How to Pay 8% Withholding Tax for Facebook, Google, and LinkedIn Advertising in Malaysia

Running digital advertising campaigns in Malaysia on platforms like Google, Facebook, or LinkedIn? Pay attention to Withholding Tax (WHT). 

Instead of the standard 10% WHT for royalty payments, you can benefit from an 8% WHT rate under the Double Taxation Agreement (DTA) scheme for Google, LinkedIn (billed from Singapore), and Facebook (invoiced from Ireland). To enjoy this reduced rate, you must provide a Certificate of Residence (COR), also known as a Tax Residency Certificate (TRC), as proof that Google and LinkedIn are Singapore tax residents and Facebook is an Ireland tax resident.

Keep in mind that a COR is valid for one year, so you'll need a new copy each year to claim the 8% WHT.

How to Pay Withholding Tax in Malaysia Online:

Starting from April 1, 2022, the Inland Revenue Board of Malaysia (LHDN) introduced an online payment system called e-TT, which uses Virtual Account Numbers (VA) for payment identification.

Taxpayers Can Access the E-TT System by Following These Steps:

1. Log in to the MyTax portal at https://mytax.hasil.gov.my.
2. Click on "Perkhidmatan ezHasil" and select the e-TT submenu.
3. Fill in the form to generate the VA number.
4. Use the VA number as your account number for online banking or over-the-counter bank payments.

You Can Make Tax Payments From the E-TT System Through:

• Online banking portal fund transfers (IBG/RENTAS/Telegraphic Transfer/Electronic Fund Transfer - EFT)
• Payments from overseas (require SWIFT Code: CIBBMYKL)
• Bank Counter (IBG or Telegraphic Transfer, no cash or cheque payments allowed)
• ATM (multiple ATM machines support IBG Interbank Transfer transactions)

Taxes Included in the E-TT System:

• Income Tax / Cukai Pendapatan
• Petroleum Tax / Cukai Pendapatan Petroleum
• Withholding Tax / Cukai Pegangan
• Compound / Kompaun
• Entertainment Tax / Cukai Penghibur Awam
• CKHT (Cukai Keuntungan Harta Tanah)

This summary provides valuable insights into reducing your withholding tax when advertising on these platforms in Malaysia and offers a convenient way to make your tax payments online using the e-TT system introduced by LHDN.