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Taxation

 

A tax advisor can minimize your tax liability while ensuring compliance with the tax regulations. Inaccurate tax filing and tax evasion intentionally or negligently is not acceptable in Malaysia, where heavy penalty will be imposed if convicted.

 

As per Income Tax Act (ITA) 1967 any person who committed for an offence will be fine either through penalty of imprisonment or both depending on severity or the number of offences.The following table is the summary of the offences, fines & penalties for each offence.
Type Of Offences ITA 1967 Amount Of Fine (RM)
Fail to furnish an Income Tax Return Form. 112(1) 200 to 2,000 or imprisonment or both
Fail to give notice of changeability to tax. 112(1) 200 to 2,000 or imprisonment or both
Make an incorrect tax return by omitting or understating any income. 113(1)(a) 1,000 to 10,000 and 200% of tax undercharged
Give any incorrect information in matters affecting the tax liability of a taxpayer or any other person. 113(1)(b) 1,000 to 10,000 and 200% of tax undercharged
Wilfully and with intent to evade or assist any other person to evade tax. 114(1) 1,000 to 20,000 or imprisonment or both and 300% of tax undercharged
Assist or advise others to under declare their income. 114(1A) 2,000 to 20,000 or imprisonment or both

 

Attempt to leave the country without payment of tax. 115(1) 200 to 2,000 or imprisonment or both
Obstruct any authorized officer of IRBM in carrying out his duties. 116  1,000 to 10,000 or imprisonment or both
Fail to comply with an order to keep proper records and documentation. 119A 300 to 10,000 or imprisonment or both
Fail to comply with a notice asking for certain information as required by IRBM. 120(1) 200 to 2,000 or imprisonment or both
Fail to give notice on changes of address within 3 months. 120(1) 200 to 2,000 or imprisonment or both

 

Prevention is always better than cure

  • Review your tax returns and declarations periodically,  seek professional advice when necessary.
  • Engage a tax professional to conduct a tax compliance review/health check on your tax filing regularly.

 

What should you do when you are being investigated?

  • Do not obstruct the tax investigators from performing their duties should your premises face a raid.
  • Seek professional advice before the time limit to make a voluntary disclosure to IRBM.
  • You are required to provide any information and documents that IRBM requests. Do ensure that the relevant facts provided are correct and complete.
  • Be absolutely sure of your answers to the tax investigators, the facts that are to be disclosed should preferably be supported by documentary evidence.
  • Appoint a professional adviser to represent you during the investigation.