultimate line and by substituting "documents" therefor;

(c)      by adding the following new subsection -

"(2)    In this section and for the purposes of section 55B –

"document" includes, in addition to a document in writing –

(a)      any map, plan, graph or drawing;

(b)      any photograph;

(c)      any label, marking or other writing which identifies or describes anything of which it forms a part, or to which it is attached by any means;

(d)      any disc, tape, sound-track or other device in which sounds or other data (not being visual images) are embodied so as to be capable (with or without the aid of some other equipment) of being reproduced therefrom;

(e)      any film (including microfilm), negative, disc, tape or other device in which one or more visual images are embodied so as to be capable (with or without the aid of some other equipment) of being reproduced therefrom; and

(f)      any paper or other material on which there are marks, impressions, figures, letters, symbols or perforations having a meaning for persons qualified to interpret them;

 

"writing" includes any mode of representing or reproducing words, figures, drawings or symbols in a visible form.".

 

Substitution of section 55B.

10.       Section 55B of the Act is repealed and the following new section substituted therefor -

"Power of Collector to access and to obtain information.

55B.    (1)      The Collector and any officer authorised by him in that behalf -

(a)      shall at all times have full and free access to all buildings, places, documents, computers, computer programs and computer software (whether installed in a computer or otherwise) for any of the purposes of this Act;

(b)      shall have access to any information, code or technology which has the capability of retransforming or unscrambling encrypted data contained or available to such computers into readable and comprehensive format or text for any of the purposes of this Act;

(c)      shall be entitled -

(i)                 without fee or reward, to inspect, copy or make extracts from any such document, computer, computer program, computer software or computer output;

(ii)               at any reasonable time to inspect and check the operation of any computer, device, apparatus or material which is or has been in use in connection with anything to which this section applies;

(d)      may take possession of any such document, computer, device, apparatus, material, computer program or computer software where in his opinion -

(i)                 the inspection, checking, copying thereof or extraction therefrom cannot reasonably be performed without taking possession;

(ii)      any such items may be interfered with or destroyed unless possession is taken; or

(iii)              any such items may be required as evidence in proceedings for an offence under this Act or in proceedings for the recovery of any tax or penalty, or in proceedings by way of an appeal against an assessment;

(e)      shall be entitled to require -

(i)                 the person by whom or on whose behalf the computer is or has been used, or any person having charge of or otherwise concerned with the operation of the computer, device, apparatus or material to provide the Collector or officer with such reasonable assistance as he may require for the purposes of this section;

(ii)               any person in possession of decryption information to grant him access to such decryption information necessary to decrypt data required for the purpose of this section.

 

(2)      No person shall by virtue of this section be obliged to disclose any particulars as to which he is under any statutory obligation to observe secrecy.

(3)                  The Collector may require any person to give orally or in writing, as may be required, all such information concerning his or any other person's income, assets or liabilities as may be required of him by the Collector for the purposes of this Act.

(4)                 In this section, “computer” and “computer output” have the same meanings as in the Computer Misuse Order, 2000 (S 65/00).”.

Insertion of new section 56A.

11.                                             The Act is amended by inserting the following new section immediately after
section 56 -

"Keeping of books of account and giving of receipts.

56A.    (1)      Subject to subsection (3), every person carrying on or exercising any trade, business, profession or vocation –

(a)              shall keep and retain in safe custody sufficient records for a period of 7 years from the year of assessment to which any income relates to enable his income and allowable deductions under this Act to be readily ascertained by the Collector or any officer authorised in that behalf by the Collector; and

(b)              shall issue a printed receipt serially numbered for every sum received in respect of goods sold or services performed in the course of or in connection with such trade, business, profession or vocation, and shall retain a duplicate of every such receipt.

          (2)      Where a machine is used for recording sales, a receipt may be dispensed with if the Collector is satisfied that -

(a)      such machine automatically records all sales made; and

(b)      the total of all sales made in each day is transferred at the end of the day to a record of sales.

(3)      The Collector may by notice in writing to any person carrying on or exercising any trade, business, profession or vocation, or by a notice published in the Gazette in respect of any class or description of any such person, prescribe -

(a)              the form of the records to be kept under subsection (1)(a), and the manner in which such records shall be kept and retained; and

(b)              the form of the receipts to be issued and the duplicates to be retained under subsection (1)(b), and the manner in which such receipts shall be issued and such duplicates shall be retained,

and every such person shall be bound to comply with such notice.

(4)      The Collector may waive all or any of the provisions of subsection (1) in respect of any person or records or any class or description of persons or records.

 

(5)      Any person who, without reasonable excuse, fails to comply with
subsection (1) is guilty of an offence.

 

(6)     In this section, "records" includes -

(a)              books of account recording receipts, payments, income and expenditure;

(b)              invoices, vouchers, receipts and such other documents as in the opinion of the Collector are necessary to verify the entries in any book of account; and

(c)               any records relating to any trade, business, profession or vocation.".

Amendment of section 65.

12.             Section 65 of the Act is amended, in subsection (2), by deleting "60" from the fourth line and by substituting "30" therefor.

Insertion of new section 77A.

13.             The Act is amended by inserting the following new section immediately after section 77 -

"Change of address.

77A.   Every person liable to pay income tax under the provisions of this Act shall inform the Collector by notice in writing of any change of address.".

Amendment of section 78.

14.             Section 78 of the Act is amended -

(a)              in subsection (1)(a), by inserting "section 55B," immediately after ", section 55A," in the fourth line;

(b)              by adding the following new subsection -

                   "(3)    The Collector may compound any offence under this section, and may before judgment stay or compound any proceedings thereunder.".




INCOME TAX ACT (AMENDMENT) (No. 2) ORDER, 2008

 

In exercise of the power conferred by Article 83(3) of the Constitution of Brunei Darussalam, His Majesty the Sultan and Yang Di-Pertuan hereby makes the following Order -

Citation and commencement.

1.               This Order may be cited as the Income Tax Act (Amendment) (No. 2) Order, 2008 and shall be deemed to have commenced on 1st January 2008.

Amendment of section 13 of Chapter 35.

2.                 Section 13 of the Income Tax Act, in this Order referred to as the Act, is amended -

(a)                   in subsection (1) -

(i)                   by deleting "one-tenth" from the seventh line and by substituting "one-fifth" therefor;

(ii)                  by deleting "1946" from the ninth line and by substituting "2008" therefor;

(b)                 in subsection (2), in paragraph (a), by deleting "one-fiftieth" from the penultimate line and by substituting "one twenty-fifth" therefor.

Amendment of section 15.

3.                    Section 15 of the Act is amended -

(a)       in subsection (1) -

(i)                   in paragraph (g), by deleting the comma which appears for the second time and by substituting "; or" therefor;

(ii)                  by adding the following paragraph -


 

"(h) for the purposes of the trade of hotel-keeping,";

(b)                 in subsection (2), by deleting ", hotel" from the fourth and from the fifth lines";

(c)                 in subsection (3), by deleting "one-fiftieth" from the third last line and by substituting "one twenty-fifth" therefor.

Substitution of section 35.

4.       Section 35 of the Act is repealed and the following new section substituted therefor -
"Rate of tax upon companies and others.

35.       (1)      There shall be levied and paid for -

(a)                 the year of assessment 2008 upon the chargeable income of every company, tax at the rate of 27.5%;

(b)                 the year of assessment 2009 and subsequent years of assessment upon the chargeable income of every company, tax at the rate of 25.5%,

on every dollar of the chargeable income thereof.

(2)                 Notwithstanding anything in this Act but subject to subsection (3), tax at the rate of 15% shall be levied and paid on the gross amount of -

(a)                 any income referred to in section 9(4); and

(b)                 any income referred to in sections 9(5)(a), (b) and (d) but excluding the incomes specified in subsection (6),

accruing in or derived from Brunei Darussalam on or after 1st January 2008 by a person not resident in Brunei Darussalam which is not derived by that person from any trade, business, profession or vocation carried on or exercised by him in Brunei Darussalam and which is not effectively connected with any permanent establishment in Brunei Darussalam of the person.

(3)                 Notwithstanding anything in this Act, tax at the rate of 10% shall be levied and paid on the gross amount of any income referred to in sections 9(5)(a) and (b) but excluding the incomes specified in subsection (6), accruing in or derived from Brunei Darussalam on or after 1st January 2008 by a person not resident in Brunei Darussalam which is not derived by that person from any trade, business, profession or vocation carried on or exercised by him in Brunei Darussalam and which is not effectively connected with any permanent establishment in Brunei Darussalam of the person.

(4)                 Notwithstanding subsection (1) but subject to subsection (5), for the year of assessment 2008 and subsequent years of assessment, there shall be levied and paid for each year of assessment upon the chargeable income of every company tax at the rate prescribed in subsection (1) on every dollar of the chargeable income thereof except that  -

 

(a)                 for every dollar of the first $50,000 of the chargeable income (excluding Brunei Darussalam dividends), only 25% shall be charged with tax; and

(b)                 for every dollar of the next $50,000 of the chargeable income (excluding Brunei Darussalam dividends), only 50% shall be charged with tax.

        (5)                 Notwithstanding subsections (1) and (4), for each of the first 3 years of assessment falling within or after the year of assessment 2008, of a qualifying company there shall be levied and paid upon the chargeable income of the company tax at the rate prescribed in subsection (1) on every dollar of the chargeable income thereof except that every dollar of the first $100,000 of the chargeable income (excluding Brunei Darussalam dividends) shall be exempt from tax.

        (6)                 The incomes excluded under subsections (2)(b) and (3) are any payment to a person not resident in Brunei Darussalam for the rendering of assistance or service in connection with the application or use of scientific, technical, industrial or commercial knowledge or information.

         (7)              In this section -

"Brunei Darussalam dividends" means any dividend accruing in or derived from Brunei Darussalam from which tax is deducted or deductible under section 36;

"first 3 years of assessment", in relation to a qualifying company, means the year of assessment relating to the basis period during which the company  is  incorporated  or  registered in Brunei Darussalam and the 2 consecutive years of assessment immediately following that year of assessment;

"gross amount", in relation to any income referred to in subsections (2), (3) and (4), means the full amount of the income without any deduction and relief being allowed against the income under the provisions of this Act;

"qualifying company" means a company incorporated and registered in Brunei Darussalam (other than a company limited by guarantee) which for each of the first 3 years of assessment is resident in Brunei Darussalam for that year of assessment.".

 

 

 
 
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