Things That Can Get You in Trouble With the Malaysian Tax Authorities

woman stressed out by taxes

The months from March till June are the busiest months for every working adult in Malaysia. It’s not just the employees who are turning their houses inside-out to look for receipts to prove their eligibility for a tax rebate, but business owners as well will be searching their offices for documents to submit their Income Tax Return Forms.

Filing your tax returns is no small matter. A minor mistake could land you a RM10,000 fine along with an instruction to pay 200% of the underpaid taxes. You may also be banned from travelling abroad because of this.

Submitting the wrong Income Tax Return Form

First of all, you shouldn’t be submitting the wrong forms!

Generally, residents who do not carry on a business will choose Income Tax Form BE (e-BE). The deadline to file the form is by 30 April. Those who are submitting it through e-Filing are given an extension until 15 May. Residents who carry on a business will file Income Tax Form B (e-B) and the deadline for that is 30 June. For more information on the respective forms, please refer to this

ezHasil website screenshot
Photo credit: MyRujukan

Committing any of these offences:

 

business owner looking at graphs
Photo credit: Designermatic

According to the PWC Tax Booklet, part VIII of the ITA 1967 deems these as offences and penalties:

  • failure to furnish Income Tax Return Form (on conviction) will result in a RM200 to RM20,000 fine, imprisonment or even both.
  • failure to furnish Income Tax Return Form (no prosecution instituted) will result in a 300% penalty of tax payable.
  • intentionally evading or assisting another person to evade tax will result in a hefty RM1,000 to RM20,000 fine, imprisonment, or both and 300% of tax undercharged.
  • attempting to leave the country without paying your taxes will result in a fine of RM200 to RM2,000, imprisonment or both.
  • late payment of tax instalment will result in a 10% of tax instalment amount.
tax dice
Photo credit: The Economic Times

Those are just some of the offences. For the full list, please read this. And just in case you were wondering what the chargeable incomes are for resident individuals, you may refer to the table below:

Photo credit: PWC
Photo credit: PWC

Although it’s not legally necessary for you to hire an accountant to file your taxes for you, it’s still advisable to hire one as they are the experts in this area. Furthermore, an accountant specialising in this will be able to advise you on the tax reliefs available to you, depending on the scale of your business and types of expenses.

Kaodim has some professional accountants you can hire for this season. Let us know your needs and any helpful information here, we’ll send you some quotations from our list of accountants for free.

Disclaimer: This does not constitute tax advice and you are advised to consult your lawyer or professional.


written by Esther Chung


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