Online advertising services provided by non-residents are subject to withholding tax

The Inland Revenue Board of Malaysia (IRBM) has issued a practice note entitled “Practice Note 1/2018 – Tax Treatment on Digital Advertising Provided by a Non-resident” on 16 March 2018 Practice notes are the views and interpretation of IRBM on applicable tax legislations. As such, they may pose tax and other implication for your business. Summary of tax treatment For digital advertising service payments from a Malaysian entity to a non-resident who do not have a permanent establishment and business presence in Malaysia, the following tax treatments are applicable: Where the payment is to a non-resident who has a permanent establishment or business presence in Malaysia, the payment is a S.4(

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