Shared management staff

Case :
Two sister companies, one in Malaysia and one in Singapore shares a set of management staff.  These management staff are based in Singapore and fly into Malaysia to perform their duties in relation to the company in Malaysia.  They pay for their hotel accommodation using their own credit cards and claim back from the Singapore company.  Singapore company then bills company in Malaysia for the expenses via the inter-company account.

Question:
Can the company in Malaysia claim GST on the expenses billed by the Singapore company via inter-company account?
Answer :

Yes provided:-
1)   It is a disbursement i.e. the invoices for the hotel accommodation are in the name of the company in Malaysia
2)   All original invoices are kept by the company in Malaysia

However, in practice, this arrangement may be logistically challenging in terms of flow of documents.

Alternatively, the following arrangement can be adopted:-
Company in Malaysia opens a corporate account with a hotel in Malaysia.  Management staff performing their duties in relation to the company in Malaysia will charge the usage of hotel accommodation to the corporate account.  The hotel then bills the company in Malaysia directly

Dear Admin

What about it is the other way whereby company in Malaysia charge Singapore's company the shared management fee for management staff of Malaysia performing duties in Singapore? They pay for their hotel accommodation in Singapore and bill company in Singapore for shared portion of expenses incurred.

Q1 : For reimbursement/ backcharge of expenses, must Malaysia company charge GST?

Q2 : If Malaysian company were to charge GST, can Malaysian company based on the foreign exchange rate as determined by head office or must use the BNM rate at the selling rate of exchange?

Thank you.

This is considered export/international services and such supply is zero-rated.

Dear Joseph

Thanks for reply.

In that case, can the Malaysian company issue normal invoice to overseas related company?

Currently, Malaysian company issues DN to overseas related company.

Issue normal invoice.