Pre arrival procedures

An expatriate who requires a work visa must apply for their visa before
taking up an employment in Malaysia.

Employment visas

An expatriate taking up employment in Malaysia must apply for an employment pass before commencing employment. A local sponsor, who is usually the employing company in Malaysia, is required to support the application.
If the expatriate’s spouse and children also relocate to Malaysia, they will require a dependent’s pass.

Tax year

The tax year or year of assessment (YA) for individual tax runs from 1st January to 31st December. Malaysia adopts a current year basis of assessment.
This means that income for the calendar year 2010 is taxable in the YA 2010.

Tax returns and compliance

An employee has to file an income tax return by 30 April each year. There are schedular tax deductions (STD, i.e. pay-as-you-earn scheme) to be made by the employer for remuneration paid to an employee.
The employer is required to file a leavers form with the tax authorities no later than 1 month from the employee’s expected date of departure. For tax clearance purposes, the employer is required to withhold monies due to the employee from the date of notification of departure from Malaysia.

Tags: Expatriate, working, malaysia

Who Wins In A Tax Audit

1) Taxpayer should be able to handle and manage tax audits themselves. Taxpayers may consider engaging tax professionals who specialize in handling tax audits to assist on specific technical matters

2) Be ready to answer questions and provide the necessary information when requested by the IRB

3) Be polite and professional in dealing with the IRB officials

4) Do not underestimate the IRB officials as they are professionals with the relevant knowledge, training and experience

5) Finalise the tax audit within a short time and narrow down the list of issues to be dealt with to resolve the matter quickly

Tags: Taxation, Audit, IRB