COMPANY TAX RATE
COMPANY TAX ESTIMATE - CP 204
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Company with paid up capital not more than RM2.5 million and gross business income of not more than RM50 million
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On first RM150,000 -15%
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RM150,001 to RM600,000 -17%
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RM600,001 and Subsequent Balance-24%
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Company other than the above category-24%
INDIVIDUAL TAX
Tax is imposed annually on individuals who receive income in respect of :
a) Gains / profit from a business;
b) Gains / profit from employment;
c) Dividends, interest or discounts;
d) Rent, royalties or premiums;
e) Pensions, annuities or other periodic payments; and
f) Gains / profit not falling under any of the foregoing paragraphs.
The Income Tax Act 1967 (ITA) enforces administration and collection of income tax on persons and taxable income.
The Inland Revenue Board of Malaysia (IRBM) is one of the main revenue collecting agencies of the Ministry of Finance.
CP204 is a tax payment form used in Malaysia for companies to estimate and pay their taxes in advance. Companies are required to estimate their tax payable and make payments in equal monthly installments starting from the second month of their basis period for a year of assessment.
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Estimate Your Company’s Profit: Determine the expected profit for the year by considering your revenue, expenses, and any other financial factors that may affect your profit.
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Apply the Tax Rate: Once you have an estimated profit, apply the current corporate tax rate to calculate the estimated tax payable.
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Consider Previous Year’s Tax: The tax estimate must not be less than 85% of the revised tax estimate or tax estimate for the immediately preceding Year of Assessment.
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Submit Form CP204: Submit the estimated tax payable using Form CP204 to the Lembaga Hasil Dalam Negeri Malaysia (LHDN) within the stipulated time frame.
INDIVIDUAL TAX RATE for Non resident Individual
A non-resident individual is taxed at a flat rate of 30% on total taxable income.
A qualified person (defined) who is a knowledge worker residing in Iskandar Malaysia is taxed at the rate of 15% on income from an employment with a designated company engaged in a qualified activity in that specified region.
An approved resident individual under the Returning Expert Programme having or exercising employment with a person in Malaysia would also enjoy a tax rate of 15% for five years on income from an employment.
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FORM E,EA & BE
FORM E- Form E is a declaration made by the employer to LHDN on the number of employees, total remuneration paid to them, as well as the total amount of tax deductions for the year.
FORM EA - Form EA is a summary of the employee’s earnings from the employer for the year.
FORM BE -the process for filing your income tax returns depends on the type of income you earn, and subsequently, what type of form you should be filing. Resident individuals who do not carry on a business will file the BE form