Professional Documents
Culture Documents
Output
Q: Are all companies liable to be registered as GST
registered person?
A: Yes, if you make taxable supplies and have annual turnover
exceeding RM500,000. However, if your annual turnover is
below this threshold, you can still apply for voluntary
registration.
Q: What is a taxable supply?
A: A taxable supply may not be restricted to your sale of goods.
It includes : Disposal of business assets
Business gifts exceeding RM500 given to same customer in
the same year
Fringe benefits given to employees
Application of business assets for non-business purposes
Goods which are business assets on hand at deregistration
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Output (contd)
Q: If I am registered in Malaysia and provide services
outside Malaysia, is the supply subject to GST?
A: Yes, this is taxable supply but it is zero rated. You are
eligible to claim input tax for all supplies related to such
services.
Q: If I have a business registered outside Malaysia, do I
account for GST ?
A: No, the business is considered out of scope.
Output (contd)
Q: If I give discount to my customers, can I charge GST
on the discounted price?
A: Yes, GST should be computed on the discounted price
Q: When a certain quantity of goods are given free as
incentive for bulk purchases, for example for every 20
units of a product purchased at a price of RM5,000, I
offered my customer 2 units free, must I also account
GST on the 2 units given free?
A: GST will be based on RM5,000. The 2 units given free will be
considered as discount
Output (contd)
Q: If I give business gifts to my customers, do I have to
account for GST?
A: In principle, gifts to customers are deemed taxable supply
because it is made in the course of furtherance of your business.
However, under GST law, a gift is not a supply and no GST is due if
the cost of the gift is worth less than RM500 and given to the same
customer in the same year. Any input tax incurred is claimable.
Inputs
Q: Can a registered company treat all the GST paid for
the business acquisitions or purchases as his input tax?
A: Generally, all GST incurred can be treated as his input tax, if
he incurs the GST for his business purpose.
Inputs normally acquired can be categorised as follows :Capital assets goods that can be capitalised for accounting
purposes e.g. land and building, plant & machineries & office
equipment
Raw materials and components
Services, utilities and other charges
Services supplies other than goods such as maintenance of
plant and machineries, professional fees
Other charges telephone, rental, transportation
Utilities water, electricity
Administrative expenses
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Inputs (contd)
Q: If have to return some goods to my supplier due to
defect, can I claim GST paid on returned goods?
A: When you returned the goods, your supplier should refund
you the GST paid by way of a credit note. If you have already
claimed the input tax, then you have to reduce the said input
tax in the taxable period in which the credit note is issued
Q: If I acquire certain services from overseas, what is my
GST liability?
A: When you acquire services from overseas, you are treated as
making the supply. Therefore, you need to account for tax on
such services.
However, if you are making wholly taxable supplies, you can
claim the entire GST accounted, and hence no net GST
implication.
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Inputs (contd)
Q: Can I claim input tax on the whole value (purchase
price) of a machinery acquired under hire purchase?
A: Yes, you can claim on the whole purchase price based on the
instalments paid. In a situation where interest charged is
separately identified, the interest is not subject to GST (exempt
supply).
Q: What is the GST implication on machinery that I
acquire under lease?
A: If it is a finance lease, the treatment is similar to hire
purchase (as above).
Inputs (contd)
Q: How do I claim input tax when I paid advance
payment for a machinery until it is ready for collection?
A: Your supplier would charge you GST on the value of each
payment received. You can claim input tax based on the tax
invoice that you receive.
Q: If I am given credit term by my supplier, can I claim
input tax before I make the payment to supplier?
A: Yes, provided you hold a valid tax invoice from your supplier
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Employee benefits
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Output tax
Q: Under what instances do I have to account for output
tax on employee benefits?
A: Basically, any goods given free to employees are subject to
GST.
However, under the gift rule, if the cost of goods does not
exceed RM500 and given free to the same employee in the
same year, you do not need to account for GST.
If the cost exceeds RM500, you have to account for GST except
for those goods come under blocked input tax recovery or if it
is stated in the employment contract or company policy.
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A: No, for services, you do not have to acount for GST if the
services for your employees are provided free.
Q: Should I acount for GST when
accommodation to my employees?
provide
free
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Property developers
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Supply
Q: In the course of undertaking property development
project, I have to surrender part of my land to the State
Authority without money consideration to be used for
educational, religious, charitable or public use. These
supplies include roads, police stations, schools, recreational
areas and other public amenities. Are these supplies
subject to GST?
A: No, these are non-supplies and hence not subject to GST.
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Supply (contd)
Q: I have to transfer the infrastructure of utility services
such as sub-stations, sewerage treatment plant and
water tank to the respective utilities provider for a
nominal charge. Are these transfers/ supplies subject to
GST?
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Supply (contd)
Q: I charge administrative fees for services such as
endorsement of deed of assignment. Is the supply
subject to GST?
A: Yes, administrative services are subject to GST at standard
rate.
Q: I charge interest for late payment? Is the interest
subject to GST?
A: No, interest related to late payment is regarded as penalty
and is considered out of scope.
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Supply (contd)
Q: Is the conversion premium imposed by Federal/ State
Authority subject to GST?
A: No, the conversion premium and all other premium and fees
imposed by Federal/ State Authority related to real estate is
regarded as out of scope. Hence, is not subject to GST.
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Time of supply
Q: When do I account for GST for supply of uncompleted
property under progressive payment contract?
A: You have to account for GST at various stages of progressive
payment based on the earlier of :
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Retention sum
Q: When customer pays deposit to a lawyer who acts as
the developer agent, does the deposit triggers a tax
point?
A: Yes, hence GST is chargeable on deposit received.
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Liquidated damages
Q: Is there any GST implication on liquidated damages
imposed for late delivery?
A: No, since it does not form part of supply.
Q: If I have to pay liquidated damages & at the same
time charge the client for another supply, can I set-off
each other?
A: No, you cannot reduce the value of taxable supply by setting
off each other as they relate to different supplies. GST has to
be accounted separately.
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Others
Q: If I supply materials and utilities and loan workers to
contractors for use in my project, can I contra the value
of the materials, utilities and workers from the value of
construction services supplied to me?
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Thank you
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