Special-GST Treatment: Non-deductible Expenditure

From eStream Software

How to enter and to retrieve the non-deductible expenditure?


Introduction

This guide will teach you the way to key-in the data entry and help you to analyse the non-deductible expenditure related to GST. It is follow to the latest 2015 amendment in Income Tax Act 1967.

GST Expenditure (Effective from YA 2015)
1. para 39(1)(o): GST input tax paid or to be paid not allowed as deduction if:-

a. Non-registered person with turnover exceed GST threshold of Rm500,000.
b. Registered person fail to claim input tax credit his entitled to claim.

2. section 39(1)(p): Output tax absorbed by GST by registered person is not allowed as tax deduction.
3. GST block input tax & deductible expenses:-

Block Tax GST input Tax Tax deductible?
Passenger car (Cost and maintenance) Blocked Deductible (to claim capital allowance)
Club subscription fee Blocked Non-deductible
Medical insurance/personal accident insurance Blocked Deductible
Family benefits Blocked Depend (check with your auditors or tax consultant)
Entertainment expenses (Potential customer) Blocked Non-deductible
Entertainment expenses (Supplier) (p Blocked Allowed 50% deduction






































Subject to GST:
FIZ Local sell to FIZ Local → SR
FIZ local sell to LMW Local → SR
FIZ/LMW local sell to non-FIZ/LMW → SR
FIZ/LMW Local sell to Oversea → ZR

For example,

Item Item Description Qty Unit Price
(RM)
Value(RM) Import Duty
(RM)
1. Shirts 300 pcs 25.00 7,500.00 1,500.00
2. Paints 100 pcs 30.00 3,000.00 600.00
Total 10,500 2,100.00


Assuming 20% import duty (RM10,500 x 20% = 2,100.00)

GST on value + Import Duty are subject to GST (SR) = (10,500.00 + 2,100.00) x 6% = 756.00


Therefore, the Tax Invoice will be presented as per below:

Item Item Description Qty Unit Price
(RM)
Value
(RM)
1. Shirt 300 pcs 25.00 7,500.00
2. Paints 100 pcs 30.00 3,000.00
GST (SR-6%) 756.00
Total Amount Payable 11,256.00

How to enter the Tax Invoice if there is a FIZ/LMW transactions to another party?

[Sales | Invoice...]

According to the example mentioned in above.
1. Insert and select the stock items sold with empty tax code. Because the stock items are under FIZ/LMW control.

Item Code Description Qty Unit Price Subtotal Tax Code Tax Amount SubTotal(Tax)
SHIRT SHIRTS 300 pcs 25.00 7,500.00 <BLANK> 0.00 7,500.00
PAINTS PAINTS 100 pcs 30.00 3,000.00 <BLANK> 0.00 3,000.00

2. Inser new row and enter the GST on total supply value (Rm7500 + Rm3000 = Rm10,500) direct into Taxable Amount column (C1)

Description Taxable Amount Tax Code Tax Amount SubTotal(Tax)
GST on value Rm10,500.00 10,500.00 SR 630.00 630.00

440PX


NOTE : 
A1 : Key-in "GST on value" into description.
B1 : Must select tax code.
C1 : Key-in the Total Supply Value into Taxable Amount.


3. Insert new row and enter the GST on total Import Duty (Rm1,500 + Rm600.00 = Rm2,100) direct into Taxable Amount column (C2)

Description Taxable Amount Tax Code Tax Amount SubTotal(Tax)
GST on Import Duty 20% 2,100.00 SR 126.00 126.00

440PX


NOTE : 
A2 : Key-in "GST on Import Duty" into description.
B2 : Must select tax code.
C2 : Key-in the Total Import Duty value into Taxable Amount.


GST Return

[ GST | New GST Return...]

1. Process GST Return for the month
2. Click on print GST-03

240PX


RESULTS : 
5a Total value of supplies = 12,600.00
5b total output tax = 756.00


See also