KUALA LUMPUR (Dec 17): Selangor state-linked Kumpulan Perangsang Selangor Bhd (KL:KPS) has filed an appeal against a capital gains tax (CGT) assessment and penalty totalling RM7.9 million issued by the Inland Revenue Board (IRB).
The notice, dated Nov 29, was served to KPS’ wholly owned subsidiary, Bold Approach Sdn Bhd (BASB) on Dec 12, regarding proceeds from the divestment of Kaiserkorp Corp Sdn Bhd, KPS told Bursa Malaysia.
According to the assessment under Section 90(3) of the Income Tax Act 1967, IRB imposed a 2% CGT on the gross consideration of RM271.95 million, resulting in a tax amount of RM5.44 million. Additionally, a 45% penalty for non-filing was applied to the CGT, amounting to RM2.45 million.
According to KPS, the total RM7.9 million must be settled within 30 days, by Dec 28.
KPS said it believes there are reasonable grounds to seek the cancellation of the CGT assessment and the penalty, based on advice from its tax agent and solicitor.
The disposal of Kaiserkorp shares on Jan 9, 2024, falls within the exemption period from Jan 1, 2024, to Feb 29, 2024, as outlined in the Income Tax (Exemption) (No. 7) Order 2023, KPS argued.
Under this order, KPS said CGT on such disposals is exempted, it said.
“Thus, BASB is not required to submit a CGT return.
“BASB has submitted an appeal against the notice of assessment for the CGT and the penalty, in accordance with the provisions of the Income Tax Act 1967, on 17 December 2024,” the group added.
KPS in March completed the divestment of a 50% stake in Kaiserkorp Corp to AI Dream (HK) Ltd for a cash consideration of US$57.46 million. AI Dream is wholly owned by AI Dream 3 (Cayman) Ltd.
The transaction reduced KPS’ shareholding in Kaiserkorp to 10%, down from 60% previously.
Kaiserkorp wholly owns King Koil Licensing Co Inc, the US-based owner of the King Koil mattress brand.
KPS acquired the 60% stake in Kaiserkorp for US$28.8 million back in May 2016.
KPS’ share price closed up half a sen or 0.76% at 66 sen on Tuesday, giving the group a market capitalisation of RM352 million.