Personal Income Tax
Withholding Tax Service Malaysia
Personal income tax is determined based on the tax liability of an individual including the individual’s residency and the amount of chargeable income. For Malaysian residents, the personal income tax is payable at a progressive rate of 0% to 25% through a yearly assessment. Whereas non Malaysian residents are subjected to withholding taxes on certain types of income.
Do note that residents and non Malaysian residents are only subjected to tax on a Malaysian-sourced income. Remittances of foreign-sourced income into Malaysia is exempted from taxation. Tax rules will also differ based on residency, though assessment for all is done on a yearly basis (running from January 1 to December 31).
Employers’ Responsibilities For Personal Income Tax
Form CP 22: Notification of New Employee
Form CP 22A: Cessation of Employment
Form CP21: Departure from Malaysia for a Period Exceeding 3 Months
Form E: Employees’ Employment Income
Form EA: Statement of Remuneration
*Tax withholdings from employment income are covered by the monthly tax deduction scheme. For more information regarding this scheme, kindly visit www.hasil.gov.my.
Employees/ Sole Proprietorship/ Self Employed Responsibilities For Personal Income Tax
Form BE (For Resident Individual Who Doesn’t Carry On Business)
Form B (For Resident Individual Who Carry On Business)
Form BT (For Resident Individual; Knowledge Or Expert Worker)
Form M (For Non-Resident Individual)
Form MT (For Non-Resident individual; Knowledge Or Expert Worker)
Form M (For Non-Resident Individual With Business Income)
Form MT (For Non-Resident Individual; Knowledge Or Expert Worker With Business Income)
*Personal income tax can be filed via ezHASil e-Filing. It can also be done via a paper-based tax return which can be collected from any LHDN branch or printed from the IRB website.
Partnerships’ Responsibilities For Personal Income Tax
Partnerships do not pay tax but are still required to file an annual income tax return with Form P. This is to show all income earned as well as business expenses deductions.
Should you require further assistance and information regarding personal income tax and the filing procedure, our team at Klozer is ready to help. So get in touch with us now and we will schedule an appointment with you soon.