Gift for roadshow
It is a normal business practice that a business gives free gifts to its customers. These free gifts are goods or services normally given to customers on special occasions or festival such as the giving of door gifts and gifts given free during lucky draws. Where business goods are given free to a person other than a connected person and the cost of goods to the donor is not more than RM500.00 per year (financial year), such goods is not required to charge GST and the registered person (donor) is entitled to claim input tax incurred on the purchase of the goods.
If the cost of the goods is more than RM500.00 and is given to the same person in the same year, the donor if he is a registered person, must account for output tax based on the open market value of the goods.