The IRB will audit employers on a regular basis to ensure that they are complying with their income tax reporting obligations, such as timely submissions of the relevant tax statutory forms and proper deduction of Monthly Tax Deduction (MTD). If employers fail to meet their tax obligations, penalties will be imposed.
Therefore, to reduce the risk of being penalised due to non-compliance, employers must ensure that their HR are kept up to date on new tax developments in order to adequately discharge the employer’s tax obligations.
Employer’s legal duties and obligations under the Income Tax Act 1967:
CP39 / PCB | Deduction of Tax from Remuneration: To deduct the tax from an employee's remuneration and remit to the IRB on or before 15 of the following month. |
Form E | Employer Return: To submit the annual employer tax return on or before 31 March of the following year. |
Form EA | Employee's Statement pf Remuneration: To deliver the remuneration statement to employees on or before the last day of February of the following year. |
CP22 | Notification of New Employee: To notify IRB within 30 days from the commencement of employment. |
CP22A | Notification of Cessation of Employment: To notify IRB within 30 days before the date of termination of employment. Death of Employee: To notify IRB within 30 days after being informed of the death of the employee. |
CP21 | Notification of Employee Leave Malaysia: To notify IRB within 30 days before the expected date of employee's departure (when an employww is about to leave Malaysia for more than 3 months). |
Reference: Audit Framework for Employer
