Foreign public entertainers: The top 5 things you need to know from a Malaysian tax and immigration perspective

17 September 2019
By Lim Phing Phing (Director), Global Mobility Services, PwC Malaysia

“There’s no business like show business” so goes the lyrics to the song written by Irving Berlin. Certainly, it is a business like no other for entertainers and performing artistes. Talent and popularity take them beyond the shores of their countries, on global tours from one country to the next for months at a time.  

Underneath the glamourous surface, event organisers need to be aware of what they’re in for when booking an artiste for an event. Malaysia, like many other countries, has tax and immigration regulations around hiring and bringing in foreign artistes and entertainers for performances at various public entertainment outlets.

Despite this, some have skirted around the regulations, entering and leaving the country without incident, while others have not been so lucky. Those caught without appropriate visas were detained by immigration authorities while show organisers were penalised with hefty sums for flouting the laws.

So what are these immigration and tax requirements? Are foreign artistes, entertainers and Malaysian show organisers aware of these requirements and the implications around them?  

Here are the top 5 things you need to know about immigration and taxes before you book a foreign artiste for a show in Malaysia. Notice that these requirements are not only applicable to performers, but also those visiting to give talks or lectures. 

   

Immigration

Tax

1.

Who are considered non-resident public entertainers?

Any individual or group of individuals, who are neither Malaysian citizens nor permanent residents of Malaysia who are:

a) carrying out artistic and cultural performances; or

b) involved in an artistic and cultural performance or carrying out filming in Malaysia, including directors, cameramen, make-up artists, crew, officials and staff as well as any other position that is required for performance and filming. 


A person staying in Malaysia for less than 182 days in a calendar year and carries out the following activities:

a)   A solo or group performance as an actor, model, circus performer, compere (show presenter), dancer, entertainer, musician, singer, other artistes, or the exercise of any profession, vocation of a similar nature for cultural, educational, entertainment, religious reasons or any other purposes

b)   The use of the non-resident individual’s intellectual, artistic, musical, personal or physical skill or attribute for cultural, educational, entertainment, religious reasons or any other purposes;

c)    Lecture, speech or talk for any purpose; or

d)   A sporting event or sporting competition of any nature.

2. 

What are the immigration and tax implications?

Under Regulation 11 of the Immigration Regulations 1963, a Professional Visit Pass is issued to all foreigners who carry out performances or filming activities. Approval of the Professional Visit Pass* is subject to existing immigration conditions and regulations.

Under Section 109A of the Malaysian Income Tax Act 1967, any fees or remuneration for services performed or rendered in Malaysia by the public entertainer will be subject to withholding tax of 15%. This is regardless of whether the payment is made directly or indirectly to the non-Malaysian public entertainers. The responsibility of withholding and remitting the tax to Malaysian tax authorities falls to the Malaysian "payer" (normally the sponsor or event organiser). 

If the entertainer is a resident of a country that has a double taxation agreement (DTA) with Malaysia, the rates are prescribed where applicable by the relevant DTA.

3. 

How do you comply with immigration and tax requirements?

Before the filming or performance begins, the organiser or the local film production company has to obtain Professional Visit Passes for the foreigners involved, issued by the Immigration Department of Malaysia. This is done through the Central Agency for Application for Filming and Performance by Foreign Artistes (PUSPAL). 

The payer in Malaysia has to submit the Proforma B form and remit the withholding tax payable to the Inland Revenue Board (IRB) in the form of cash or bank draft only, together with Form 154 to the IRB payment centre. This represents the final tax paid to the authorities.

4.

What are the important deadlines that you need to be aware of?

First-time applications have to be submitted to PUSPAL at least 30 days before the date of performance/filming. Extensions have to be submitted at least 14 days before the approved period expires.

Generally, withholding tax has to be remitted to the IRB within 30 days of paying or crediting the recipient. However, for filming and performances by foreign artistes that fall under the PUSPAL Guidelines, the sponsor or organiser has to remit the withholding tax payable to PUSPAL before filming or performances begin.

5.

What are the penalties and implications for non-compliance?

For foreigners who do not comply with the requirements:

  • Misuse of Social Visit Pass, Special Pass or others - Imprisonment of not more than 6 months or a fine up to MYR1,000 or both

  • Overstaying your visa - Imprisonment of not more than 5 years or a fine of at least MYR10,000 or both

For organisers who do not comply with the requirements: 

  • Imprisonment of not more than 12 months or a fine between MYR5,000 to MYR30,000 or both for every entertainer who is brought in without applying for the correct visa

For payers who do not comply with the requirements:

  • 10% penalty on unpaid withholding tax

  • Non-deductibility of the gross payment in the tax computation of the payer

  • Penalties for incorrect submission of tax returns by payer

  • IRB can recover the withholding tax and penalty as a debt due from the payer

*Find out why you should apply for a Professional Visit Pass

It is important to note that these requirements are by no means exhaustive. The implications may change depending on the circumstances of the contractual arrangements with the relevant parties (e.g. the organiser and the artiste), change in tax residency status of the artiste, for instance staying/working in the country for 182 days or more in a year, and how the artiste’s activity in Malaysia is classified.  

Understanding and carefully managing these upfront will help avoid unnecessary issues - cancellation of performances at the eleventh hour, irate fans, and penalties. Or in some cases, detainment and subsequent deportation of performers from Malaysia. Speak to us today.

 

Did you find this blog helpful? Yes | No

 

{{filterContent.facetedTitle}}

Keep up-to-date with the latest blog posts via RSS

Contact us

Lim Phing Phing

Director, Global Mobility Services, PwC Malaysia

Tel: +60 (3) 2173 1651

Follow us