Form CP 58 – Duty to Furnish Particulars of Payment Made to an Agent, Dealer or Distributor, etc.

With effect from 1st January 2012, the new Section 83A of the Income Tax Act 1967 (ITA 1967) imposes the  responsibility to companies to issue a form CP 58 on any incentives (whether in monetary form or otherwise) to its agents, dealers or distributors. Agent, dealer or distributor is defined in Section 83A (4)of ITA 1967 to mean “any person who is authorized by a company to act as its agent, dealer or distributor, and who receives payment (whether in monetary form or otherwise) from the company arising from sales, transactions or schemes carried out by him as an agent, dealer or distributor.”

This new requirement applies to even a foreign company and foreign branch which operate in Malaysia BUT excludes those individuals carrying out a business or under partnership.

To ease some administrative burden, the IRBM had announced that from 31 December 2012 onwards, the form CP 58 only need to be prepared for those recipients where the monetary and non-monetary incentive payment are of  an amount exceeding RM5,000 per annum. For non-monetary incentives such as motor vehicle or house, the actual value/amount incurred by the payer company will be the incentive deemed received by the recipient.

Incentives which are not required to be disclosed in the Form CP58 include:
  1. trade discounts and bulk discounts;
  2. promotional items / gifts received which are not stipulated in the contract;
  3. incentives given for an open invitation to encourage the public/ customers to introduce more customers;
  4. special treatment in the form of preferential rate given to an independent agent who buys and sells goods on his own accord. He is a customer to the producers/wholesalers, except that he enjoys preferential rate due to his purchasing power;
  5. Credit rebate – i.e. Company selling products to supermarkets, sundry shops, minimarkets etc. Company gives customers a credit rebate (credit notes to offset their account) when they make a prompt payment & hit the yearly target/quota;
  6. Sub-contractors;
  7. Handling fees (i.e. loading and unloading of goods or luggage, etc) – i.e. company is in air transport business and sells air tickets to travelers. Company sub-contracts its ground handling services to an agent. The agent solely provides ground-services and does not sell air tickets to travelers. The agent is merely a sub-contractor to the company and merely receives handling fees; and
  8. Items such as umbrellas, pens, calendars etc. given to all agent, dealers and distributors which are not based on performance.

The payer company does not have to provide tax reference number and residence status of the payees in the form CP 58 if the information is not available. However, it is compulsory for the payer company to provide the registration number, identity card number, police number, army number or passport number of the recipients as well as the identity card number and signature of the designated officer.

The Form CP 58 shall be provided to the agent, dealer or distributor not later than 31 March in the year immediately following the year in which the incentives mentioned above are paid. Any payer which fails to prepare the form CP 58 as required under this Section shall be guilty of an offence and shall, on conviction, be liable to a fine of not less than two hundred ringgit and not more than two thousand ringgit or to imprisonment for a term not exceeding six months or to both.

The CP 58 is a prescribed form. The payer company is not allowed to:

  • provide stamped signature on the form CP 58, or

  • generate the form CP 58 by computer (i.e. PDF or Excel), without signature or stamp, or
  • generate form CP 58 with digital signature or electronic stamp of the company
  • modify the form CP 58, for example changing the alignment, insert a line, etc.

The name, designation and NRIC number of the preparer of the payer company are required. Although NRIC number of the preparer is irrelevant to the agent, it becomes important to the Inland Revenue Board (IRB) when the form CP58 is produced as evidence in court in the event a case is brought to court.

The original copy of form CP58 must be retained by the payer company for a period of seven (7) years from the end of the calendar year in which the incentive is paid to the agent, dealer or distributor for the purpose of reference and examination by the IRB during a tax audit. A copy of the form should be given to the agent, dealer or distributor.

The IRB has agreed to extend the concession for payer companies not to issue Form CP58 for the calendar year 2012, provided that they had issued an annual statement to their agents, dealers and distributors for the year 2012. The statements must have information regarding monetary and non-monetary incentive payments.

Irrespective of whether a payer company issues Form CP58 or the yearly statement to its agents, dealers or distributors, the monetary and non-monetary incentive payment should be of amount exceeding RM5,000.

The latest  version of the form CP58 in PDF and Excel format together with the Guidelines are available at the Inland Revenue Board’s website, at the following:

Home Page > Forms > Return Forms > Other Forms > Form CP58

Or you may download them at the following links:

About Richard

Richard Oon Hock Chye has more than 25 years of experience in taxation and business advice, with particular expertise in Malaysian property law. He began his taxation career with Deloitte Touche Tohmatsu, a ‛Big Four’ accounting firm, before starting his own practice, ConsulNet Tax Services Sdn. Bhd., in 1996. He is currently the National Tax Director of TY Teoh International, one of the leading consulting service providers in Malaysia. It is a member of the MSI Global Alliance, a global network of more than 250 independent legal and accounting firms, in over 100 countries. Richard sits on the board of two companies listed on the Main Board of Bursa Malaysia, as an independent non-executive director. He is also a regular contributor to several magazines and publications, and has shared his tax expertise on numerous occasions with organisations and property developers. As well as being a member of the Malaysian Institute of Accountants (MIA), Richard is a fellow member of both the Association of Chartered Certified Accountants (ACCA) and the Chartered Tax Institute of Malaysia (CTIM). He is a Certified Financial Planner (CFP) and holds a tax agent licence issued by the Ministry of Finance. Richard is also the author of the book, ‘Every Property Investor’s Guide To How To Pay Less Tax Legally’.

4 thoughts on “Form CP 58 – Duty to Furnish Particulars of Payment Made to an Agent, Dealer or Distributor, etc.

  1. Dear Richard,

    Greetings to you.
    I have an enquiry on the CP58 form which is being sent to me Mar 2013.

    I purchased a new vehicle on Dec 2012. There was this year end promotion by the dealer, saying that they will offer a 12k discount on top of the vehicle price, so that I do not have to pay any down payment. Anyhow, I was told to make the down payment via credit card, which is 10% of the vehicle (RM12988 to be precise). There after, the dealer issued back me a cheque of the same amount, as a form of proof that I have made the down payment.

    However, I received the CP58 form, that it shown my name in Part B in CP58, and stated as Broker Fee in Part C. I am confused. Since when and how did it become a broker fee?

    My main questions are:
    1. Do I need to declare it in my income tax for 2012?
    2. Did the dealer make a mistake in sending me the CP58? I called them and they say that I need to declare it. But I am only a customer, not a dealer or agent.
    3. To whom should I refer to should I decide to file a complaint?

    Hope to hear from you soon, thank you.

    • From the information you have given, it appears to me that the dealer’s treatment of the discount given to you is all WRONG.

      Section 83A (4) of the Income Tax Act 1967 defines an “agent”, “dealer” or “distributor” as any person who is authorised by a company to act as its agent, dealer or distributor, and who receives payment (whether in monetary form or otherwise) from the company arising from sales, transactions or schemes carried out by him as an agent, dealer or distributor.

      Unless you have entered into an arrangement to sell cars on behalf of the dealer, then clearly the discount given is not taxable on you. Besides, this ‘discount’ given to you is not income in nature, as income is earned from carrying on a profession, vocation and trade and every manufacture, adventure or concern in the nature of trade, which from the information you have given me, is clearly not the case.

      I would suggest that you may ignore the form CP 58 given to you.

      To file a complaint, you may contact 1-800-88-5436 or contact the IRB’s branch nearest to you.

  2. hi Richard, got a cp58 that I never received before….inside the statement there is a non-monetary incentives for travel package, should I include such travel incentives in my tax computation? i was told by my friend for oversea trip i can be exempted once in a year, is it true?
    appreciate ur reply, thanks :)

    • Unfortunately, the travel exemption (ie. leave passage) only applies to an employee of a company. If you have received a CP58, it looks like you are not an employee, but an agent, dealer or distributor of the company :(

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