Besides lodging the audited accounts and annual return of the company, there are other important compliance requirements too, in particular the Goods and Services Tax (GST) Act. GST is a consumption tax and replaces the Sales and Service Tax. All businesses that generate revenue above the RM500,000 threshold are within the GST scope, unless they are exempted or out-of-scope. Companies must submit GST return, which is also referred to as Form 3. It is imperative to comply with the GST returns and payment to avoid the corresponding penalties as mandated in the Malaysian law. A reliable and credible accounting services company particularly could help you with your Goods and Services Tax returns and payment.
With regards to GST compliance, here are the penalties and offences:
- General Offence – Fine will not exceed RM30,000 or imprisonment of not more than two years or BOTH.
- Incorrect Return – Fine will not exceed RM50,000 or imprisonment of not more than 3 years or BOTH. The penalty is also equal to the undercharged GST.
- Late GST Payment – Penalty is 5% within 30 days and an additional 5% after 30 days yet not exceeding 60 days. An additional 3% is imposed for the following 30 days . A 25% maximum tax is imposed on late payment.
Besides the above, companies are required to comply with the Income Tax Act 1976 in relation to income tax compliance. Under Section 112 (1), failure to file income tax return may incur a penalty of up to RM2,000, while under Section 103 (4) late payment of income taxes will incur a 10% penalty on the tax payable, with an additional 5% incremental penalty if payment is not made within 60 days from the due date.
Search for a reputable accounting services firm to help you get more information how to properly and promptly register your annual return, and make your tax filing and payment before the due date.