How To Pay Income Tax In Malaysia

by Pang Tun Yau

Income Tax

With income tax season well underway, we’re sure most of you have already filed your income tax for the previous assessment year. For most of us, the mandatory monthly tax deductions (MTD) set by our employers would have already covered our income tax payments for the year, and filing our taxes means getting an income tax refund from the government.

But, for those who has a secondary income or run their own businesses, that isn’t always the case. If you have filed your income tax and there is a deficit to be paid, the Inland Revenue Board of Malaysia (IRB) offers a wide range of methods to pay for your taxes – ensuring there are no excuses for not paying your income tax on time.

Here are all the ways you can pay for your income tax in Malaysia.

Over-the-counter at IRB Malaysia counters

This option is available for registered businesses only, and does not apply for individuals.

There are three IRB payment counters in Malaysia: Jalan Tunku Abdul Halim Payment Counter for Peninsular Malaysia, Kuching Payment Counter for Sarawak & Kota Kinabalu Payment Counter for Sabah. Every payment needs to be attached with CP 207 payment slip which has been sent to the company.

Over-the-counter at Banks and Pos Malaysia outlets

Both individuals and businesses can pay their income taxes over-the-counter at selected banks and Pos Malaysia outlets. The list of banks are:

  • CIMB Bank
  • Public Bank
  • Maybank
  • Affin Bank
  • Bank Rakyat
  • RHB Bank
  • Bank Simpanan Nasional

Note that only cash payments are accepted at Pos Malaysia outlets. For individual taxpayers, ensure that the following information is included in the payment slip:

  • Payment Code
  • Name of Taxpayer/Employer
  • Income Tax Number/Employer number
  • IC number
  • Year of assessment
  • Payment amount

For businesses, use the CP 207 payment slip as a guide to fill up IRBM's Bank In Slip provided at the bank to make payment. The customer's copy of the bank in slip must be kept as a proof of payment.

Online

By far, online payment is the easiest and most efficient way to pay income tax in Malaysia. The best would be via the IRB’s own online platform, ByrHASIL. It’s the only online platform that supports payment by credit cards (Visa, Mastercard, and American Express), so you can earn some points or cashback for paying income tax – just note that there is a processing fee of 0.8% imposed for credit card payments.

Besides ByrHASIL, a host of online banking platforms can also be used to pay for income tax, including:

ATM

This option is available for individual taxpayers only, and does not apply for registered businesses.

Payment of individual income tax via auto teller machines (ATM) can only be done at three banks:

  • Public Bank
  • Maybank
  • CIMB Bank

You are required to have an ATM card from the respective bank’s ATM to proceed with payment. You must also provide your income tax reference number to complete the transaction.

Cash & Cheque Deposit Machines

This option is available for individual taxpayers only, and does not apply for registered businesses.

Likewise, payment of individual income tax via cash or cheque deposit machines (CDM) can only be done at two banks:

  • Public Bank (cheque)
  • CIMB Bank (cash)

Payment by post

This option is available for registered businesses only, and does not apply for individuals.

Payment of income tax by post must only be made with crossed cheques or bank drafts, and made payable to "THE DIRECTOR GENERAL OF INLAND REVENUE". The cheque or bank draft must contain the name of the company, the tax reference number, installment number, year of assessment and the address on the reverse side.

While sending cash via post isn’t illegal, the IRB does not accept cash sent by post to pay for income tax. Neither are post-dated cheques, and cheques issued by banks outside Malaysia.

All cheques and bank drafts must be submitted to the Kuala Lumpur Payment Centre or the collection unit in Kuching or Kota Kinabalu.

Tele-banking

This option is available for individual taxpayers only, and does not apply for registered businesses.

The only reason why we’re listing this option is because it remains one of the supported channels to pay for income tax. Maybank’s Kawanku Phone Banking service can be used to pay for individual income tax, if you have a savings account with Maybank.

But seriously, there are better avenues to pay for income tax listed here.

Overseas money transfer

If you happen to be overseas and have no other means to pay for your income tax, you can still do so via electronic money transfer as well as bank draft.

a) Electronic Money Transfer via TT, IBG, & EFT

If the taxpayer wishes to pay tax via Telegraphic Transfer (TT), Interbank GIRO Transfer (IBG) or Electronic Fund Transfer (EFT, they will have to call the HASIL Care Line to receive the payment procedure at 1-800-88-5436 (call within Malaysia) or 603-7713 6666 (call from oversea). Alternatively, they can also drop an email at [email protected]

Taxpayers who made their payment via TT/IBG/EFT must provide the additional information to enable the IRB to update their tax accounts:

  • Payer name
  • Tax reference number
  • Transaction reference number for the TT/IBG/EFT
  • Year of assessment
  • Payment code (refer to table below)
  • Installment number, if any. If not stated, IRBM will consider current month as the installment number
  • Date of payment
  • Payment amount


(Image: IRB)

For this mode of payment, an official receipt will be issued after the amount is received by the bank, and after the complete payment information has been received by the IRB. Any incomplete information will result in a delay in the receipting process, and a late payment penalty could be imposed, so be sure that the information is furnished accurately.

Taxpayers who have made payment via telegraphic transfer must furnish the following additional information to enable IRBM to update their tax account:

b) By Bank Draft

Payment of income tax from oversea by monetary transfer using bank draft requires the payer to submit the following instrument:

  • Payable to: Director General of Inland Revenue
  • Name and address of payer bank must be “local paying bank” or “local correspondence bank” so that the draft becomes a local cheque.

In addition, the taxpayer may buy a bank draft in currencies other than Malaysian Ringgit (RM), but must ensure that the amount paid is accurate based on the exchange rate on payment day, because payment will be recorded based on the exchange rate on the day the funds are credited.

Also, taxpayer as well as payment details must be clearly written on the back page of the bank draft. Completed bank drafts are to be posted to:

Inland Revenue Board Malaysia
Kuala Lumpur Payment Centre
Ground Floor, Block 8A,
Government Offices Complex,
Jalan Tunku Abdul Halim,
50600 KUALA LUMPUR, MALAYSIA

No excuses

With an extensive list of payment methods – both offline and online – available, the IRB ensures that paying your taxes is an easy process, no matter where the taxpayer may be.

While paying our taxes is a necessary thing, it doesn’t mean we can’t get a little out of it. Credit cards that offer cashback and/or rewards points could be worth paying the extra 0.8% processing fee, as long as you get something better in return. Check out our list of best credit cards for online transactions for more details – just be sure that the card’s fine print allows for cashback and/or points accumulation for tax- or government-related payments.

Check out the RinggitPlus Income Tax page for more helpful guides and tips.