Goods & Services Tax (GST)
WHAT (IS GST TO BUSINESS OWNERS)
- Known as value added tax (VAT)
- Tax on the final consumption
- Cover all sectors in the economy
- Multi stage taxable level
- Replacing current sales and service tax
HOW (GST AFFECTS BUSINESS OWNERS)
1. You are required to REGISTER your business with Jabatan Kastam Diraja Malaysia for GST purpose:
- Mandatory registration for GST if annual taxable turnover of your business is more than RM500,000.00
(registration before the end of December 2014)
- Voluntary registration for GST if annual taxable turnover of your business is less than RM500,000.00
- Early registration start from May 2014
2. Is your SYSTEM well equipped with GST features?
- Compulsory for the business owners to have an accounting system which is equipped with the GST features
- i.e. able to map items to the tax codes provided by Jabatan Kastam Diraja Malaysia
- i.e. able to captured input tax and output tax automatically
- i.e. print out automatically filled forms for GST returns submission
- i.e. generate proper GST Audit File (GAF) for submission and etc.
3. You need to SUBMIT the GST returns:
What can you do, if you are not GST registered BUT your supplier is charging you GST on the purchases made?
- Business which annual turnover exceeding RM 5 million, you are required to do monthly submission of GST return
- Business which annual turnover not more than RM 5 million, you are required to do quarterly submission of GST return
WHY (BUSINESS OWNERS SHOULD CARE ABOUT GST)
- If you are required to register by 31st December 2014, but you fail to do so.
You will be FINE not exceeding RM 50,000 or IMPRISONMENT for not more than 3 years.
- If the annual taxable turnover of your business is less than RM 500,000.00.
You may opt not to register for GST BUT you will not be able to claim the input tax incurred
AND charging output tax to the customers is prohibited.
You will need to ABSORB the input tax incurred for the business.