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Transfer Pricing Documentation Expenses Are Now Tax Deductible !

Posted LnCoadmin

For businesses involved in Related Party Transactions, preparing For businesses involved in Related Party Transactions, preparing Transfer Pricing Documentation (TPD) is an essential part of tax compliance. While businesses have traditionally incurred costs to prepare these documents, there is now good news — these expenses may qualify for a tax deduction.) is an essential part of tax compliance. While businesses have traditionally incurred costs to prepare these documents, there is now good news — these expenses may qualify for a tax deduction.

 

The Inland Revenue Board of Malaysia (HASiL) has confirmed that expenses incurred for the preparation of Transfer Pricing Documentation may be eligible for a tax deduction under the Income Tax (Deduction for Expenditure Related to Environmental, Social and Governance) Rules 2025 [P.U.(A.) 193/2025], subject to the applicable conditions.

Which Transfer Pricing Documentation Qualifies?

The tax deduction applies to the preparation of:

  • Full Transfer Pricing Documentation
  • Minimum Transfer Pricing Documentation

Subject to the relevant requirements, professional fees and related costs incurred in preparing the above documentation may qualify for a tax deduction.

Applicable Years of Assessment

This tax deduction is available for:

✔ Year of Assessment (YA) 2024 to YA 2027

Businesses should retain all relevant supporting documents and records to facilitate their tax claims.

Which Businesses Should Take Note?？

Your business should pay particular attention if it is involved in any of the following related party transactions:

  • Transactions with local or overseas related companies
  • Intra-group services
  • Sale or purchase of goods within the group
  • Intercompany loans, financing or interest arrangements
  • Royalty, trademark or intellectual property transactions
  • Any other transactions subject to Malaysia’s Transfer Pricing Rules

If your company has Related Party Transactions, don’t miss this valuable tax incentive. It could help reduce your tax compliance costs while ensuring your business remains compliant.

****Last updated as 08.07.2026