Magnum hit with RM476.5mil claims from the taxman

A Magnum 4d outlet at Section 17, PJ. Magnum Corp is a subsidiary of Multi-Purpose Holdings Bhd (MPHB).

KUALA LUMPUR: Magnum Bhd and its unit Magnum Holdings Sdn Bhd (MHSB) have been served with notices of assessment with penalty from the Inland Revenue Board (IRB) totalling RM476.47mil.

In a filing with Bursa Malaysia, the numbers forecasting lottery operator said the Director General of Inland Revenue (DGIR) ordered Magnum to pay RM22.71mil for years of assessment 2008 and 2011-2015.

MHSB, meanwhile, was ordered to pay RM453.75mil.

The notices of assessment came about for several reasons.

Among them is that IRB has disallowed MHSB’s deduction of interest expenses and loan stock interest expenses incurred during the said years of assessment for the selective capital repayment exercise and privatisation of Magnum Corp Sdn Bhd in 2008 (then known as Magnum Corp Bhd).

Further, the notices of assessment for the years of assessment 2008, 2009, 2010 and 2011 were issued out of the prescribed time frame under law, Magnum said.

The IRB has also disallowed Magnum’s deduction of interest expenses for investments.

“Upon consulting its solicitors, the board is of the view that there are reasonable grounds to challenge the validity of the notices of assessment raised by the DGIR and the penalty imposed,” Magnum said.

It added that there would not be any imminent financial effects on the group as it was seeking to secure a stand over of payment pending the resolution of this matter.

* See also Magnum’s Q1 earnings fall, no dividend proposed