KUALA LUMPUR (Oct 10): UOA Development Bhd (KL:UOADEV) said its property investment unit has been served with a notice of additional assessment with penalty amounting to RM165.66 million relating to a gain from disposal of an asset.

The notice issued to Distinctive Acres Sdn Bhd on Friday concerned the gain from the disposal of UOA Corporate Tower in Bangsar South to UOA Real Estate Investment Trust (KL:UOAREIT) in 2020, said UOA Development in a filing to Bursa Malaysia.

The Inland Revenue Board has decided that the gain is subject to corporate income tax rather than real property gains tax, the company said.

“Based on advice from our tax consultant, the company has a strong basis to challenge the treatment and validity of the additional assessment,” UOA Development said.

It said it will file a notice of appeal within 30 days, adding that there will be no immediate financial impact pending the outcome of the appeal.

Earlier this month, UOA Development said it will transfer another three properties, located in UOA Business Park near Subang Jaya, to UOA REIT for RM200 million.

The transaction, slated for completion in the fourth quarter of 2025, is expected to yield a net disposal gain of RM35.8 million. Proceeds will be used to pare down debt, support working capital and fund the development of a new commercial building adjacent to UOA Business Park.

UOA Development’s shares closed unchanged at RM1.84, valuing the company at RM4.89 billion. UOA REIT also ended flat at 84.5 sen, giving it a market capitalisation of RM570.9 million.