2% Witholding Tax For Agents

2% Witholding Tax for Agents

1. Deduction

  • Commission in monetary form only
  • Rate: 2% on each cash payment at gross amount
  • Remit the deduction to DGIR within 30 days
  • New S107D WHT

2. Penalty For Non Compliance

  • 10% penalty if payer fails to pay the deduction to DGIR
  • Consequential amendment -S39(1 )(s ): Non allowable expenses if the commission under S107D is not deducted and paid to DGIR (WEF: A 2022)
3. Payer
  • Company (excl LLP)
  • Liable to make payment (monetary commission ) to agent, dealer or distributor (ADD)- not employee of the company
  • Commission arising from sales, transaction or schemes carried out by age, dealer or distributor

4. Payee (Recipient)

  • Resident Individual (including sole prop & partner in a partnership)
  • Received more than RM100K of commission whther in monetary or otherwise from the same company in the immediately preceding calendar year.
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