Malaysia

Malaysian GST registration

How to check if a Business is registered for Malaysian GST

Malaysian GST has now gone live. This new Goods and Services Tax has replaced the old Service Tax.

Their GST is based upon widely accepted OECD standards, which includes full liability across the whole production chain with the right to deduct, and on imports. This is fundamental change from the existing consumption taxes which are only charged once, which have no ability to deduct.

Since the introduction of GST on 1st April 2015, businesses that have registered with the Royal Malaysian Customs have started charging GST on the goods and services that they provide, unless these goods or services fall under the exemptions or zero rated lists or the customer is granted relief from GST.

If you are now receiving invoices with GST charged you must ensure that you are only paying GST to businesses registered and authorised to charge it.

 

How to check a company’s GST status

So how can you check if a company is registered for GST? Continue Reading

Malaysian GST – When do I have to set a supplier up for GST?

We often have clients that want to put every small purchase through their petty cash process but there is legislation to limit this.

GST Regulations 2014, S38(a)(ii) states :

“A tax invoice which does not contain the name and address of the recipient where approval has been given by the Director General under paragraph 33(3)(a) of the Act provided that the maximum amount of input tax to be claimed is not more than thirty ringgit;”

So if the receipt is more than 30 Ringgit and from a registered GST supplier then it should be set up as a supplier! A way around this is for an individual to purchase the item themselves and then submit an expense claim.

Malaysian GST – do you have to register for MY GST if you sell to Malaysia but are not located there?

GST Act 2014, Guide on Tax Invoice and Records Keeping and Guide on Agents.

GST Act 2014 , S65(6) states:

“ where a person who does not belong in Malaysia makes taxable supply in Malaysia and is liable to be registered under section 20 or intends to be registered under section 24, he shall appoint an agent to act on his behalf and such agent, whether or not he is a taxable person, shall be liable for the tax and comply with any other requirements imposed under this Act as if the agent is a person who does not belong in Malaysia.”

Please refer to page 8 and 9 of the Guide on Agents for further explanation on the discussed scenario.

Why MY GST is nothing like Singapore or Australia and more like Europe!

Recently, when setting up the new Malaysian GST, I took to the task assuming that it would be nice and simple and done in a few hours, following the same structure as I would for Singapore which has one of the more simplistic GST setups in Oracle R12 or Fusion. It did not take long however to realize that Malaysia was a complete different animal when it came to the GST solution.

At its bare minimum, there is a 6% GST and a 0% GST rate but unfortunately, as those that know about indirect taxation, its not just about the tax rate but why and as such, VAT or GST is also about information as to why you are charging a certain rate or to provide statistical information to the relevant tax authorities. As such, there are well over 20 different GST tax reporting codes that need to be considered that need to be included on the GST returns for Malaysia.

Indeed, the Malaysian GST was based on the tax regimes of the UK, Singapore and Australia and that is very evident as there is more of a European style with the requirements for reverse charging than anything like Singapore GST.

So before you foolishly go ahead and set the MY GST up in the footprints of SG GST, make sure you do your research and get the right advice or you will soon fall foul of the Malaysian Customs when you start submitting those GST returns.

For more information on Malaysian GST please see our previous posts.

Review of ‘E-Business Suite R12: Malaysia Goods and Services Tax (GST)
Are you ready for the 2015 Malaysian GST?

Oracle R12 Malaysian GST 21 day rule

There is a requirement that if the invoice is not issued within 21 days of the service being supplied then a different tax date is required.

This could be handled with a patch (For automated tax date for AP and AR transactions – patch 12726737 – Used for ECE reports) from Oracle that will apply a tax date to every transaction but unfortunately this patch is country specific so won’t work for Malaysia.

We can however still use European setups to capture the tax date as a way of doing the tax reporting. What this means is that whilst an invoice, either in AP or in AR can have an invoice (or transaction) date, but a customization would be needed to update the tax date because Oracle does not do this for us.

 

Are you ready for the 2015 Malaysian GST?

Oracle R12 and Fusion Tax – Malaysian 2015 GST Implementation – Accounting (Tax) Software Compliance and Requirements

On 01 April 2015, the Royal Malaysian Customs Department will implement Goods and Services Tax (GST) replacing the current Consumption Tax. The introduction of GST is part of the Government’s tax reform programmed to enhance the efficiency and effectiveness of the existing taxation system.

As a consequence of this change, companies have to ensure their Accounting Software in use for business is in compliance with new requirements. Developing/Enhancing the accounting software will be necessary to produce additional electronic files, listings, reports, etc. This is something that eBiz Answers has been working on for some time and now has an off-the-shelf solution available for Oracle R12 and Oracle Fusion. Continue Reading

Review of ‘E-Business Suite R12: Malaysia Goods and Services Tax (GST), February, 2014 (Doc ID 1624947.1)’

Malaysian GST (MY GST) in Oracle R12 and Oracle Fusion

This article is to provide a little more information on  ‘E-Business Suite R12: Malaysia Goods and Services Tax (GST), February, 2014 (Doc ID 1624947.1)’

We have managed to use standard functionality to pull all the requirements together. Oracle have looked at this and have said they are not going to do anything special to get ready for the launch date and I have to agree with them! The required data needed for the GST submissions can be collected using standard functionality. The Financial Tax Register could be used to report the right data although crudely so we do suggest that you look at getting expert help so that first the data is captured in the most optimal way, using a fully automated solution (NO DEFAULTING TAX CODES!) and then a bespoke report will be able to neatly provide all the reporting requirements linked to the right tax codes.

You can click here for the Oracle link which we suggest you monitor because at the time of writing, it was last updated in February so a change is likely soon. Continue Reading