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Industry Guide:

Auction Services

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1. I am an auctioneer as well as a GST registered person. What are those incidental expenses which I can claim input tax credits? 

All business acquisition made incidental to the services provided by you as an auctioneer, such as utilities, professional fees, rental and other overhead expenses are entitled to input tax claim. 

2. Can GST paid on capital assets like building and office equipment regarded as input tax credit?

If you are a GST registered person, GST paid on capital assets are also allowable as input tax credit.

3. I am an auctioneer acting as an agent under my own name. Must I pay GST on goods that my principals send to me for auction?

Goods supplied to you for auctioning are disregarded for the purpose of GST, meaning you do not have to pay any GST on such supplies. However, when such goods are subsequently auctioned off and if the owner of the goods (seller) is a taxable person, output tax has to be accounted by you.

4. Who should account for output tax on the goods sold in an auction if the owner of the goods is a taxable person?

Under subsection 65(4) of the GST Act 2014, the auctioneer is liable to account for GST on the supply of auctioned goods made on behalf of the principal who is a taxable person irrespective of whether the auctioneer is a taxable person or not.

5. I am an auctioneer who is not registered for GST, if I auction goods belonging to a taxable person, can I issue tax invoices?

No, you cannot issue tax invoices even if you are auctioning goods belonging to a taxable person if you are acting in your own name. However, you have to issue a document containing the particulars of the tax chargeable and this document will be treated as a tax invoice provided by the taxable person.

6. As an auctioneer, am I required to find out the GST status of the owner of goods before I auction goods on his behalf?

Yes, you are required to do so. You can look up his GST status from our GST website. Determining the GST status of owner of goods is necessary as you are liable to account for output tax on any goods which you auction on the owner’s behalf if he is a taxable person.

7. Is the auction price of goods inclusive of GST?

The auction prices for goods which belong to the taxable person must be treated as GST inclusive. If the goods to be auctioned are taxable goods, you as the auctioneer must inform the bidders before the auction that the goods are subject to payment of GST. This is to differentiate that the goods sold is not your goods but you are liable to account for GST on the supply. 

8.In an auction when is the time of supply for the auctioned goods?

The time of supply is the time when the auctioneer issues the document or goods are handed over to the successful bidder or when the payment received whichever is the earlier.

9. In certain cases, bidders to an auction may be required to furnish a certain amount of deposit to the auctioneer. Would such deposit attract GST?

Deposit paid as a condition to an auction does not attract GST until the deposit become part of the payment made by the successful bidder to the auctioneer. 

10. What is the GST treatment on a deposit that is forfeited when the successful bidder failed to pay the balance of payment before the stipulated date?

Such deposit is deemed to be a payment made on a taxable supply if such payment is meant for payment of the auctioned goods. Output tax is chargeable on the deposit forfeited. Any commission derived from the part payment by the auctioneer is also a taxable supply.

11.What is the GST treatment on entry fees (a sum of money paid by the owner to the auctioneer to auction goods) if the auction is unsuccessful?

If goods put up for auction is not sold and the entry fee is forfeited, the auctioneer has to account for output tax on the forfeiture because it is a payment for services rendered by the auctioneer. 

12. I am an auctioneer and if I purchase goods directly from an owner, would the purchase attract GST?

Even though you are an auctioneer, any purchase of goods made by you from the owner would be treated as a normal taxable supply and output tax is chargeable by the seller who is a taxable person (GST registered person).

13. I am an auctioneer and if I purchase goods from a non-taxable person, do I have to charge GST when I auctioned the goods?

Under such circumstances, you are not acting as an auctioneer, but as taxable person making a supply of goods. Therefore, if you are a registered person, you have to account for output tax when your goods are sold in an auction.

14. If a governmental department carries out the auction of its own vehicles, would that attract GST?

No, any supplies made by Government departments is not within the scope of GST. 

15. Are vehicles that are owned by the Government but auctioned by a professional auctioneer regarded as out of scope supplies?

Yes, as the Government is the one who is making the supplies of the vehicles. 

16. In furtherance to question in Q15 above, would the commission charge to the Government, being an out of scope supplies attract GST?

Commissions charged by an auctioneer to the Government for the auction of vehicles or any other goods are still subject to output tax as the commissions are charged by the auctioneer for the services rendered. 

17. I was engaged by a non-resident who is not liable for GST to auction his goods in Malaysia. What is the GST implication on the goods imported and its subsequent sales through an auction?

If you are importing and supplied for a non-resident person, you are deemed to be the principal importing the goods. You have to pay GST on the goods that were imported on behalf of your principal. If you are a registered person, you can claim input tax credit on the GST paid for the importation, and you must account for output tax on the goods that are subsequently auctioned by you. For further details, please refer to Guide on Agent.

18. I am an auctioneer and owned a warehouse licensed under section 65 of the Customs Act 1967. What is the GST implication on goods that I brought from overseas and stored in the licensed warehouse while waiting to be auctioned?

GST on goods is suspended when the goods are stored in your licensed warehouse. GST would only be due and payable when the goods are taken out from the licensed warehouse by the successful bidder or any other person. 


19. In furtherance to question in Q18 above, how does the successful bidder account for GST and on what value should he declare?

The successful bidder has to pay GST and any other taxes using a Customs No. 1 form. The price that he bid and paid for the goods in the auction would be treated as the last supply which is subject to customs duty and GST. For further details, please refer to Guide on Warehousing Scheme.

20. I was engaged by a non-resident from overseas to auction his goods in Malaysia, but currently the goods are located outside Malaysia. What is the GST implication on the goods if I manage to auction them?

Goods located overseas would not be subjected to output tax even if they are auctioned here (in Malaysia). GST on the auctioned goods would be imposed at the time of importation when the successful bidder brings the goods back into Malaysia. 

21. Must I account for output tax on commission charged to my overseas client if the auction is carried out on his behalf in Malaysia, but the auctioned goods remains overseas?

Services performed for a non-resident in relation to goods situated outside Malaysia is treated as a zero-rated supply. Hence, the commission earned is not subjected to tax.

22. What are those supplies that must be included by an auctioneer when determining his threshold?

Normally for an auctioneer, the commissions earned by him would form the basis of his turnover in calculating the threshold. However, if the auctioneer is also making taxable supplies other than those related or incidental to his profession as an auctioneer, such other turnovers would be included in the calculation of his threshold for GST purposes.


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