Sme Definition Paid Up Capital

3 definition by ministry of human resources.

Sme definition paid up capital. Simply the money injected into the firm by the shareholders in exchange for the shares purchased by them is called the paid up capital. The corporate tax rate for small and medium enterprises smes will be reduced to 17 this year from 18 previously according to prime minister tun dr mahathir mohamad noting the corporate tax rate as already competitive dr mahathir said this reduction in corporate tax will only be for smes with paid up capital of below rm2 5 million and businesses with annual. Paid up capital is money that a company receives from selling stock directly to investors. The independent evaluation study carried out in 2012 concluded that there is no need for a major revision of the sme definition.

The primary market is the only place where paid up capital is received usually through an initial public. The paid up capital refers to the amount that has been received by the company through the issue of shares to the shareholders. All statistics compiled prior to 2014 will remain status quo and will not be affected by the definition. Prior to the year of assessment 2009 special classes of sme refers to companies resident in malaysia which has a paid up capital in respect of ordinary shares of rm2 5mil and less at the beginning of the basis period for a year of assessment is given preferential tax treatment as spelt out in the relevant provisions of the act.

The commission monitors the implementation of the sme definition. The final report of the study 1 mb recommended to clarify the application of certain rules within the existing recommendation by providing guidance or by updating the 2005 edition of the sme. For the services and other sectors smes are defined as firms with sales turnover not exceeding rm20 million or number of full time employees not exceeding 75. Sme is defined as a company resident in malaysia which has a paid up capital of rm2 5 million or less and is not related to any company with paid up capital of more than rm2 5 million annual sales turnover not more than rm5 million.

The sme definition will come into effect as of 1 january 2014.