Corporation and businesses’ owners are advised to keep itself uptodate on their statutory obligations to IRBM. Therefore it is advisable to have knowledge of their statutory obligations which are administered by IRBM.
1. Yearly remuneration statement (EA/EC Form)
With effect from year of assessment 2009, every employer shall, for each year, prepare and render to his employee statement of remuneration of that employee on or before the last day of February in the year immediately following the first mentioned year.
Forms to be used:
a. ‘EA’ — Remuneration Statement for Private Employees.
b. ‘EC’ — Remuneration Statement for Government Employees.
Form EA or EC is not required to be sent to IRBM.
2. Notification of new employee
The employer must notify the nearest assessment branch within one month from the date of commencement of employment of an individual who is subject to or may subject to income tax using Form CP22.
Failure to notify IRBM will render an employer liable to prosecution and on conviction, liable to a fine of not less than RM200 and not more than RM2,000 or to imprisonment for a term not exceeding six months or to both.
The employer also be responsible for any tax due from the above mentioned employee.
3. Retire or cessation from employment
In event that an employee is about to retire or subject to MTD scheme and the employer has not made any deduction, or is about to leave Malaysia permanently, the employer should notify IRBM at least at least thirty days before the date the employee ceases employment.
The employer must withhold money payable to the employee until they receive a Clearance Letter from the Assessment Branch.
However, the employer is not required to send notification about the employee ceasing employment or withhold money payable to him if:
a. Employee is subject to MTD and deduction has been made by the employer.
b. Employee’s remuneration is less than the minimum income subject to MTD.
c. Employer is aware that the employee is to be employed elsewhere in Malaysia.
The Form used is different .It is dependent on whether they are Private Sector Employees or Public Sector Employees. CP 22A shall be used for Private Sector Employees whilst CP22B is used for Public Sector Employees.