SST - Group C: Night Clubs, Dance Halls, Cabaret, Health Centres, Massage Parlours, Public Houses And Beer Houses Group D: Private Club Group E: Golf Club & Golf Driving Range

Group C: General Operation of Night Clubs, Dance Halls, Cabaret, Health Centres, Massage Parlours, Public Houses and Beer Houses

Public house (abbreviated as pub) is a place permitted to sell and serve intoxicating liquors and beers. Meanwhile, beer house is a place to sell and serve beers only.

Service Tax Treatment on Night Clubs, Dance Hall, Cabaret, Health Centres, Massage Parlours, Public Houses and Beer Houses

Taxable Persons

Any person operating the listed businesses below who provides total value of taxable services exceeding RM500,000 is a taxable person.

(i) Night-club; 
(ii) Dance hall; 
(iii) Cabaret; 
(iv) Public house or beer house
(v) Health or wellness centre, massage parlour, government healthcare facilities, and teaching hospitals

** A teaching hospital is a hospital that provides clinical education and training to future and current doctors, nurses, and other health professionals, in addition to delivering medical care to patients. They are generally affiliated with medical schools or universities (hence the alternative term university hospital), and may be owned by a university or may form part of a wider regional or national health system.

Taxable Services

(i) Provision of dancing partners or social escorts. 
(ii) Provision or sale of food, drinks or tobacco products. 
(iii) Provision of services in the form of corkage, towel charge or cover charge. 
(iv) Provision of health services, which are normally provided by health centres. 
(v) Provision of massage services. 
(vi) Provision of premises for meetings or for promotion of cultural or fashion shows. 
(vii) Provision of parking spaces for motor vehicles where parking charges are imposed.

Group D: General Operation of Private Clubs

Private club is registered under the Societies Act 1966 and the membership can be limited to members, professions and class of person.

Service Tax Treatment on Private Clubs

Taxable Person

Any person operating private clubs having a total taxable services exceeding RM500,000 is a taxable person.

Taxable Services

Taxable services include: 
(i) Provision of sports or recreational services including the entitlement to use such services by club members for which membership subscription fees are charged other than golf. 
(ii) Provision or sale of food, drinks or tobacco products. 
(iii) Provision of services in the form of corkage, towel charge or cover charge. 
(iv) Provision of health services, which are normally provided by health centres. 
(v) Provision of massage services excluding massage services provided in barber shops, hairdressing salons or beauty salons. 
(vi) Provision of premises for meetings or for promotion of cultural or fashion shows. 
(vii) Provision of parking spaces for motor vehicles where parking charges are imposed.
(viii) Provision of rooms for lodging or sleeping accommodation. 
(ix) Provision of golf course, golf driving range or services related to golf or golf driving range, i.e. for: 
(a) Green/ season pass; 
(b) Caddy; 
(c) Rental of golf buggy/ turf mate; 
(d) Rental of golf equipment; 
(e) Guest; 
(f) Complimentary play; 
(g) Coaching; 
(h) Absence; 
(i) Competition entrance; 
(j) Tournament; 
(k) Lighting for night golfing; 
(l) Night golfing; 
(m) Practice range balls or driving range balls; 
(n) Rental of golf shoes; 
(o) Subscription fees.

Group E: General Operation Of Golf Club And Golf Driving Range

A golf club is an organized group of golf players, or the building in which they meet and the area on which they play.

A golf driving range is an area where golfers can practice their golf swing. It can also be a recreational activity itself for amateur golfers.

Service Tax Treatment on Golf Club and Golf Driving Range 

Taxable Person

Any person operating any golf course or golf driving range and having a total value of taxable services exceed RM500,000 is a taxable person.

Taxable Services

Taxable services include: 
(i) Provision of golf course, golf driving range or services related to golf or golf driving range, i.e. for: 
(a) Green/ season pass; 
(b) Caddy; 
(c) Rental of golf buggy/ turf mate; 
(d) Rental of golf equipment; 
(e) Guest; 
(f) Complimentary play; 
(g) Coaching; 
(h) Absence; 
(i) Competition entrance; 
(j) Tournament; 
(k) Lighting for night golfing; 
(l) Night golfing; 
(m) Practice range balls or driving range balls; 
(n) Rental of golf shoes; 
(o) Subscription fees

Responsibilities of a Registered Person

A registered person is responsible to: 
(i) Charge service tax on taxable services; 
(ii) Issue invoices and receipts with specific particulars; 
(iii) Submit service tax return SST-02 electronically and pay service tax before the due date; and 
(iv) Keep proper records.

Frequently Asked Questions (FAQs)

Q : Does membership renewal subject to service tax? 

A : Yes.

Q : My private club is providing massage service to staff for free. Does the service provided subjected to service tax? 

A : Yes, such massage service is subjected to service tax.

Q : I am a public house (pub) operator. If my customer bring their own liquor/ beer and consume in my premise, can I charge them service tax? 

A : Yes, you can charged them service tax on your other taxable services such as corkage, towel charge or cover charge if any.

Q : My club house is providing a vending machine selling sanitary pads, water and junk foods. Do I have to charge service tax to my club house member when they purchase these items? 

A : Provision of sale of food, drinks and tobacco products are consider as a taxable service. Therefore, the sale of water and junk foods is subject to service tax except for sale of sanitary pads.

Q : I am a golf club operator, my customer booked a session and failed to be present on the event and I will charge him RM100 for no show charge. What is the service tax treatment for no show charge? 

A : No show charge is subject to service tax.

Q : Are tips given by guests or customers voluntarily are subjected to service tax? 

A : A tips given by guest or customer to a staff as token of appreciation for services rendered is not part of consideration for the supply and is therefore not subject to service tax. However if the tips is included in the customer’s bill as a mandatory service charge, then service tax is chargeable.

Q : I am a golf club operator. I have a parking space and charge parking fee to patronize. I also provide rooms for meeting and lodging or sleeping accommodation. Does the services provide is subject to service tax? 

A : Yes, the services are subject to service tax.

Q : Does partial payment for membership fee as a club member subject to service tax? 

A : Yes. Partial payment is subject to service tax at 6%.

Q : Mr. Ahmad booking a wedding package inclusive of a hall, catering, parking and decoration at private club for his wedding. Mr. Ahmad would like to know whether this wedding package is subject to service tax or not? 

A : Yes. This wedding package is subject to service tax.

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Edited by: 浪子

Bibliography

Royal Malaysian Customs Department. (2018). Group C: Night Clubs, Dance Halls, Cabaret, Health Centres, Massage Parlours, Public Houses And Beer Houses Group D: Private Club Group E: Golf Club & Golf Driving Range. 
Retrieved from https://mysst.customs.gov.my/assets/document/1.%20Guide%20on%20Clubs_23082018~1.pdf

Teaching Hospital. (n.d). Retrieved from http://hospital.com.my/teaching_hospital.htm