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Standard Rated

  • A GST registered supplier must charge and account GST at 6% for all sales of goods and services made in Malaysia unless the supply qualifies for zero- rating, exemption or falls outside the scope of the proposed GST model.
  • The GST collected from customer is called output tax.
  • The value of sale and corresponding output tax must be reported in the GST returns.



Zero Rated Purchase

  • A GST registered supplier can zero-rate (i.e. charging GST at 0%) certain local supply of goods and services if such goods or services are included in the Goods and Services Tax (Zero Rate Supplies) Order 20XX.
  • Examples includes sale of fish, cooking oil.



Zero Rated Exportation Supply

  • A GST registered supplier can zero-rate (i.e. charging GST at 0%) the supply of goods and services if they export the goods out of Malaysia or the services fall within the description of international services.
  • Examples includes sale of air-tickets and international freight charges.



Incidental Exempt Supplies

  • This is only applicable to GST registered trader that makes both taxable and exempt supplies (or commonly known as partially exempt trader).
  • This refers to exempt supplies made under incidental exempt supplies.
  • Incidental Exempt Supplies include interest income from deposits placed with a financial institution in Malaysia, realized foreign exchange gains or losses, first issue of bonds, first issue of shares through an Initial Public Offering and interest received from loans provided to employees also include factoring receivables, money received from unit holders for units received by a unit trust etc.



Deemed Supplies

  • GST is chargeable on supplies of goods and services.
  • For GST to be applicable there must be goods or services provided and a consideration paid in return.
  • However, there are situations where a supply has taken place even though no goods or services are provided or no consideration is paid. These are known as deemed supplies.
  • Examples include free gifts (more than RM500) and disposal of business assets without consideration.



Out of Scope Supplies

  • This refers to supplies (commonly known as out-of-scope supply) which are outside the scope and GST is therefore not chargeable.
  • In general, they are transfer of business as a going concern, private transactions, third country sales (i.e. sale of goods from a place outside Malaysia to another place outside Malaysia).



Exempted Supplies

  • This refers to supplies which are exempt under GST.
  • These supply include residential property, public transportation etc.



Relief Supply

  • This refers to supplies which are supply given relief from GST.



Disregarded Supplies

  • This refers to supplies which are disregarded under GST.
  • These supplies include supply within GST group registration, sales made within Warehouse Scheme etc.



Output Tax Adjustment

  • Any adjustment made to Output Tax, Example such as longer period adjustment, bad debt recovered, outstanding invoices more than 6 months & other output tax adjustments.

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