The businesses already registered with the GST don't need to register again for SST(Sales and Service Tax). Their data will be transferred to create the SST Malaysia registration. The overall registration process is straightforward as it is an online procedure.
Products charged with a tax rate of 5% are petroleum oils, construction materials, timepieces, cod liver oil, telecommunications, foodstuffs, IT, and printing materials and hardware. The tax rate for petroleum and oil are subject to high quantity-based rates.
On any taxable goods and imported taxable goods in Malaysia, a single-stage sales tax is charged by the registered manufacturers. In Malaysia the sales tax charged at 10% is the default sales tax rate.
The services include car hire, accommodation, hotel, repair rental, domestic flight, insurance, restaurants, electricity, legal accounting, telecoms, business consulting services, and digital supplies.
The main difference between zero-rated and exempted goods is that the zero-rated are taxable supplies taxed at the SST 0% rate, whereas exempted goods are non-taxable and not subject to SST.
For any listed products as zero-supplies, the company can claim an input tax credit for the materials used to build the supplies. Examples of zero-rated supplies are raw food, sugar, water, and utilities.
Click here to see Proposed Sales Tax for Various Goods.
Please note that services that are imported and exported are exempted.
However, digital services provided but foreigners to consumers in Malaysia exceeding RM 500,000 per year will have to register for Service Tax from the start of 1 January 2020.
For tax purposes, the tariff codes are required on all official shipping documents to ensure a worldwide product classification uniform.
The complete tariff code length is no less than six digits and can be up to ten also. When there are more digits in a tariff code string, the more specific it identifies the product. In the HS (Harmonised System), a series of fewer than six digits is considered a partial tariff code representing a broad category of product or chapter.
Click here to get the Tariff codes as per product classification.
Example:
31 July 2021 – Total sales value of taxable goods or services exceed the threshold
31 August 2021 – Due date for registration
1 September – Effective date to register
Note: if you are not liable from Sales Tax Order 2018, an application for exemption should be made as well through MySSM website.
As the SST can no longer be collected from the customers, business owners must pay the SST according to the due date.
A fine of maximum RM50,000 or imprisonment up to 3 years or both, can be imposed to the taxable person upon conviction.
A fine of maximum RM50,000 or imprisonment up to 3 years, or both can be imposed to the taxable person once convicted.
Note: Failure to file SST returns and Failure to make SST payment are two separate offences.
For premier offence: The taxable person can be fined up to 20 times of the Sales Tax amount and imprisonment for a maximum of 5 years, or both.
For subsequent offence: A fine of minimum of 20 times and maximum of 40 times of the Sales Tax amount can be faces by the taxable person, imprisonment up to 7 years or both.
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