Announcement
Please be informed that provision of all types of insurance policy to all business organization (B2B) is subject to 6% service tax effective 1 September 2018.
Hong Leong Assurance Berhad (“HLA”) reserves the right to collect from the policyholders an amount equivalent to the Service Tax payable on the applicable premium for the policy period. In the event that the policy period commences before but expires after 1st September 2018, HLA may collect from the policyholders an amount equivalent to the Service Tax payable on the applicable premium calculated from 1st September 2018 on a pro-rated basis.
The policyholder’s obligation to pay Service Tax shall form part of the Terms and Conditions in the policyholder’s insurance policy.
The laws governing Service Tax are as per the Service Tax Act 2018 and all Regulations passed by the Government of Malaysia from time to time.
For more information on Service Tax and the taxable insurance products, please refer to our FAQ.
Service Tax is a consumption tax governed by the Service Tax Act 2018 and its subsidiary legislation. Service tax is imposed on prescribed services called “taxable services” made by prescribed taxable persons.
The Service Tax rate is 6% imposed on the value of taxable services or the actual premium paid for insurance policy. However, the Minister may, by order published in the Gazette vary or amend the rate of tax fixed under section 10(2)(b) of Service Tax Act 2018.
Service Tax will be imposed on taxable services made on or after 1st September 2018.
Only service tax registrants can charge and collect the service tax.
HLA is a service tax registrant and hence, liable to charge service tax on taxable services.
A Service Tax registrant needs to issue valid invoices to charge Service Tax on the taxable services. The Service Tax registration number and Service Tax amount will be printed on the invoices.
Provision of life and medical insurance policy to business organisation (B2B) will be subjected to Service Tax (i.e. where policy owner or assignee is a business organization). However, provision of insurance policy to educational institution and religious organisation registered under any written law are excluded from service tax. Provision of life and medical Insurance to individuals (B2C) are not subjected to Service Tax.
If you have made full payment for the total premium including 6% GST, you will not be charged with Service Tax for the insurance coverage period from 1 September 2018 to 31 March 2019.
All life insurance policy sold to business organisation will be subjected to Service Tax. As the coverage period span over 1 September 2018, a Debit Note will be issued to charge Service Tax on the pro-rated premium for the period from 1 September 2018 until 30 June 2019. The premium allocated to the period from 1 July 2018 to 31 August 2018 is not subject to Service Tax.
All medical insurance policy sold to business organisation will be subjected to Service Tax. As the coverage period span over 1 September 2018, a Debit Note will be issued to charge Service Tax on the pro-rated premium for the period from 1 September 2018 until 30 June 2019. The premium allocated to the period from 1 July 2018 to 31 August 2018 is not subject to Service Tax.
No Service Tax shall be charged and levied on any taxable service provided within or between special areas (Free Zone, Licensed Warehouse and Licensed Manufacturing Warehouse, and Joint Development Area) or between special areas and designated areas (Labuan, Langkawi, Tioman). Service tax is applicable for taxable services provided between principal place of business located in Malaysia and special areas.
No, insurance premium remains the same but total amount payable will increase to include Service Tax charged on life and medical insurance premium sold to business organisation.
General information and educational materials regarding Sales and Service Tax is available at MySST Portal at https://www.mysst.customs.gov.my/
Yes. HLA is a Service Tax registrant and will charge Service Tax on all taxable services provided to you unless you are able to provide us a letter from the relevant authorities stating that you are granted an exemption from paying Service Tax.
Do contact our Customer Service Hotline at 03-7650 1288 during office hour or email to customerservice@hla.hongleong.com.my for any queries in relation to Service Tax on HLA insurance products.
