Tax highlights from your advisers...Tax Whiz 2020 | Service Tax Policy No 10/2020 a) Where payment...
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© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 0 Tax Whiz Tax highlights from your advisers KPMG in Malaysia Updated as at 23 April 2020 Service Tax Policy No 10/2020 Service Tax Exemption on Digital Services relating to Banking and Financial Services
Transcript of Tax highlights from your advisers...Tax Whiz 2020 | Service Tax Policy No 10/2020 a) Where payment...
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Tax WhizTax highlights from your advisers
KPMG in Malaysia
Updated as at 23 April 2020
Service Tax Policy No 10/2020
Service Tax Exemption on Digital Services relating to Banking and Financial Services
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Tax Whiz 2020 | Service Tax Policy No 10/2020
Service Tax Exemption on Digital Services relating to Banking and Financial Services
The Royal Malaysian Customs Department (“RMCD”) has issued the Service Tax Policy 10/2020 (as at 17 April 2020) with regards to the Service Tax exemption on digital services provided in relation to banking and financial services.
Set out below is a summary of the Service Tax Policy:-
Effective 1 January 2020, the provision of digital services [taxable under item (m), Group G, First Schedule of the Service Tax Regulations 2018] in relation to banking and financial services by a local service provider is exempted from Service Tax under Section 34(3)(a) of the Service Tax Act 2018, where the service recipient is exempted from the payment of Service Tax.
The abovementioned Service Tax exemption is only applicable to the digital services provided in relation to banking and financial services by specific local financial service providers, as listed under Paragraphs 4.1, 4.2 and 4.3 of the Service Tax Policy.
Where Service Tax has been charged by a registered person on the provision of digital services on or after 1 January 2020 (which qualified for the exemption), the adjustments are as follows:
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Tax Whiz 2020 | Service Tax Policy No 10/2020
a) Where payment has not been received by the registered person, but Service Tax has been accounted for (e.g. on invoice basis)
The registered person should issue a credit note in accordance with the Service Tax legislation and make adjustment in the Service Tax Return accordingly.
b) Where payment has been received by the registered person
No refund is allowable on the Service Tax that has been paid.
Note:
Paragraph 6.2 of the Service Tax Policy states that, for taxable services spanning 1 January 2020, Service Tax should be charged and accounted on the services provided prior to 1 January 2020.
Notwithstanding the above, it should be noted that the provision of digital services [under item (m), Group G, First Schedule of the Service Tax Regulations 2018] is prescribed to be a taxable service effective 1 January 2020.
Please click here for a copy of the Service Tax Policy at the RMCD’s official website.
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Tai Lai KokExecutive Director –Head of Tax and Head of Corporate [email protected]+603 7721 7020
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Tax Whiz 2020 | Report Name
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