Youth Football Academy Red Star in orbit after scoring tax exemption for sponsors, thanks to MOF
N. Rada Krishnan, a renowned grassroots football coach who runs Youth Football Academy (YFA) Red Star, can finally heave a sigh of relief.
Malaysia’s Finance Ministry said it will grant the club tax reliefs for sponsorships of up to RM500,000 between Jan 1, 2024, and Dec 31, 2026, under Section 44(11B) of the Income Tax Act.
The Section provides that for a gift of money for any sports activity approved by the minister, or to any sports body approved by the Commissioner of Sports appointed under the Sports Development Act 1997, the amount paid, together with the amounts deducted under sub-Sections 6 and 11C, is restricted to a maximum deduction of 10 per cent of the aggregate income.
In its Nov 27 letter, the ministry also outlined the conditions set for the tax exemption, including that the sponsorship money, is strictly for YFA Red Star’s sporting activities, and that the sponsorship is only in cash.
“This is great news and we can’t thank the Finance Ministry enough for granting us the tax exemption,” said Rada Krishnan.
“We have passed this letter to CIMB Bank Bhd. They have been supporting us for many years and we look forward to their continued support.”
YFA Red Star was supported by CIMB Bank Bhd from 2008 to 2019. With a sponsorship of some RM200,000 annually, the academy was able to produce a string of talents, including national footballer Kogileswaran Raj.
“More importantly, the money will allow us to help train those who can’t afford to train with football academies. Sports shouldn’t just be for those who can pay the monthly fees. We don’t want children from the lower income group to miss out on formal football training, and it is thanks to such sponsorships that we can get them on board.
“This will also serve as a great motivation for other sporting clubs. The onus shouldn’t be just on the government to provide funds. If there are corporate sponsors willing to invest in us, then it’s only fair for them to get some form of benefit through tax relief. This, to me, is a win-win solution for all parties involved.”
Rada Krishnan went on to encourage more grassroots sports club operators to liaise with the Finance Ministry.
“They were quick to respond (to our request), and are ever willing to listen. That, to me, says a lot about the ministry’s efficiency, and sincerity in assisting grassroots clubs like us.”
Last month, Twentytwo13 reported that Rada Krishnan had written to the ministry, appealing for tax exemptions for companies that sponsored his club’s sporting activities.
In his letter to the ministry, Rada Krishnan said his academy had suffered financial difficulties in carrying out grassroots development programmes, because companies had pulled their sponsorships, as their investments were not recognised by the government.
Rada Krishnan had earlier told Twentytwo13 that the government would have done grassroots sports players in Malaysia a huge favour by providing tax exemptions to companies wanting to invest in sports academies.
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