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Industry Guide:

Event Management Industry

 
Please click here to download complete guide.

 

FREQUENTLY ASKED QUESTIONS 

Registration

1. Which event management providers need to register?

All event management providers are required to be registered under the GST Act if they are making taxable supplies in the course or furtherance of business and have exceeded the prescribed threshold of RM500,000 in a twelve months period. (For further information on registration, please refer to Guide on Registration).


Taxable supply

2. Which event management activities attract GST?

All event management activities attract GST since they are taxable supplies;
Examples are:

(a) Conceptualization of the event;

(b) Event Production;

(c) Management services;

(d) Event Supervision;

(e) Admission into events;

(f) Event Advertising;

(g) Facilities for hire; and

(h) Security services. 

3. Is GST payable on a supply of space for an exhibition given free of charge to regular exhibitors?

A supply of space for exhibition offered free to regular exhibitors is not subject to GST provided this service is also available to any other exhibitor free of charge. 

4. A company organizes a fashion show and gives away some free admission tickets and free T shirts. How does the company account for GST on free goods or free services if these goods or services are given to selected customers?

The treatment of GST can be divided into two different treatments as follows;

(a) Goods given free are subject to gift rules. Goods which cost the company RM500 and below per person within a year is not subject to GST.

(b) Free services are treated as non supply and therefore not subject to GST.

There are no special GST treatment rules on the gift given to selected customer. Normal GST rules apply. 

5. As an event organizer, I organize seminars, workshops, conferences for both the private and government sectors. Do I have to account for GST if I provide such services:  

   (a) solely to the private sector (companies);

   (b) solely to the public sector (government agencies); or

   (c) to both the private and public sectors?

Irrespective of whether your clients are from the private or public sectors you have to charge GST for providing the above services if you are GST registered person.

6. MICE (Meeting, Incentive, Convention & Exhibition) being an event organizer, organizes seminar on behalf of Ministry of Defence which is open to the public locally and internationally. How is GST accounted for the event?

There are three element of GST on the above scenario;

(a) Event management fees charged to Ministry Of Defence by MICE is subject to GST.

(b) If there is a charge on admission ticket, it is subject to GST.

(c) Goods sold / services perform during exhibition are subject to GST.

If MICE is a GST registered person, input tax credit on inputs are claimable.

7. Occasionally certain personnel from the public or private sector are invited to attend these events as guests without any charges. What is the GST treatment in these cases?

Such free participation not a supply and therefore is not subject to GST.

8. What is the GST treatment on supplies made by an event management company who organizes an exhibition in Malaysia but the participants are mainly from abroad?

The GST treatment has to take into account ‘where the supplier belong concept’. In this case, the suppliers belong to Malaysia. Therefore the event management company has to account for GST if the event management company is a GST registered person.

9. An event management company on behalf on Ministry of Defence organizes Langkawi International Maritime Aerospace (LIMA) show in Langkawi. What is the GST treatment on this exhibition organized by the event management company? 

Under section 154 of the Goods and Services Tax Act 2014, Langkawi is classified as designated area and therefore no GST is payable on goods supplied in designated area and on services performed (provided the supplier of services is from Langkawi).


Admission fees and ticket

10. What is the GST treatment on admission fees on exhibition? Who is liable to account for GST if the admission fees are collected by a ticketing Agent?

Admission fees are taxable supplies and subjected to GST. If the organizer is a GST registered person, he must account for output tax. If the tickets are sold by an agent appointed by the organizer (principal), the organizer must account for GST on the admission fees and the commission paid to the agent if he happens to be a GST registered person.

11. I am an event manager and a GST registered person. Is it necessary to indicate the GST charged on the admission tickets to an event? 

The ticket must show the total amount payable excluding tax, the rate of tax and the total tax chargeable shown as a separate amount.

12. What is the GST treatment on the commission received by ticketing agent?

If ticketing agent is a GST registered person, the agent need to account for GST on the commission received.


Imported service for performance services 

13. As an event management provider and GST registered person, I have engaged a professional entertainer from overseas to perform at a dinner and fashion show. Is the performance provided subject to GST and who should pay the tax? 

Services from overseas is regarded as imported services and are subject to GST. You should account GST for the imported services by reverse charge mechanism. (For more information on imported services and reverse charge mechanism, please refer to the GST General Guide).


Co-organizers of reality show 

14. Company XYZ, an event management provider, co- organized with a broadcasting station and Telekom Malaysia to jointly produce a reality show. How is the GST accounted for in this case? 

If the reality show is co-organized by few parties, each party must be able to identify its own supply to determine the GST liability. XYZ must charge GST on the exclusive right to air the show. The broadcasting station, in return would charge GST on advertising space to Telekom Malaysia. Telekom Malaysia would charge GST on services provided to the short message system (SMS) users for sending SMS to the show.



Rental

15. As a GST registered person and event organizer for an exhibition, I collected RM2,500 on space rental for two days exhibition from exhibitors. Should I charge GST on the rental?

Yes, space rental collected from exhibitors is subjected to GST. As a GST registered person you must account the tax on the rental collected by you.

16. What is the GST treatment on charges for a rental space for an exhibition which also provides furniture, electrical appliances and security to the exhibitors?

Supply of rental space, whether completely furnished or unfurnished, is subject to GST. Any additional equipment facilities or services provided are taxable supplies and subject to GST. However, if it is provided as part of a package, the GST will be accounted on the charges as a single supply.


Deposits

17. As an exhibition organizer I also collect deposits on advanced bookings for rental space. Are these deposits subjected to GST?

GST treatment on deposit would depend on whether it is a security deposit or forms part of a payment. GST is not chargeable if it is a security deposit. However, if the deposit is part of a payment for rental space, it is considered a taxable supply and therefore subjected to GST.


Sponsorship

18. An exhibition organizer receives sponsorship from a company in return for providing advertising space in the exhibition. Is the sponsorship subjected to GST?

Sponsorships are taxable supplies if benefits are provided in return for the sponsorship. In this case, the company has received advertising space (benefit) and therefore, the sponsorship is subjected to GST.



Advertisement

19. Are advertisements displayed during an event (for example at the podium, publication materials, attire and promotional items) sponsored by advertising agencies subjected to GST? 

Yes, advertisements are taxable supplies; hence the event organizer has to account for GST.


Parking facilities

20. Parking facilities at an exhibition are provided to guests free of charge. Must the organizer account for GST on the parking services provided? 

If the parking facilities are provided free of charge, then, it is not subject to GST. However if the parking facilities are charged, then it is subjected to GST.


Coin operated machine 

21. Is commission or shared profit paid by the vendor of coin operated machines placed in a trade show, subject to GST? 

The commission or shared profit is a consideration for the right to operate the machines. As such, it is subjected to GST. 


Consultancy and advisory services 

22. Apart from event management, we provide consultancy and advisory services to clients on seeking approvals from related government agencies. Are these services subjected to GST? 

All consultancy and advisory services are subjected to GST. 


Discount

23. As an event organizer, we give discounts to our customers. What is the GST treatment on the discounts given? 

Discount is allowable if it is given to all and GST is charged on the discounted or reduced amount.


Tax point

24. When do we account GST for providing event management services? 

You have to account for GST at:

(a) the date when you received the payment; or

(b) the date when you issue a tax invoice, whichever is the earlier.


Input tax credit

25. As a GST registered person, am I entitled to claim any input tax credit and how do I do it? 

Being a registered person you are entitled to claim input tax that you have incurred on purchases such as capital assets, utilities, material and professional fees attributable to your taxable supplies. You can claim your input tax in the following tax returns according to your approved taxable period by offsetting from the output tax payable to the Royal Malaysian Customs (RMC). (For further information please refer to the GST on Input Tax Credit).


Goods for private use 

26. Can input tax be claimed for the goods and services which were supplied for the event, but have been used by the staff for private use?

No, Input tax cannot be claimed on these supplies as they are not used in the course or furtherance of business. 
 
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