Extended Movement Control Order: IRB’s concessions

31 July 2019 until 31 August 2019

31 July 2019 until 31 August 2019

A. General

Please refer to IRB’s press releases dated 17 March 2020, 24 March 2020, 27 March 2020, 29 March 2020, 2 April 2020, 13 April 2020, 22 April 2020, 27 April 2020 and 28 April 2020 on services available to customers during the MCO period.

If there are any tax queries, taxpayers may use the Feedback Form available on the IRB’s official portal.

Comment:

This has been updated to take into account the IRB’s media releases dated 22 April 2020, 27 April 2020 and 28 April 2020, informing taxpayers of the services available during the MCO period.

The following counter services are not provided at IRB’s branches during the MCO period:

i. e-Filing counter

ii. Bantuan Sara Hidup (BSH) counter

iii. Bantuan Prihatin Nasional (BPN) counter

iv. Geran Khas Prihatin (GKP) counter

Comment:

This is a new item in the FAQ document, in line with IRB’s media release dated 28 April 2020.

To facilitate tax matters during the MCO period, IRB will provide the following services:

8.00 a.m. – 4.00 p.m.

(based on working days in each State)

8.00 a.m. – 12.00 p.m.

(based on working days in each State)

8.00 a.m. – 12.00 p.m.

(Monday to Friday)

a) HCL:
9.00 a.m. – 4.30 p.m.
(Sunday to Friday)

B. IRB’s office:
9.00 a.m. – 4.30 p.m.
(based on working days in each State)

Taxpayers may apply for an e-Filing PIN number through:

(a) The Customer Feedback Form available on the IRB’s official portal; or

(b) Refer to the User Guide on the ezHASiL website

(a) Taxpayers who have a registered e-mail address or handphone number with IRB can reset his/her password by clicking on the “Forgot Password” link on the ezHASiL website.

(b) Taxpayers who do not have a registered e-mail address or handphone number, or who have changed their registered e-mail addresses or handphone numbers, will be able to update the details through the Customer Feedback Form on the IRB’s official portal.

An extension of time will be provided as stated in the Return Form (RF) Filing Programme for the Year 2020 (Amendment 3/2020).

Comment:

This has been updated to take into account the updated RF Filing Programme dated 28 April 2020. Details are as highlighted in the main body of this Tax Alert.

4. Will an extension of time be given for the submission of Country-by-Country Reporting (CbCR)?

(a) For entities in Malaysia responsible for the filing of the CbCR report:

(i) An extension of time is given until 15 May 2020 for submissions due on 31 March 2020

(ii) An extension of time is given until 31 May 2020 for submissions due on 30 April 2020

(b) For the purpose of CbCR notifications by constituent entities, the deadline for submissions due by 31 March 2020 or 30 April 2020 will be extended until 31 May 2020.

5. What is the alternative where an application for a Certificate of Residence (CoR) via the e-Resident platform is not feasible as supporting documents need to be submitted?

Applications can be submitted via the following:

(a) Customer service counter; or

(b) E-mail to lhdn_int@hasil.gov.my

Please visit the following link for further information.

Comment:

The previous FAQ document indicated that applications can be submitted online (via e-mail to lhdn_int@hasil.gov.my) only in cases where the CoR is required urgently. Otherwise, applications may only be made after the MCO period. 

The Forms can be submitted via the following:

(a) Customer service counter; or

(b) E-mail to the Customer Care Office of the relevant IRB Branch per the following list.

Comment:

The previous FAQ document indicated that the Forms could only be submitted from 29 April 2020.

7. How can an application for tax clearance letters (TCLs) be made during the MCO period?

Applications can be submitted via the following:

(a) e-SPC;

(b) Customer service counter; or

(c) E-mail to the Customer Care Office of the relevant IRB Branch per the following list.

The processing of TCL applications will be made upon receipt of the complete document and information.

Comment:

The previous FAQ document indicated that applications for TCLs could only be made through e-SPC at any time, or by coming to IRB’s premises beginning 29 April 2020. In addition, the processing of TCL applications will only be made beginning 29 April 2020.

8. Will an extension of time be given to Labuan entities for the submission of the irrevocable election form to be taxed under the ITA (Form LE3) where the due date is during this period?

Example 1:

The accounting period or basis period for a Labuan entity is 01/01/2020 – 31/12/2020. The due date for submission of Form LE3 for the Year of Assessment (YA) 2021 (YA 2020 under the ITA) is on 31/03/2020.

Example 2:

The accounting period or basis period for a Labuan entity is 01/02/2020 – 31/01/2021. The due date for submission of Form LE3 for the YA 2022 (YA 2021 under the ITA) is on 30/04/2020.

An extension of time will be given until 31 May 2020 for the submission of Forms LE3 for YA 2021 and YA 2022, where the due date for submission falls within the MCO period.

Comment:

This has been updated to clarify the references to the specific “year of assessment” under the Labuan Business Activity Tax Act 1990 and ITA.

An extension of time for the submission of Form CP204B will be given until 31 May 2020.

An extension of time will be given until 31 May 2020.

An extension of time will be given until 31 May 2020.

3. When is the due date for the submission of the revision of estimate of tax payable in the third month of instalments in 2020 (as proposed in the 2020 ESP)?

The due date is based on the company’s basis period. An extension of time is granted until 31 May 2020 for the revision in the third month of instalment that falls in April 2020.

Editor’s note: We understand that this concession for a third-month revision does not extend to the Petroleum (Income Tax) Act 1967.

All businesses which qualify as a Small and Medium Enterprise (SME)

Companies related to the tourism industry (including SMEs)

6. What are the criteria for a business to qualify as an SME?

The criteria are as follows:

i. Paid-up capital with respect to ordinary shares of RM2.5 million or less at the beginning of the basis period for a YA; and

ii. Gross business income of RM50 million and below

7. What are the sources of data that will be used by the IRB in order to determine whether the SMEs qualify for the deferment of estimated tax payment?

The data will be based on the YA 2018 Return Form received by the IRB.

Editor’s note: The IRB has clarified that a company’s SME status as indicated in Item XII of the Form e-C for YA 2018 is irrelevant in determining whether or not the company is an SME for this purpose. Reference will instead be made to the information obtained from the company’s YA 2018 tax computation / return.

8. Would additional criteria such as Paragraphs 2B and 2C, Schedule 1 of the ITA be applicable for a business to qualify as an SME for the purpose of the deferment of instalment payments?

Comment:

Previously, the FAQs referred to Paragraphs 2A and 2B, Schedule 1 of the ITA instead.

No. For this purpose, businesses will only need to fulfil the criteria as mentioned in Item D.6.

No. The deferment of the CP204 payments will be given automatically to all SMEs based on the IRB’s records.

10. It was previously informed that taxpayers in tourism-related industries would be required to submit a manual application for the deferment of CP204 payments.

Is this process still applicable?

No. The deferment of the CP204 payments will be given automatically based on the IRB’s records.

Income Tax estimates for non-companies (CP500)

1. Can the payments for CP500 tax estimates be deferred?

Yes. The months eligible for deferment are March 2020 and May 2020.

*It is unclear what the IRB’s intention is, as the IRB’s FAQs state that payments can be deferred commencing April 2020 to June 2020, for the eligible months (i.e. March 2020 and May 2020).

Yes. Taxpayers will be allowed to revise the CP500 tax estimates on or before 30 June 2020.

Yes

No. The deferment of the CP500 payments will be given automatically to eligible taxpayers based on the IRB’s records.

No. The deferment of CP204 or CP500 payment for companies or businesses that qualify under the Economic Stimulus Package will not be subject to a tax increase under Section 107C(9) or 107B(3) of the ITA.

Yes. The taxpayer can reject and continue to remit the tax estimate payments based on the original payment schedule without having to inform the IRB.

5. Will the IRB issue a notification to taxpayers who are entitled to the deferment of tax estimate payments?

6. Can a taxpayer lodge an appeal if the company finds that it is eligible for the deferment of tax estimate based on the current situation of the company?

Yes. Taxpayers can appeal by way of letter or e-mail to the Records Management and Taxation Information Division. A notification e-mail will be issued if the appeal is approved.

Editor’s note: It is not clear how or when this “appeal” is to be applied, given that in item 19 above, the IRB has indicated that qualifying taxpayers who have yet to receive a confirmation email from IRB simply do not need to remit the 15 April 2020 instalment. We believe that an appeal would only need to be lodged if the IRB challenges the taxpayer’s position of not remitting the instalment. Alternatively, it is possible that the appeal opportunity is for companies which meet the “SME” definition for YA 2019 and/or YA 2020 but not YA 2018. Clarification is being sought from the IRB on this point.

7. Will an extension of time be given to Labuan entities for the submission of forms and payments during this period?

An extension of time will be given until 31 May 2020.

Editor’s note: It was previously clarified that Labuan entities would get an automatic extension until 29 July 2020 to submit their tax returns for the YA 2020. A further extension until 28 October 2020 is also possible upon application and subject to conditions. These extensions are only applicable to Labuan entities which are up-to-date with their tax filings and payments. The extension until 31 May 2020, as indicated above, would apply to companies which do not meet the conditions for the extension announced earlier, e.g. entities with outstanding filings or tax arrears.

8. How should one make payments which exceed the limit set by internet banking?

Tax payments exceeding the threshold can be remitted via:

(a) ByrHasil at IRB’s official portal or online banking (payment in stages);

(b) Telegraphic Transfer (TT) at banks, followed by the submission of payment details to the IRB via e-mail (HelpTTpayment@hasil.gov.my) or fax (03-6201 9637);

(c) Payment by cheque at bank counters or cheque deposit machines provided by banks;

(d) Payment by cheque at IRB’s payment centres or sent by postal or courier services

Comment:

Previously, only Option (b) was stipulated as a method of remittance for tax payments exceeding the internet banking threshold.

9. How can withholding tax (WHT) be remitted during the MCO period?

Payments of WHT which fall within the MCO period can be made beginning 13 May 2020 until 31 May 2020.

Payments can also be made via TT by furnishing complete payment details to the IRB  through fax (03-6201 9637) or e-mail (HelpTTpayment@hasil.gov.my).

Comment:

The previous FAQ document indicated that payments of WHT could be made beginning 29 April 2020.

10. Will penalties be imposed on WHT payments which should be made within the MCO period?

Payments of WHT which are due within the MCO period can be made beginning 13 May 2020 up to 31 May 2020. No penalty will be imposed on late payments.

Comment:

The previous FAQ document indicated that payments of WHT could be made beginning 29 April 2020.

An extension of time will be given until 31 May 2020.

Payments can be made before 31 May 2020.

13. Will the IRB defer the tax refund process?

Tax refunds will be processed as usual. However, in an ongoing audit case, taxpayers are required to submit the supporting documents as requested within the MCO period for the purpose of tax refunds.

1. Are all stamp duty counters open? What are the operating hours?

Stamp duty counters at the Branch Stamping Offices nationwide recommenced operations on 3 April 2020. The stamp duty counters at Revenue Service Centres and UTC Johor Bahru will remain closed until the end of the MCO period.

Please refer to IRB’s press releases dated 2 April 2020, 13 April 2020 and 28 April 2020 for the operating hours of the stamp duty counters.

Comment:

This has been updated to take into account the IRB’s media releases dated 13 April 2020 and 28 April 2020, informing taxpayers of the services available during the MCO period.

2. Can sales and purchase agreements (SPAs) for houses be stamped during this period?

Stamp duty on SPAs for houses is RM10.

(i)    Duty payer may purchase the Revenue Stamp from post offices.

(ii)  Affix the stamp on the agreement

(iii) The stamp can be executed by drawing a line across the stamp and writing or marking the current date on the stamp.

The cancellation of Revenue Stamps as stated above is only possible for documents that attract a fixed duty under Item 4, Schedule 1 of the Stamp Act 1949 (e.g. SPAs for houses).

4. Who can use STAMPS?

5. Can individuals use STAMPS?

6. How can an individual, whose business is not registered with SSM, do stamping during this period?

Stamp office branches nationwide are fully operational from 29 April 2020. However, an extension of time will be given until 31 May 2020 for the stamping of all documents which should have been duly stamped between 18 March 2020 and 30 May 2020.

Operation hours based on the working days of the relevant State is from 8.00 a.m. to 12.00 p.m.

Comment:

Previously, stamp duty counters nationwide were operational from 3 April 2020 to cater to individual duty payers, with limited services available. This has been updated to take into account the IRB’s latest media release dated 28 April 2020 on services available during the MCO period.

7. How do duty payers, other than individuals, make stamping applications?

Stamping can be done via:

(a) Stamp duty counters at Branch Stamping Offices; or

(b) Online via the STAMPS platform (https://stamps.hasil.gov.my)

Agents or representatives with STAMPS user ID are required to submit the stamping application and make payments online.

Comment:

Previously, stamping could only be done online via the STAMPS platform.

8. How does one verify the validity of a Stamp Certificate?

Verification can be made via:

(a) https://stamps.hasil.gov.my or

(b) Semakan Ketulenan Sijil mobile application (ANDROID / iOS)

9. How to make online payments?

(i) Online payments can be made by STAMPS users through the FPX medium, CIMB Bizz Channel online or Public Bank for cases with the “sedia untuk bayaran duti” status.

(ii) Print the stamp certificate after payment has been successfully made

(iii) Attach the stamp certificate to the physical document as proof of payment

10. Will penalties for late payments be imposed?

Where payments for notices of assessment on stamp duty fall within the MCO period, the payments can be made up to 31 May 2020. No penalty will be imposed if payments are made by this date.

G. Contribution / Donationg. 

(Comment: All the items in this Section are new, except Q1 and Q18) 

Cash and in-kind

Contributions can be channeled to the COVID-19 Fund managed by the Ministry of Health Malaysia (MoH)

Contributors with business income are entitled to a deduction from gross business income, on the contributions made.

5. What is the supporting document needed to claim a tax relief or tax deduction for cash donations under Paragraph 34(6)(h) of the ITA?

i. Government official receipt (Kew. 38);

ii. Money transfer slip (for remittance via ATM);

iii. Cheque deposit machine slip;

iv. Deposit slip (for remittance via bank counter);

v. Online payment slip;

vi. Transfer slip via Interbank Giro (IBG Transfer);

vii. Receipt from the Real Time Electronic Transfer of Funds and Securities (RENTAS) System; or

viii. Telegraphic transfer (TT) receipt with credit advice

6. What is the supporting document needed to claim a tax relief or tax deduction for contributions of equipment or goods under Paragraph 34(6)(h) of the ITA?

i. The original approval letter from the Ministry of Finance Malaysia (MoF)

ii. Official receipt or letter of receipt of donation from the receiving body; or

iii. Verification letter of the service value or project cost value from the relevant Government agencies

7. What are the types of goods that can be contributed?

Eligible contributions:

i. Equipment such as ventilators, patient beds and air conditioners;

ii. Face masks, hand sanitizers, gloves, test kits and personal protection equipment (PPE);

iii. Services such as cost of disinfection and sanitization (roads, buildings, markets, places of worship etc.), moving toilets and delivery of supplies; or

iv. Cost to provide permanent or temporary infrastructure (for example, tents, marquee tents to accommodate extra beds)

8. Where should the application be submitted?

The complete application may be submitted to:

Setiausaha Bahagian Cukai

Tingkat 6, Blok Tengah

Kompleks Kementerian Kewangan

Presint 2, Pusat Pentadbiran Kerajaan Persekutuan

62592 Putrajaya

The tax deduction can be claimed in YA 2020.

No. A double claim is not allowed for the same amount.

Beginning February 2020 until the pandemic is declared over by the Government

Cash donations only

i. National Disaster Management Agency, Prime Minister’s Department; or

ii. Institutions, organizations or funds approved under Section 44(6) of the ITA

No. An institution, organization or fund that has been approved under Section 44(6) of the ITA is eligible for such contributions or donations.

Information can be obtained from the IRB’s official portal as follows:

List of Institutions for Donations under Section 44(6) of the ITA

16. What is the supporting document needed to claim a tax deduction?

i. National Disaster Management Agency, Prime Minister’s Department

• Government official receipt (Kew. 38);

• Money transfer slip (for remittance via ATM);

• Cheque deposit machine slip;

• Deposit slip (for remittance via bank counter);

• Online payment slip;

• Transfer slip via Interbank Giro (IBG Transfer);

• Receipt from the Real Time Electronic Transfer of Funds and Securities (RENTAS) System; or

• Telegraphic transfer (TT) receipt with credit advice

ii. Institutions, organizations or funds approved under Section 44(6) of the ITA

• Official receipt that has been approved by the IRB

17. What is the amount allowed for tax deduction?

i. National Disaster Management, Prime Minister’s Department

• Tax deduction amount is equal to the amount of the contribution

ii. Institution, organization or fund approved under Section 44(6) of the ITA

• The tax deduction amount is restricted to 10% of the aggregate income

Yes. An extension of time will be given until 30 June 2020.

No. A tax deduction will only be allowed with the necessary supporting documents.

The tax deduction can be claimed in YA 2020.

Yes. Employers are allowed to collect contributions or donations and donate them on behalf of employees. The information required are as follows:

i. Proof of payment;

ii. Payment amount;

iii. Company / Employer’s registration number;

iv. Company / Employer’s income tax number;

v. Employee’s name;

vi. Employee’s identification number;

vii. Employee’s income tax number;

viii. IRB branch which handles the employee’s income tax number;

ix. Amount of contribution made by the employee

An internal circular will be provided to the relevant IRB branches.

Tax deductions are to be claimed by the employees and not the employers.

The table to be provided is as follows: