Employee Benefits

Any goods or services provided free to employees
Goods or services acquired and given as employee benefits to employees are considered as used "for the purpose of business""
Generally, GST incurred goods or services acquired and used for the purpose of his business in the making of taxable supplies is CLAIMABLE, and GST has to be accounted for on the taxable supplies made.
Employee benefits include any right, privilege , service or facility provided free of charge to employees as stated in the contract of employment
- not subject to GST and input tax is claimable
If not stated in the contract of employment
- All googds provided free to the employees is subject to GST (subject to gift rule of RM 500) except those exempted, blocked input tax and zero rated goods
- Input tax claimable
- Output tax on gifts > RM 500
- Value to be based on open market value
Services supplied fee
- No GST

Example 1

Company A purchased 15 hampers for his employees worth RM200/hamper
- every employee will get one hamper FOC
- no need to account for output tax
- Input tax on 15 hampers = RM 180 (RM 3000*6%) is claimable

Example 2

Company B purchased 2 non-monetary vouchers for 3 days and 2 nights stay in Pulau Redang worth RM 1,000/voucher for his employees
- supply of services given free
- no need to account for output tax
- Input tax on 2 vouchers upon sales RM 120 (RM 2,000*6%) is claimable