20140805 GST Awareness Session for Vendor BGR

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GST in Malaysia

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<p>PowerPoint Presentation</p> <p>1</p> <p>Goods and Services Tax (GST) Awareness Session for Vendors</p> <p>Bangi Golf Resort5th August 20141Agenda</p> <p>No.AgendaSlides No.1.Goods and Service Tax (GST) Overview32.GST Registration73.5 Important Points for Vendors82What is Goods and Services Tax (GST)A broad-based consumption tax on goods and services in Malaysia</p> <p>Proposed start date of 1st April 2015Sales Tax and Service Tax will be repealedApplicable GST rate - proposed to be 6%Proposed threshold - RM500,000Imposed on money spent, not earnedCertain goods and services to be exemptedTransaction based, a multi-stage tax applied at each stage of the production and distribution processAllows offset of input tax against output tax</p> <p>Page #Sale price (Before GST)SupplierSale price = 424 (inclusive of GST)ManufacturerSale price = 1,060 (inclusive of GST)</p> <p>Local consumerPayment to Manufacturer = 1,060</p> <p>Payment to GST Authority Manufacturerprice = 1,000Supplier price = 400GST @ 6%By SupplierOutput tax 24Less: Input tax - GST payable24 By Manufacturer Output tax60 Less: Input tax 24 GST payable 36GST paid by consumer = 60Multi-stage tax collection and paymentPage #2014 Budget Seminar4How does GST workGST is charged on, any taxable supply of goods and services, by a GST registered person in Malaysia and is called OUTPUT TAXGST is recovered on your purchases used for the purpose of making a taxable supply in the course or furtherance of business and is called INPUT TAX</p> <p>Types of supplies</p> <p>1. Standard rated Taxable Supplies (apply to most goods and services)</p> <p>2. Zero rated Taxable Supplies (applicable to exports and sale of essential goods) 3. Exempt No GST (Input tax not recoverable)</p> <p>4. Out-of-scope No GSTInput tax recoverablePage #</p> <p>Types of suppliesPage #GST RegistrationMandatory RegistrationVendors who make taxable supplies and annual revenue turnover above the prescribed threshold (RM500,000.00 per year).Registration will be opened 6-month before GST implementation date.</p> <p>Voluntary RegistrationHowever, vendors can choose to register voluntarily even though their annual revenue turnover below the prescribed threshold (RM500,000.00 per year).</p> <p>Liabilities to register are determined by:Historical Turnover (based on turnover exceeds the threshold in the past 12 months); ORFuture Turnover (based on turnover exceeds the threshold within the future 12 months)7Hanya perniagaan yang mempunyai jualan tahunan (threshold) RM500,000 setahun dikenakan GST. Perniagaan itu mesti berdaftar dengan Jabatan Kastam. Mereka tidak boleh lari. Contohnya, kedai mamak yang jual nasi kandar, jika jualan tahunannya RM500,000, baru boleh kenakan GST enam peratus kepada pelanggannya75 Important Points for VendorTo ensure smooth operation of TNB after the GST is implemented, vendor needs to take note on the followings:</p> <p>8Hanya perniagaan yang mempunyai jualan tahunan (threshold) RM500,000 setahun dikenakan GST. Perniagaan itu mesti berdaftar dengan Jabatan Kastam. Mereka tidak boleh lari. Contohnya, kedai mamak yang jual nasi kandar, jika jualan tahunannya RM500,000, baru boleh kenakan GST enam peratus kepada pelanggannya81. Responsibility as TNBs GST Registrant Vendors</p> <p>As a GST registered vendor under GST regime, you are entitled to:Collect GST (Output Tax) through the sales of goods and services that you made to your customers. Pay GST (Input Tax) on the purchase of goods and services to your suppliers. Pay GST (Input Tax) to Royal Malaysian Customs Department (RMCD) for the importation of goods into Malaysia.</p> <p>9Hanya perniagaan yang mempunyai jualan tahunan (threshold) RM500,000 setahun dikenakan GST. Perniagaan itu mesti berdaftar dengan Jabatan Kastam. Mereka tidak boleh lari. Contohnya, kedai mamak yang jual nasi kandar, jika jualan tahunannya RM500,000, baru boleh kenakan GST enam peratus kepada pelanggannya9Once registered, you are required to submit to TNB the followings:GST registration number; andGST registration certificate/document as proof of registration. This is to allow TNB to record your GST registration number in its database.</p> <p>101. Responsibility as TNBs GST Registrant Vendors (continue)Hanya perniagaan yang mempunyai jualan tahunan (threshold) RM500,000 setahun dikenakan GST. Perniagaan itu mesti berdaftar dengan Jabatan Kastam. Mereka tidak boleh lari. Contohnya, kedai mamak yang jual nasi kandar, jika jualan tahunannya RM500,000, baru boleh kenakan GST enam peratus kepada pelanggannya10Kindly inform TNB if you have deregistered or your GST registration is cancelled. All with documentary evidences must be provided as well. </p> <p>This will allow TNB to change your business entity status in our database from GST registered to Non-GST registered. </p> <p>Once deregistered, you are not allowed to charge GST (input tax) on supplies made to TNB and also you are not required to issue a tax invoice/debit note/credit note showing GST components.</p> <p>112. DeregistrationHanya perniagaan yang mempunyai jualan tahunan (threshold) RM500,000 setahun dikenakan GST. Perniagaan itu mesti berdaftar dengan Jabatan Kastam. Mereka tidak boleh lari. Contohnya, kedai mamak yang jual nasi kandar, jika jualan tahunannya RM500,000, baru boleh kenakan GST enam peratus kepada pelanggannya113. Tax InvoiceTAX INVOICE</p> <p>A GST registered vendor must provide a valid Tax Invoice to TNB. </p> <p>The Tax Invoice can either be a Full Tax Invoice or a Simplified Tax Invoice depending on the value of the supplies but both must be in the format required by RMCD. </p> <p>Both types of Tax Invoice will allow TNB to claim input tax credit (ITC). </p> <p>1212</p> <p>13DEBIT NOTE AND CREDIT NOTE</p> <p>Debit Note and Credit Note must be issued if the price in a previously issued Tax Invoice has been increased or decreased and the GST charged previously needs to be adjusted accordingly. </p> <p>Under the GST regime a Debit Note and a Credit Note needs to be issued when the consideration for a previous supply changes. </p> <p>All tax invoices, debit notes and credit notes must be in the RMCD prescribed format. </p> <p>3. Tax Invoice (Continue)13</p> <p>14Example of Tax Invoice Full Tax Invoice15Tax UnitGroup Finance DivisionExample of Tax Invoice Simplified Tax Invoice</p> <p>4. PricingUnder the GST regime:There will be no sales tax or service tax charged on supplies made to TNB by vendors from 1st April 2015 onwards.</p> <p>Savings and/or cost reductions may be passed on by vendors to TNB as you will save on sales and services tax (if any) from existing contracts with TNB that straddle 1st April 2015.</p> <p>Prices for the same supplies made after 1st April 2015 should be relatively cheaper as sales and services tax will be abolished and should not form part of the pricing component.</p> <p>You will pay GST on good and services supplied to you and you will seek to charge GST in your prices for supplies made to TNB from 1st April 2015 onwards.</p> <p>16165. Contract spanning 1st April 2015</p> <p>All pre- GST contracts that spanning on/after 1st April 2015 entered into between the vendors and TNB are treated in the following manner under the proposed GST Law:All contracts that are entered into after 1st April 2013 will be standard rated.</p> <p>All contracts that are entered into before 1st April 2013 with an opportunity to review will be standard rated after 1st April 2015.</p> <p>All contracts that are entered into before 1st April 2013 for a fixed price with no opportunity to review will be zero-rated for 5 years until 31st March 2020 or until the first opportunity to review takes place whichever is earlier.</p> <p>1717</p> <p>18</p>