Wage Subsidy Program (3 Apr 2020)

Kuala Lumpur, 3 April 2020 We have been receiving many enquiries regarding the issue of the PRIHATIN Wage Subsidy Program (hereinafter ‘’WSP’’) and Baker Tilly is keen to provide some insights on the WSP from what we have ascertained from the public releases made available:

What is WSP and Who will Benefit:
• WSP is the Malaysian government’s initiative to aid employers experiencing a decrease in more than 50% of their revenues since January 2020.
• The objective of WSP is to help employers in all sectors (except Government sector workers, foreign workers and expatriates) affected by the economic impact of the COVID-19 outbreak to continue in their operations and to retain their employees.
• Under the WSP, employers will be given a subsidy of RM600 per month for each employee earning a monthly salary of RM4,000 and below for a period of 3 months effective from 1 April 2020.

What are the Conditions of WSP:
• Employer and their employees must be registered with the Employment Insurance System (EIS) under the Social Security Organisation (SOCSO).
• Employer must make a declaration [“Akuan Pengisytiharan Program Subsidi Upah 50 (PSU50)”] (click here for the form) that the company is experiencing a decrease of more than 50% of its revenue by comparing its total sales revenue in January 2020 with those in the subsequent months.
• Employees with a monthly salary of RM4,000 and below and the scheme is limited to 100 employees for each employer (click here for the form).
• Employers must not terminate their employees from employment, instruct their employees to take unpaid leave or cut the salaries of their employees within a period of 3 months from receiving the wage subsidies and a subsequent 3 months period.

How to Apply for the Wage Subsidy:
• Employers are allowed to make the application (via prihatin.perkeso.gov.my) starting from 1 April 2020.
• The application process may take 7 to 14 days for the wage subsidy to be credited directly into the employer’s bank account.

For registration and submission of the forms, please follow the link https://www.perkeso.gov.my/index.php/en/wage-subsidy-programme.

There is also a scheme under the Stimulus Package available for employers who have placed their employees on leave without pay during the COVID-19 crisis, and the scheme details can be found at https://www.perkeso.gov.my/index.php/en/kenyataan-media.

Please note that WSP and the scheme under the Employee Retention Program with PERKESO are mutually exclusive.

We will keep you updated on any further guidelines and announcements to be issued by the relevant authorities, if any.

For any enquiries or assistance on Sales Tax and Service Tax, please contact any of the following in this office:

Mr Anand Chelliah
Managing Partner, Tax Services
Asia Pacific Tax Leader
DL: +6 (0)3 2297 1093
anand.chelliah@bakertilly.my

Mr Marcus Tan
Executive Director (Corporate Tax & Tax Incentive), Tax Services
DL: +6 (0)3 2297 1521
marcus.tan@bakertilly.my

Mr Yohan Francis
Executive Director (Transfer Pricing), Tax Services
DL: +6 (0)3 2297 1096
yohan.xavier@bakertilly.my

Mr Murugan Anbanantham
Director (Technical), Tax Services
DL: +6 (0)3 2297 1004
murugan.anbanantham@bakertilly.my

Ms Tay Siew Chu
Associate Director (Corporate Tax & Personal Tax), Tax Services
DL: +6 (0)3 2297 1139
siewchu.tay@bakertilly.my

Ms Sandra Saw
Associate Director (Corporate Tax & Sales Tax and Service Tax), Tax Services
DL: +6 (0)3 2297 1146
sandra.saw@bakertilly.my