New Tax Rules Ease Burden on Contractors, Align with Industry Practices

KUALA LUMPUR – The government has revised tax treatment for construction contracts, now allowing profit or loss recognition based on final accounts or 12 months after project completion — whichever is earlier. Previously, recognition was tied to the Certificate of Practical Completion (CPC), which often excluded unresolved financial matters. The Master Builders Association Malaysia (MBAM), with support from the Finance Ministry, IRBM, and industry bodies, pushed for this change through the Pemudah taskforce. The move improves tax accuracy, eases cash flow, and reduces business risks, aligning regulations with real-world practices and supporting the Ekonomi Madani framework.

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