Question
Staysafe Sdn Bhd, a Malaysian resident company, was awarded a mega project by the Perak state government to construct a theme park in Tanjung Rambutan.
Staysafe Sdn Bhd, a Malaysian resident company, was awarded a mega project by the Perak state government to construct a theme park in Tanjung Rambutan. The project involves a consortium of contractors and suppliers from Malaysia as well as from Brunei and Australia counterparts. The project started in January 2019 and is expected to complete in December 2022. The following payments were made by Staysafe Sdn Bhd to its contractors and suppliers during the year 2019: 1) RM14,000,000 lump sum payment to Excite Pte Ltd, from Brunei, which consists of: RM i. Cost of materials 5,000,000 ii. Lease payment of high-tech machines 3,000,000 iii. Contract service 6,000,000 2) Payment of RM2,000,000 to ANZ Pte Ltd, an Australian company, for the use of patent and design in the project. 3) Payment of RM1,800,000 to Meranti Sdn Bhd (resident company), a subsidiary of a Brunei company for consultancy services. 4) Payment of RM350,000 for interest on term loan to Swedish bank. Required: State with reason(s) whether the above payments are subject to withholding tax and state the amount of withholding tax to be paid (if applicable).
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