close
Share with your friends

Malaysia: Service tax on imported services, policy updates

Malaysia: Service tax on imported services, updates

Malaysian authorities issued three “service tax policies” as guidance about measures to address the potential cascading effect of the service tax on imported services.

1000

Related content

Service Tax Policy 7/2020 concerns accounting for service tax for persons otherwise exempt from paying service tax. Effective 1 January 2020, subject to certain conditions, those that are exempt from self-accounting for service tax on imported taxable services include:

  • Any person that, in carrying on a business, acquires digital services from foreign registered person
  • Any taxable person providing information technology services (ITS) having acquired those ITS from a person outside Malaysia

Service Tax Policy 8/2020 concerns group relief on providing taxable services to a company within the same group of companies. Effective 1 January 2020, the group relief facility may still be applicable with regard to taxable services provided to group members even if the same service is provided to a third party as long as the value provided to third parties does not exceed an amount equal to 5% of the total value of taxable services within a period of 12 months.

Service Tax Policy 9/2020 concerns the service tax treatment of taxable services under Group A: Accommodation (including hotels, inns, lodging houses, service apartments and other similar establishments that are exempted from charging service tax on taxable services provided from 1 March 2020 to 31 August 2020).

Read a March 2020 report prepared by the KPMG member firm in Malaysia

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Want to do business with KPMG?

 

loading image Request for proposal