What is CP58 – Statement of Monetary and Non-Monetary Incentive Payment to Agent, Dealer or Distributor?

The Income Tax Act, 1967 (ITA) 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 applies to even a foreign company and foreign branch which operate in Malaysia BUT excludes those individuals carrying out a business or under partnership.

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 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 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.

For the last Form CP58, can be downloaded from LHDN website:

http://lampiran1.hasil.gov.my/pdf/pdfborang/Borang_CP58_1.pdf