FAQs on the Deferment of Payment of CP204 and CP500

Frequently Asked Questions on the Deferment of Payment of Estimated Tax Payable (CP204) and Instalment Scheme (CP500) from 1 April 2021 to 31 December 2021

In the Strategic Programme to Empower the People and Economy (PEMERKASA) which was announced on 17 March 2021, it was proposed that to ease the burden and support the recovery of the tourism and other affected sectors, companies in the tourism industry and selected industries (e.g. cinemas and spas) would be allowed to defer their monthly tax instalment payments which are due between 1 April and 31 December 2021 (see Special Tax Alert No. 2/2021).

Following the above, the IRB has published on its website a document titled “Frequently Asked Questions on Deferment of Payment of Estimated Tax Payable (CP204) and Instalment Scheme (CP500) from 1 April 2021 to 31 December 2021 under ‘Program Strategik Memperkasa Rakyat Dan Ekonomi’ (PEMERKASA)” (FAQs on the Deferment of Payments) dated 9 June 2021.

Some of the key points are outlined below.

• The deferment of CP204 and CP500 instalment payments will apply to taxpayers carrying on business activities in the tourism, cinema and spa industries.

• The deferment is provided automatically to eligible taxpayers who are identified based on the business code stated in their latest income tax return form submitted to the IRB.

• Taxpayers who are eligible based on their current status (but did not qualify previously) may submit an appeal to the IRB.

• Taxpayers who qualify for the deferment may opt to continue remitting their instalment payments per the original instalment schedule without the need to notify the IRB.

• The instalment payments that have been deferred will only need to be settled upon submission of the income tax return forms for the relevant YA, in cases where there are any outstanding tax payable amounts.

• Increase in taxes for late payment of tax instalment payments will not be imposed during the period of deferment.

Further details are set out in Appendix II to this Alert. The FAQs on the Deferment of Payments also provide examples to illustrate the mechanism for the deferment of the payment schemes.

The FAQs are available at the following link:

Frequently Asked Questions on Deferment of Payment of Estimated Tax Payable (CP204) and Instalment Scheme (CP500) from 1 April 2021 to 31 December 2021 under ‘Program Strategik Memperkasa Rakyat Dan Ekonomi’ (PEMERKASA)

                                                                                                                                                                                                      APPENDIX II

Frequently Asked Questions on Deferment of Payment of Estimated Tax Payable (CP204) and Instalment Scheme (CP500) from 1 April 2021 to 31 December 2021 under ‘Program Strategik Memperkasa Rakyat Dan Ekonomi’ (PEMERKASA)