Correct errors in GST reports now, SMEs told

KUALA LUMPUR: With today marking Malaysia’s one year of GST implementation, an accounting firm has advised Small and Medium Enterprises (SMEs) to start looking through their reports for errors and correcting them to avoid trouble from the Customs Department.

According to YYC Advisors managing partner Yap Shin Siang, many business owners were still having trouble coping with the reporting system.

Speaking at a forum here earlier this week, she said she had found that at least 80 per cent of her 1,000 SME clients made mistakes in their GST reports.

“You have to remember that GST is transaction based, which means that it is applicable to every single transaction,” she said. “Because it is so complex, it becomes common to make mistakes.”

She said the most common mistake that SMEs made was to claim input tax based on improper invoices.

Input tax is tax that a business owner is allowed to reclaim from the supplier under certain conditions as long as the former holds a tax invoice for the goods or services received.

Yap said it was important for SMEs to start revising their GST reports now and to correct errors because the Customs Department was in the process of forming a team to audit GST compliant companies.

“Currently there are 400,000 companies that have registered to be GST compliant and it’s better that they find their own mistakes before the Custom’s Department does,” she added.

When asked why prices had not gone down although the amount charged in GST is 4 per cent lower than the Sales and Service Tax of 10 per cent, Yap said many companies were still selling old stocks.

“They were allowed to apply for a special refund of 4 per cent for their old stocks after the GST was implemented, but more than 50 per cent of my clients have told me that they were yet to receive the 4 per cent from Customs.”

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