To Our Valued Clients
Under the PEMERKASA Stimulus Package announced by the Government on 17th March 2021, it was proposed that deferment of tax instalments be granted to companies in the tourism and selected industries (e.g. cinema and spa). In relation to this, the Inland Revenue Board ["IRB"] has issued the Frequently Asked Questions ["FAQ"] - Deferment of Payment of Estimated Tax Payable (CP204) and Instalment Scheme (CP500) from 1st April 2021 to 31st December 2021 under PEMERKASA.
Salient points of the FAQ are as summarised below:-
| i. |
The deferment of payment applies to tax instalments under CP204 and CP500 that fall due during the period from 1st April 2021 to 31st December 2021 ["the deferment period"]. |
| ii. |
Eligible taxpayers are those who conduct business activities under the tourism, cinema and spa industries identified based on the business codes stated in the latest income tax return form ["ITRF"] submitted to the IRB. The list of qualifying business codes is as provided in item 3 of the FAQ. |
| iii. |
The taxpayers under the tourism, cinema and spa industries will continue to qualify for the deferment of payment even though they are involved in other businesses. |
| iv. |
The deferment of payment will be given automatically to all eligible taxpayers determined based on the IRB's records. No application needs to be made. |
| v. |
The instalment payments deferred are not required to be paid after the deferment period. Upon submission of the ITRF for the relevant year of assessment, any balance of tax payable will then be settled by the taxpayers. |
| vi. |
No penalty will be imposed by the IRB on the instalments due during the deferment period. |
| vii. |
The eligible taxpayers can choose to decline the offer for deferment of payment and continue with the payment of tax instalments per the CP204 or CP500 without having to inform the IRB. |
| viii. |
The IRB will issue a notification to the eligible taxpayers of the deferment of tax instalment via email. Those eligible taxpayers who have not received the emails are not required to make the payments for the instalments during the deferment period. |
| ix. |
A taxpayer can make an appeal if it is found to be eligible for the deferment based on its current status. |
| x. |
Taxpayers are allowed to apply for revision of CP204 tax estimate in the 6th and/or 9th month of the basis period that falls within the deferment period, or in the case of CP500 instalment, by 30th June 2021. |
| xi. |
For the purpose of computing under-estimation penalty under Section 107C(10) of the Income Tax Act 1967, it shall be ascertained based on the original estimated tax amount, if no revision is made in the 6th and/or 9th month of the basis period. |
For further information on the deferment of payment of tax instalments, kindly refer to our email dated 5th April 2021 on PEMERKASA Stimulus Package.
Please do not hesitate to contact us if you need clarification on the foregoing.