Na’imah Seeks To Nullify RM313.82 Million Tax Assessment In Court

KUALA LUMPUR, Aug 26 (Bernama) -- The wife of former finance minister Tun Daim Zainuddin, Toh Puan Na’imah Abdul Khalid, has filed for a judicial review to nullify an income tax amounting to RM313.82 million imposed on her by the Inland Revenue Board (LHDN) in 2018.

The application was filed by Na'imah, 67, through the legal firm of Rosli Dahlan Saravana Partnership on Aug 19 at the Shah Alam High Court, naming the Director-General of Inland Revenue as the respondent.

Na'imah is challenging the Additional Assessment for the Year of Assessment 2018, totaling RM313,820,336.13, on the grounds that it is ultra vires and unlawful. She argues that the amount claimed by LHDN relates to three overseas assets that are beyond the respondent's jurisdiction, as Malaysia's income tax law operates on a territorial basis.

"The respondent has stated that regardless of where the income arises, as long as I am a Malaysian citizen and tax resident here, I am subject to tax audits related to all my sources of income and assets according to the Income Tax Act 1967 (ITA).

"The respondent has taken the entire market value of the three alleged assets, totalling RM700,572,811.00, as my unreported income in 2018 and has also requested that I prove the source of income used to acquire these assets," she claimed in the affidavit supporting the application.

Na'imah further stated that her lawyers have responded to the respondent, emphasising that the respondent lacked authority to investigate her assets located in foreign jurisdictions, particularly when no income derived from them accrues in Malaysia.

She claimed the respondent argued that they were empowered under Sections 78, 79, 80, and 81 of the ITA to obtain all necessary information and subsequently claimed that the sum of RM700,572,811.00 would be adjusted into her tax calculation for the Year of Assessment 2018 as unreported income.

According to Na'imah, the respondent asserted that Sections 80 and 81 of the ITA granted them the authority to request documents, and these documents must be reviewed to obtain evidence of her financial sources in acquiring the three foreign assets. However, she contends that these assets were purchased by her husband in the 1990s, and she no longer has access to the relevant documents, as the assets were acquired over 30 years ago.

However, she claimed that on Aug 13, 2024, the respondent issued an Additional Assessment Notice for the Year of Assessment 2018 amounting to RM313,820,336.13 against her.

Na’imah also noted that on Jan 18, the respondent questioned her regarding the increase in her shares in Ilham Baru Sdn Bhd and alleged that the three assets she used to settle loans between Ilham Baru, Ilham Tower Sdn Bhd, and Welberton Private Equity Corp were acquired using unreported income.

Na'imah is seeking a declaration that the ITA operates on a territorial basis and cannot be extended to compel taxpayers to provide information on foreign assets if no income from those assets is received in Malaysia.

The case management is scheduled for Sept 3 at the Shah Alam High Court.

-- BERNAMA