FAQs on revision of tax estimate and deferment of tax installments
IRB’s FAQs on revision of estimate of tax payable and deferment of tax instalment payments arising from COVID-19 measures
As highlighted in earlier alerts, a number of tax and non-tax measures have been announced as Malaysia’s response to the COVID-19 pandemic, including the following:
- Businesses in the tourism sector and Small and Medium Enterprises (SMEs) (as defined) are allowed to defer their monthly income tax instalment payments
- Businesses are allowed to revise their estimate of tax payable in the month of the third monthly tax instalments, where the third-month tax instalment falls in 2020
The Inland Revenue Board (IRB) has now issued a Frequently Asked Questions (FAQs) document, in Bahasa Malaysia, titled “Soalan Berkaitan Pindaan Anggaran Cukai (CP204) Pada Bulan Ketiga Ansuran Dalam Tahun 2020 Dan Penangguhan Bayaran Anggaran Cukai Bagi Syarikat Berkaitan Industri Pelancongan Dan Perusahaan Kecil Dan Sederhana (PKS) Di Bawah Pakej Rangsangan Ekonomi (PRE) 2020”, to provide clarification on the above proposals.
Some of the key points are outlined below.
FAQs on the revision of estimate of tax payable in the month of the third tax instalment, where the third-month tax instalment falls in 2020 |
(a) Q7: Does the taxpayer have to wait for approval from the IRB for this application?
It is not necessary as long as the application is complete, in order and satisfies the qualifying criteria accordingly.
(b) Q8: When is the due date for the submission of this revision?
The due date depends on the basis period of the company.
| Basis period | Third month of tax instalments | Due date for the submission of the revision | Effective date of the revision |
| 1 January 2020 –31 December 2020 | April 2020 | 31 May 2020 (extension of time granted as per the IRB’s FAQs) | Instalment originally due on 15 April 2020^ (extension of time granted) |
| 1 August 2020 – 31 July 2021 | November 2020 | 30 November 2020* | Refer to Note below |
*If the application form is submitted before 15 November 2020, the revision is effective for the instalment due on 15 November 2020. If the application form is submitted after 15 November 2020, the revision is effective for the instalment due on 15 December 2020.
It is not clear, however, what the effective date is for applications submitted on the 15th of the month.
^Based on the IRB’s latest FAQs dated 21 April 2020, an extension of time is granted until 31 May 2020 for tax instalment payments due on 15 April 2020 and 15 May 2020.
FAQs on the deferment of monthly income tax instalment payments for businesses in the tourism sector and SMEs |
Q2: What are the Malaysian Standard Industrial Classification (MSIC) codes for businesses in the tourism sector that qualify for this deferment?
51101 - 51103, 55101 - 55109, 55200, 55900, 50111 - 50113, 79110, 79120 and 79900 (refer to the Appendix to the Alert for further details).
For further details, including examples on the mechanism of the above-mentioned proposals, please refer to the FAQs which are available via the following link:
| No. | Business code | Activity |
| 1 | 51101 | Transport of passengers by air over regular routes and on regular schedules |
| 2 | 51102 | Non-scheduled transport of passengers by air |
| 3 | 51103 | Renting of air-transport equipment with operator for the purpose of passenger transportation |
| 4 | 55101 | Hotels and resort hotels |
| 5 | 55102 | Motels |
| 6 | 55103 | Apartment hotels |
| 7 | 55104 | Chalets |
| 8 | 55105 | Rest houses / guest houses |
| 9 | 55106 | Bed and breakfast units |
| 10 | 55107 | Hostels |
| 11 | 55108 | Home stays |
| 12 | 55109 | Other short-term accommodation activities |
| 13 | 55200 | Camping grounds / sites and recreational vehicle parks |
| 14 | 55900 | Other accommodation |
| 15 | 50111 | Operation of excursion, cruise or sightseeing boats |
| 16 | 50112 | Operation of ferries, water taxis |
| 17 | 50113 | Rental of pleasure boats with crew for sea and coastal water transport |
| 18 | 79110 | Travel agency activities |
| 19 | 79120 | Tour operator activities |
| 20 | 79900 | Other reservation services and related activities |
