1. A Simple Guide for Malaysian Businesses
As a business owner in Malaysia, you’ll need to file certain tax forms to stay compliant with the Inland Revenue Board of Malaysia (LHDN). Below is a guide to the most common tax forms you should know about.
2. Form C: Income Tax Return for Companies
Form C is the official tax return form for companies in Malaysia. It’s used to declare your company’s total income, business expenses, capital allowances, and tax payable for the relevant Year of Assessment (YA). All companies must file Form C, regardless of whether they made a profit or loss except those exempt under special orders.
Submission for Form C has to be made 7 months after the end of the financial year. For example, if your company’s financial year ends on 31 December 2024, the due date to file Form C is 31 July 2025.
Filing Form C is how your company determines and pays its corporate income tax, typically at a rate of 15%–24% depending on your SME status and taxable income. Failing to file can result in penalties, late payment charges, or even legal action.
3. Form B: Income Tax Return for Sole Proprietors & Partnerships
Form B is for sole proprietors and partnerships to report business income and taxes. Form B is for individuals who earn business income under their own name or through a partnership. It combines both personal and business income in a single form and allows you to claim tax reliefs.
Form B should be submitted by 30 June each year or 15 July with e-filing. Sole proprietors and partnerships are taxed based on personal income tax rates, which are progressive (0%–30%) unlike companies.
Submitting Form B ensures your business income is properly declared, and you stay within the law. Filing late results in fines and late payment penalties.
4. Form E: Employer’s Annual Return
Form E is an annual declaration form for employers to report the total salaries, benefits, and tax deductions paid to employees throughout the year.
All registered employers, even if you only have one employee, including directors have to submit Form E. Form E must be submitted by 31 March each year. Submission can be done online via e-Filing.
Form E is essential to ensure that employee remuneration is properly documented and taxed. It also supports compliance with statutory deductions like EPF, SOCSO, EIS. Failure to file can result in a penalty of RM200–RM20,000 or imprisonment up to 6 months.
5. CP204: Advance Tax Payment for Companies
Form CP204 is used by companies to declare and pay estimated income tax in advance for the upcoming financial year. This is part of Malaysia’s self-assessment system, where companies predict their taxable income and pay it in monthly installments.
All active companies except exempted SMEs for the first two years. Submission has to be made at least 30 days before the start of the new financial year. For example, if your new financial year begins on 1 January 2025, CP204 must be submitted by 2 December 2024.
Submitting CP204 and paying tax in installments helps spread your tax burden across the year. Underestimating by more than 30% can result in a 10% penalty on the difference. Non-submission or non-payment can also lead to fines.
6. EA Form: Employee’s Tax Information
Form EA is a yearly statement issued by the employer to each employee, summarizing their total income, bonuses, EPF contributions, PCB deductions, and benefits-in-kind for the previous year.
Every employer must issue the EA Form to each employee who has received remuneration. Form EA should be submitted by 28 February every year before tax season begins.
Employees need the EA Form to file their personal income tax return. It helps LHDN verify declared income and ensures that all taxes have been deducted correctly. Delayed or missing EA Forms can lead to employee complaints and compliance issues.
Resources: www.hasil.gov.my