(Tax Update) RCMD Guidelines for Logistic Services

SST on Logistic Services

We frequently receive questions from logistics clients about the Service Sales Tax (SST), such as:

Does SST apply to logistics companies?
What happens during the change from 6% to 8% tax?
What about operations in Free Zone areas?
How do you register for SST?
Which services are still taxed at 6%?

We are happy to provide the Royal Malaysian Customs Department's Guidelines for Logistics Services to help with these questions.

RCMD Guideline for Logistic Services

The Guidelines on Logistics Services provide guidance on the application of service tax to logistics services, effective 26 February 2024, covering courier services, warehousing services, customs agents, and overall logistics management.

Imposition and Scope of Tax

Any person providing logistics services is categorized as a taxable person under Group J of the First Schedule of the Service Tax Regulations 2018.

General Industry Operation

Logistics Services include delivery, distribution, or transportation of goods, documents, or packages, including using e-commerce platforms or on behalf of any person, courier services, and customs agents are categorized as taxable services under Group J of the First Schedule of the Service Tax Regulations 2018 and are subject to service tax.

Taxable Services

Logistics service providers must be registered under Section 12 of the Service Tax Act 2018 if the value of services provided exceeds the prescribed threshold.

Registration and Responsible of Registered Persons

The guideline details the registration process, threshold values, examples of taxable services, and responsibilities of registered persons, including issuing invoices and making tax payments.

Exemption From Paying Service Tax

Certain exemptions from service tax are outlined for services that meet specific criteria. Lasted update the following won’t be taxed :

Services for goods sent abroad.
Services for moving goods from one ship to another at a port.
Services for moving goods through a place without staying there.
Door-to-door delivery services.
Online delivery of food and drinks.

Transitional Issues

Transitional provisions for services that become taxable or cease to be taxable and how to handle payments received before the changes.

FAQ

Answers to common questions about registration, tax statements and payments, invoicing, and exemptions related to logistics services under the service tax.

Inquiries

For further assistance and more information on Service Tax (SST), contact details are provided.

This summary captures the essence and key points of the document, focusing on the logistics service sector's service tax guidelines in Malaysia, effective from 26 February 2024.

Source

RCMD Guideline for logistic Services (Malay)

https://mysst.customs.gov.my/assets/document/Industry%20Guides/GI/PANDUAN%20PERKHIDMATAN%20LOGISTIK%2026022024.pdf

Past Blog on SST

Logistic Sector B2B Tax Exemption https://www.ktp.com.my/blog/logistics-sector-b2b-service-tax-exemption/12mar2024

Service Tax Increase to 8% https://www.ktp.com.my/blog/service-tax-increase-to-8/29feb24

What is the new SST rate in Malaysia 1 March 2024? https://www.ktp.com.my/blog/what-is-the-new-sst-rate-in-malaysia-1-march-2024/15feb24

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