8 out 10 HR don’t do this for IRB (According to our experience)

8 out 10 HR don’t do this for IRB
(According to our experience)

HR know PCB deduction But …

It is important to understand for the obligations under under the Income Tax Act and failure to comply with these obligations would result in penalties to be imposed.

Notification of new employee

An employer is required to notify IRB via Form CP 22 within 1 month of the date of commencement of employment

Notification of resigned employee

An employer is required to notify IRB via Form CP 22A at least 30 days before the date of cessation of employment

Notification of departure from Malaysia for a period exceeding 3 months

An employer is required to notify IRB via Form CP 21.

The employer is required to withhold any money in the employer possession owing to the employee until 90 days after IRB receive Form CP 21 or upon receipt of the tax clearance letter, whichever is early.

The penalty on IRB tax clearance letter

Delay in submitting the application for tax clearance may be subjected to penalty. The penalty will be in the form of fines between MYR 200 and MYR 20,000 and imprisonment for up to six months.

LHDN may take legal action against the employer who fails to pay the outstanding tax as per the Tax Clearance Letter.