COVID 19 – Tax Developments

Following from the extension by the government of the Movement Control Order (“MCO”) until 14 April, 2020, the Inland Revenue Board (“IRB”) has updated the list of Frequently Asked Questions (“FAQ”) released earlier. 

Salient Points

We have listed the salient points from the updated FAQ. 

Stamp Duty Counters Now Operational 

Stamp duty counters at each branch Stamping Office (as well as the Hasil Care Line) are now operational from 8 a.m. to 12 noon, Monday to Friday (Sunday to Thursday for Kedah, Kelantan, Terengganu and Johor), to cater to individual duty payers. However, stamp duty counters at Revenue Service Centres and Johor Bahru UTC will remain closed until the end of the MCO.

The services available will be limited to stamping for individuals and those who do not have a STAMPS user ID and to payment of stamp duty on notices of assessment, which cannot be made online.

Duty payers other than individuals may submit stamping applications and make payment online through STAMPS at: https://stamps.hasil.gov.my

If payment is due in the period of 18 March, 2020 to 14 April, 2020, the payment can

be made on or before 30 April, 2020. No late payment penalty will be imposed.

All other IRB premises throughout the country remain closed until 14 April, 2020.

Taxpayers now required to apply for an Extension of Time to Make an Appeal

Extension of time will be granted for filing of Form Q (Notice of Appeal), where the last date to file the Form Q falls within the MCO period. However, taxpayers are now required to file the Form N (Application for Extension of Period for Making an Appeal to The Special Commissioners of Income Tax) and state that the delay is due to the implementation of MCO.

Previously, the IRB announced that taxpayers were not required to apply for an extension of the period to make an appeal.

Extension of Time until 30 April, 2020 for Submission and Payment of Tax Estimates etc.

An extension of time until 30 April, 2020 is now given for each of the following:

  1. submission of tax estimates (CP204) that are due from 18 March, 2020 to 14 April, 2020;
  1. payment of tax estimates that are due on or before 15 April 2020;
  1. submission of revised tax estimate in the third month instalment that falls in April, 2020; 
  1. submission of notification of change in accounting period (Form CP204B) that is required to be submitted in the period of 18 March, 2020 to 14 April, 2020
  1. submission of return form and payment by any Labuan entity that are due during the period of 18 March, 2020 to 14 April, 2020;
  1. submission of Monthly Tax Deductions (MTD) data and MTD/CP38 payment for March, 2020 remuneration;
  1. compound payment for MTD that should be paid during the period of 18 March, 2020 to 14 April, 2020;
  1. submission of documents for audit or investigation that are required to be submitted within the period of 18 March, 2020 to 29 April, 2020;
  1. provision of feedback to IRB letters that is required to be done within the period of 18 March, 2020 to 29 April 2020;
  1. furnishing of real property gains tax returns and payment of real property gains tax that are due within the period 18 March, 2020 to 30 April, 2020.

Further Extension of Time for Filing Country-by-Country Report and Notification

Country-by-country reports due on 31 March, 2020 or 30 April, 2020 can now be submitted on or before 15 May, 2020. 

Also, any notification required to be submitted on 31 March, 2020 or 30 April, 2020 can be submitted on or before 15 May, 2020.

Automatic 3-month Deferment of CP204 Payment for SMEs

As announced by the Prime Minister in the Economic Stimulus Package, all types of businesses with Small and Medium Enterprise (SME) status are now eligible for deferment of CP204 payment for 3 months beginning April, 2020 until June, 2020.

SMEs are those with a paid-up capital of less than or equal to RM 2.5  million at the beginning of the basis period for a year of assessment and a gross business income of RM 50 million and below.

The deferment will be given automatically to all SMEs based on IRB’s record.

Automatic 6-month Deferment of CP204 Payment for Companies related to the Tourism Industry

Companies related to the tourism industry (including those with SME status) are eligible for deferment of CP204 payment for 6 months beginning April, 2020 until September, 2020.

The deferment will be given automatically based on IRB’s record.

CP500 Payment Can be Deferred

Payment for CP500 can be deferred starting from April, 2020 to June, 2020. The months eligible for deferment are March, 2020 and May, 2020.

CP500 Revision is Allowed

Taxpayers are also allowed to revise CP500 on or before 30 June, 2020.

No Tax Increase 

Tax increase will not be imposed if an income tax payment, which should be made during the period between 18 March, 2020 and 14 April, 2020, is made on or before 30 April, 2020.

Further, companies / businesses that qualify for deferment of CP204 / CP500 payment will not be subject to tax increase.

Tax Payment of over RM 1 million through Telegraphic Transfer

Any tax payment of over RM 1 million can be made through telegraphic transfer (TT). However, the taxpayer needs to submit the payment details to IRB via fax at 03-62019637 or e-mail at: [email protected] 

Further Extension of Time for Payment of Withholding Tax

Payment of withholding tax that is due between 18 March, 2020 and 14 April, 2020 can now be made from 15 April, 2020 up to 30 April, 2020. 

Payment can be made via telegraphic transfer. 

Taxpayers are required to furnish complete payment details to IRB via fax at 03-62019637 or e-mail at: [email protected]

No penalty will be imposed on late payments during this period.

Tax Refunds Now Processed as Usual

Tax refunds will now be processed as usual.

Submission of Employer Notifications

Forms CP21 (Notification by Employer of Employee’s Departure from Malaysia), CP22 (Notification of New Employee), CP22A (Notification of Cessation of Employment (Private Sector)) or CP22B (Notification of Cessation of Employment (Government Agency)) can now be submitted starting from 15 April, 2020 rather than 1 April, 2020, as previously announced.

Further Delay to Processing of Applications for Tax Clearance Letter

An application for a tax clearance letter can still be done via e-SPC at any time or at the IRB office starting from 15 April, 2020. 

However, processing of applications will only start from 15 April, 2020.

Please do not hesitate to contact any of the following persons from our Tax Practice Group if you require any clarification:

Vijey M. Krishnan (Partner) 
(T): 603 – 2632 9868
(E): [email protected]

William Wong (Partner)
(T): 603 – 2632 9905
(E): [email protected]

Nicholas Mark Pereira (Senior Associate)
(T): 603 – 2632 9911     
(E): [email protected]

Krystal Chiam (Associate)
(T): 603 – 2632 9999 (ext. 1201)
(E):  [email protected]

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