Dear Valued Clients,
Welcome to our E-Newsletter April 2019
The 2019 tax season is now in full swing. No matter which country you live in, there are always taxes to pay to help keep the government running. Malaysia’s income taxes are structured as a progressive system. In other words, only income above certain thresholds will be taxed at a higher rate, which is more flexible than a flat bracket rate. To prepare you in this tax season, we would like to share with you some of the important dates and latest movement in the tax environment in Malaysia.
Inland Revenue Board of Malaysia: Singapore Income Will Not Be Taxed
According to the recent announcement of the Inland Revenue Board of Malaysia (LHDN), all income received from employment exercised in Singapore is not taxable in Malaysia. LHDN chief executive officer clarified that this is because this Singapore income is not generated from the exercising of employment in Malaysia.
The Income Tax Act 1967 (ITA 1967) has stipulated that “For an individual residing in Malaysia for a period exceeding 183 days, the individual is deemed to be a resident for tax purposes in Malaysia”. Having said that, if the individual does not receive any income generating from Malaysia and only receives employment income sourced from Singapore, then the individual is still not liable for tax in Malaysia.
Important Tax Reminders
1. Income Tax (Form E) Submission
If you are an employer, you should be now preparing the Form E (Return Form of Employer – Remuneration for the Last Calendar Year) and Form EA for your employees. The laws of Malaysia have mandated the employers to furnish EA form (EA for private sector employees; EC for public sector employees) to all their employees so that he or she can file his or her personal tax return. It is the responsibility of the employer to make sure that the statement is ready on or before the last day of February of the following calendar year for each employee (inclusive of new hires, existing staff, and resigned employees).
Please note that for Companies, LLP, Trust Bodies, and Co-operative Societies, it is a mandatory requirement to file the Form E (Borang E) by upcoming 31 March (grace period for e-filing: until 30 April 2019) even the organisation has no employee OR dormant OR has not commenced business during the calendar year 2018. Failing to comply with the requirement will land a big fine at your doorstep. You will be slapped with the fine penalty of RM200 to RM20,000 or face imprisonment for a term not exceeding 6-months, or both.
2. Personal Income Tax Deadline
Please mark down the tax filing deadlines in your calendar:
- 30 April 2019: BE Form (for individuals whose income is without business source)
- 30 June 2019: B Form (for individuals whose income includes business source)
- 30 April 2019: M Form (for a non-resident individual – resident in Malaysia for less than 90 days in the tax year whose income is without business source)
- 30 Jun 2019: M Form (for a non-resident individual – resident in Malaysia for less than 90 days in the tax year whose income includes business source)
- 30 June 2019: P Form (for a partnership)
As we, 3E Accounting Malaysia, continue on our journey towards success, we remain committed to adding real value to our clients, shareholders, and stakeholders, while upgrading our services. We thank you for all your support!
Read More in our E-Newsletter April 2019.