ACCOUNTING

SERVICES

 

 

Why Good Accounting Practices are Important for Your Business?

Business owners and directors should be mindful of 2 very important Malaysian statutory provisions i.e.

  • Section 258 of Companies Act 2016
  • Section 77 of Income Tax Act 1967

Both laws states that it is compulsory for companies to make timely submission of financial statements (using approved accounting standards) to the regulatory bodies. Fines and penalties would be imposed for late delivery. The regulatory bodies in charge are:

1. The Companies Commission of Malaysia

All Public and Non-exempted Private limited Companies are required to lodge their   audit report and financial statements (Profit &             Loss and Balance Sheet) within 6 months from their financial year end.

2. Inland Revenue Board of Malaysia

Every type of businesses are required to lodge and file yearly tax returns that are based on accurate tax computation sourced from reliable and accurate financial statements.

Making your right choice! Our Accounting Services Helps To Take Care of Your Business!

We take great pride in being different from other accountants.

Our value-added approach involves;

  • Understanding fully our customers business and financial needs
  • Giving the right solutions to their business challenges
  • Recommending appropriate procedures to avoid potential financial pitfalls
  • Providing pro-active communication & education to our customers
  • Leveraging on our vast network of experience & qualified professionals

3. What are the Benefits of Outsourcing Accounting Services to Us?

1. Accounting Services

Financial Statements

We offer drafting of financial reports which follow the Malaysian Approved Accounting Standards and thereafter recommend audit and tax services from our pool of associate firms specializing in auditing and tax services.

Profit & Loss Statement for Year end

1.Balance Sheet &
2.General Ledger
3.Value Added Services

-Meeting, Presentation and Discussion with director(s) and /or officers to report overall business performance and provide advisory assistance.

Bank Reconciliation
This accounting tool helps to detect fraud, overdraft, and bank errors and facilitates debt collection exercises.
Budgeting
For setting company projections & goals
Cash Flow Statements & Analysis
Provides clear picture of your Company’s financial health. Monitoring cash in and cash out can help you make better decisions before it is too late.
Financial Consulting & Analysis
For assisting management in planning, controlling & decision making. We also make sure that companies will not be missing out from maximizing their tax savings derived from a wide range of tax incentives available such as tax exemptions, tax deductible expenses, tax reliefs or even expenditures that qualify for double deduction.
Liaise with Bankers for banking facilities
Business Correspondence & meeting. Involves evaluating business performance for bankers & investors’ reference to obtain funds or loans.
Advisory Service to Directors on compliance of regulations
To avoid late penalty fines from the Companies Commission of Malaysia and the Inland Revenue.

2. Registration & Payroll Services

Payroll Process

The sourcing of manpower is a requirement before the commencement of business operations. This is followed by the payroll process,

Payroll Process.

After recruitment of workers, the initial stage of the payroll process requires compulsory registrations of the new company with some semi-government regulatory bodies.

Its purpose is to determine the value of monetary contributions that would have to be deducted out from the monthly wages of the workers and accordingly to be sent to the respective regulatory bodies. (Please refer to the table below for further explanation).

Regulatory Body Items to deducted from employee’s salary
Employees’ Provident Fund (EPF)
  • EPF is a compulsory semi government led savings scheme for local employees
  • An employee contributes 8% of his wage to EPF, while the employer makes another contribution of 13% based on the employee’s salary level
Social Security Organisation (SOCSO)
  • SOCSO is a compulsory social security protection scheme for Malaysian employees earning a monthly wage of RM3,000 and below
Income Tax PCB
  • PCB income tax deduction mechanism from an employee’s monthly remuneration (salary) intended to reduce the employee’s burden to pay in one lump sum when the actual tax amount is ascertained
Human Resource Development Fund (HRDF)  

  • Applicable for Manufacturing sectors, employers with fifty or more employees and employers with ten or more but less than fifty employees and with a paid-up capital of (RM2,500,000) and above are required to register.

 

  • Applicable for Service sectors, employers with ten or more employees and employers with fifty or more employees are required to register with HRDF Department

 

  • A HRD levy is imposed on the Employer at the rate of one per centum (1%) of the monthly wages of the employees & to be paid to HRD

At the initial stage of business operations, your new set-up may not have qualified and experienced manpower resources support to carry out human resource / payroll work.

Hence outsourcing of this service would be your best solution to save you time and money.

Initial Registration
  • Employees Provident Fund (“EPF”) (pdf)
  • Social Security Organization (“Socso”) (pdf)
  • Inland Revenue Board
  • Human Resource Development Fund (“HRDF”) – if relevant
Monthly Payroll Exercise
    • The calculation of EPF, Socso & Tax contributions
    • Calculation and payment of employees’ monthly wages
    • Timely & Mandatory payment of EPF & Socso contributions; along with employees’ tax payments (PCB) to the respective government agencies. See PCB Table 2013 (pdf)
Yearly Payroll Exercise
  • Preparation of Form E to Inland Revenue Board
  • Preparation of EA Forms for employees

3. GST Accounting Services

What is GST ?

Goods and Services Tax (GST) was first introduced in Malaysia on 1st April 2015 in order to replace the previous Sales and Services Tax. The Malaysian Customs Department is the government agency tasked to collect the tax.

It is a multi-stage domestic consumption tax on goods and services, and paid when money is spent at every stage of the retail chain i.e.  Importation / manufacture, distribution and finally retailing of goods or services.

The Terminologies

Output Tax is the tax charged and collected on behalf of the Malaysian Customs Department by all GST registered businesses to its customers

Input Tax is the tax that the business had paid on the purchases on goods and services for the purposes of doing business

One pertinent point to note is that all GST registered businesses are entitled to claim refunds from the government by way of deducting Input Tax against the Output Tax to arrive at a net amount of GST that needs to be paid or refunded.

 GST Rates

The supply of Goods and Services are either taxable or exempted.  They are classified as either “standard rated” or “zero rated” items.   At “standard rate”, GST is at 6% whereas in “Zero-rating” a supply, GST is applied at 0% for the transaction

Registration on GST

All businesses fall within the scope of GST, and they are specifically classified as zero rated, exempt or out of scope. However upon reaching an annual revenue RM500K, it becomes mandatory for all businesses to register for GST.

For those that fall below those prescribed threshold, they could voluntary apply to register whereas for those that exceeded this amount, it becomes mandatory to register. Failure to register would attract heavy fines & penalties.

Preparation & Filing GST Returns

Businesses are required to submit the GST returns in Form 3 (“GST-03”)

The frequency of filing depends on the amount of the company’s annual turnover. For annual turnover below RM5 million, the frequency of filing is quarterly.

As for those companies that has annual turnover of above RM5 million, the filing frequency will increase to monthly.

The deadline for filing is the last day of the month following the taxable period. For example, if the taxable period is January to March, then the deadline for filing and GST payment shall be 30th April.

Advisory on Record Keeping

GST records must be kept for 7 years.  Listed below are the important ones:-

 

  • Supporting documents for goods supplied or received
  • Import & Export documents
  • Contracts and quotations showing GST Liabilities
Penalties
Type Fines / Imprisonment
Late Payment of GST 5% if within 30 days

Additional 5% after 30 days but not exceeding 60 days

Additional 3% for every subsequent 30 days or part thereof

Also subject to a maximum tax of 25% of the late payment penalty

Incorrect Return Not exceeding RM50k or imprisonment not exceeding 3 years or both
General Not exceeding RM30k or imprisonment not exceeding 2 years or both