GST : Full of Surprises

GST is full of surprises where some part of the notes not being highlighted such as the following :-

a) Guide on Input Tax 27.10.2013

Where a registered person fails to pay the consideration for the supply of any goods or services made by his supplier within six months from the date of supply and he has claimed input tax on that supply, the taxable person is required to pay back the input tax by accounting an amount equal to the input tax as his output tax. Claim input tax if subsequently pays supplier.

b) Guide on Transitional Rule 21.02.2014. Who pay the GST?

If there is a continuous supply of goods or services spanning the GST commencement, only the portion of supply made before 1 April 2015 is not subject to GST. The proportion of supply made on or after 1 April 2015 is subject to GST.

For example,
After entering into a deal to build a RM1,340,000 commercial complex, a written S&P was signed in January 2015. On 15 May 2015, the purchaser requests that the flooring on the 2nd level to be upgraded to hardwood. The amount payable for the upgrade is not included in the written agreement. The charge for the upgrade by the builder is RM140,000. The ownership and possession will be transferred on 30 September 2015. The upgrade activity is a separate supply from the S&P signed. The builder issues a separate invoice for the upgrade RM140,000 on 20 May 2015 to the
purchaser and he pays the amount the following day.

c) Guide on Transitional Rule 21.02.2014. Contract if less than 2 years? Who Pay GST?

The provision of goods and services under a reviewable contract entered into no less than two years before 1 April 2015 can only be zero-rated until its first opportunity after that date for review or for a period of five years after 1 April 2015, whichever is the earlier.

A ten year business supply contract was made on 1 January 2013 and provides for a market review to be made every five years. If the review is to be made every five years i.e. 1 January 2018, supplies made from 1 April 2015 till 31 December 2017 will be zero rated and supplies made from 1 January
2018 will be subject to GST at a rate of 6%.

d) Guide on Transitional Rule 21.02.2014. Construction Agreement before 01.04.2015? Who Pay GST?
Valuation is needed after 01.04.2015 to calculate GST chargeable, or else the whole amount of contract amount would be subject to GST even agreement sign before GST. 

e) Guide on Register for GST Amend1. Every Company is remained registered minimum 2 years?

f) GAF contains all General Ledger includes Customer Information, Supplier Information, Banks, Profit & Loss Accounts to send forward to Custom when GST submission?

g) GST Refundable 14 days if submit Online?
For companies which are making yearly profit without having any export sales, this scenario would not ever happen, as every company is a net payable tax. But why Custom is saying 14 days is very efficient whereby 90% audience is not applicable?

h) Keeping 7 Years Accounting Record?
Seven (7) years record similar with the Income Tax requirement. Actually there are three (3) people are using these records, Income Tax, GST, and Kementerian Perdagangan Dalam Negeri, Koperasi dan Kepengunaan (KPDNKK). We might expect everyone from the authority would be using these seven (7) years of record.

i) After Individual GST registration, what next?

One might confuse that once register GST, everything is done properly. Studying it carefully, Group registration is at 2nd stage, Cash Basis instead of Invoice Basis, Simplified Tax Invoice, Special Scheme, E-voucher and etc... need some approval or registration. 31.12.2014 is the last day for GST registration, and penalty awaits 01.01.2015 onwards. The reason given is to make everyone ready for it which is 3 months before 01.04.2015 which everyone would shock that (3) months less if compare with the GST implementation date.

j) What comes first before De-Registration take place?
If there are no sales for a particular taxable period, companies are still required to submit a NIL return, i.e. to fill in ‘zero’ in the respective column.


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