Employer Responsibilities in Malaysia: What You Need to Know
Every year, employers in Malaysia have multiple legal and financial responsibilities to ensure compliance with tax, payroll, and labor laws. These include tax deductions, employee benefits contributions, and statutory reporting. Employers must manage EPF, SOCSO, EIS, and HRDF payments while also ensuring proper employment records. However, one of the most critical responsibilities is fulfilling LHDN tax reporting requirements.
Understanding LHDN Employer Obligations
The Inland Revenue Board of Malaysia (LHDN) requires employers to deduct, report, and submit employee income tax accurately. The most important requirements include:
- Monthly Tax Deduction (PCB/MTD) – Deducted from employees’ salaries and remitted to LHDN.
- Form EA – Issued to employees by 28 February for personal tax filing.
- Form E – Submitted by 31 March to declare total employee remuneration.
- Form CP58 – Issued to commission-based earners earning RM5,000 and above annually.
March 2025: What Employers Must Submit
Employers must ensure Form E is submitted and CP58 is issued by 31 March 2025. These submissions help LHDN track employee earnings and tax deductions while ensuring businesses comply with the Income Tax Act 1967.
Final Reminder: Get Ready Early!
To avoid penalties and last-minute stress, businesses should start preparing for LHDN tax submissions early. Using automated payroll and tax solutions like SYNC can help ensure smooth compliance and timely reporting. Start your preparation today.
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