Come April 2015, all Malaysian companies whose annual turnover is more than RM 500,000.00 will need to be registered as a GST registered company.
If you belong to this category of business, you will be acting as collecting agents on behalf of the Government.
Your 'duty' as a GST registrant will be to collect tax from your customers and hand over the tax collected to the Government. You can offset the tax that you pay to your suppliers from the amount you collected from your customers, and only remit the net amount to the Government.
This seemingly easy tax collection process poses a lot of challenges to the small and medium sized companies in Malaysia. If you fall into the 500k turnover category, it is best that you prepare early for the eventual implementation of Malaysian GST.
Some of challenges facing Malaysian SME's
1. Understanding GST
2. Evaluate how GST will impact every aspect of the business
3. Have a clear business process
4. Have a clear recording process
5. Insufficient internal resources for GST implementation
6. Lack of personnel with sufficient experience in GST
7. Need to invest / upgrade accounting software to capture the tax collected and paid
8. Proper documentation relating to GST
9. Need to restructure business functions within group of companies
It is best you seek the help of GST consultants to assist you if you manage a big group of companies
