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Administrative Changes to The Submission of 2% Withholding Tax From Payments To ADDs

During the tabling of the National Budget 2022, the Government of Malaysia has introduced a new Section 107D to the Income Tax Act 1967 (“ITA”). Companies are responsible to withhold and remit withholding tax in respect of monetary payments made to resident individual agents, dealers or distributors (“ADD”). Click here to refer the previous announcement.

 

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1. The payer company is required to deduct the 2% tax from payments to ADDs for every transaction on an accumulated basis by month.

2. The above - mentioned 2% tax deduction amount is required to be remitted to HASiL latest by the end of the following month.

 

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3. The payer company must complete the latest Form CP107D - Pin 2/2022 in PDF format and Appendix CP107D(2) in excel format and submit them via email to the payment centres as listed below before making the payments. This email submission is necessary for payments made via payment counters or post. The respective email addresses of the payment centres are as follows:

 

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If the above - mentioned email submission is sent to the Kuala Lumpur Payment Centre, payment can be made at the Kuala Lumpur Payment Centre only.

4. A copy of the email submission sent to HASiL’s payment centres must be presented by the payer company for verification and checking purposes when making payment at the payment centres, before the receipt is issued.

5. Ensure that the number of recipients, the amount of the 2% tax deduction and the cheque number in the Form CP107D - Pin 2/2022 and Appendix CP107D (2) are the same and accurate.

6. Before filling out the Appendix CP107D(2), the payer company needs to ensure that the recipient has an income tax number. If the recipient does not have an income tax number, registration may be made online through e - Register at https://edaftar.hasil.gov.my/.

 

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Reference:

1. HASiL Media Release - Administrative changes to submission of 2% tax deducted by payer companies from payments to agents, dealers or distributors.

2. Form CP107D - Pin 2/2022

3. Appendix CP107D(2) -
(inExcel_https://www.hasil.gov.my/en/forms/download-forms/downloadformwithholdingtax/?subKategoriCukaiPegangan=Semua&tahun=Semua)

 

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Author(s)

Norzila Othman
Senior Manager,

Tax


Hartini Md isa
Senior Manager,

Tax


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