Corporate Income Tax Rates for Sdn Bhd
A Sdn Bhd company in Malaysia is subject to corporate income tax based on its chargeable income.
For qualifying SMEs, the progressive tax rate typically works as follows:
- 15% on the first RM150,000 of chargeable income
- 17% on income between RM150,001 and RM600,000
- 24% on income above RM600,000
These tiered rates are designed to support small and medium enterprises by reducing the tax burden on lower levels of profit.
Form C – Annual Corporate Tax Return
Form C is the main tax return form for Sdn Bhd companies. It is used to declare:
- company income
- allowable deductions
- tax adjustments
- total tax payable
Companies must submit Form C within seven months after the end of their financial year. Failure to submit it on time may result in fines or other penalties.
Form CP204 – Estimated Tax Payable
Every company must estimate its expected tax for the year through Form CP204.
Key requirements include:
- Submit the estimate within 3 months of starting operations or at the start of a new assessment year
- Pay the estimated tax in monthly instalments throughout the year
This system helps businesses spread out tax payments instead of paying the entire amount at once.
Form E – Employer’s Annual Return
If your company hires employees, you must submit Form E to declare:
- total number of employees
- salaries and benefits paid
- tax deductions made for employees
This form is usually due by 31 March each year, and failing to submit it may result in penalties.
Form EA – Employee Income Statement
Employers must also provide Form EA to each employee.
This document summarizes:
- total annual salary
- benefits or allowances received
- tax deductions from the employee’s income
Employees then use the information in Form EA when filing their personal income tax.
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