What is Inland Revenue Board of Malaysia (LDHN)?

If you manage a team or run payroll, you’ve likely come across LHDN at some point. But what exactly does it do, and why should employers pay attention?

Whether it’s handling PCB deductions or filing yearly reports, understanding the role of the Inland Revenue Board of Malaysia is a must for staying compliant and avoiding last-minute stress.

What is LHDN (Lembaga Hasil Dalam Negeri Malaysia)

LHDN, or Lembaga Hasil Dalam Negeri Malaysia, is Malaysia’s main government agency for tax administration.

It’s responsible for making sure individuals and companies pay the right amount of tax based on the country’s tax laws.

You as employer will deal with LHDN when it comes to:

Registering your business and employees for tax purposes
Deducting monthly tax from employee salaries (known as PCB)
Filing forms and tax reports every year

What is the Inland Revenue Board of Malaysia (LHDN)?

The Inland Revenue Board of Malaysia (IRBM) was established in 1996 as a government agency under the Ministry of Finance.

It was set up to improve the efficiency of tax collection and to manage the country’s direct tax system more effectively.

LHDN’s core responsibilities include:

Collecting income tax from individuals and businesses
Issuing Tax Identification Numbers (TIN)
Managing tax compliance and enforcing tax laws
Running audits, tax investigations, and compliance checks
Overseeing tax-related policies and advice

In short, LHDN is the government’s official channel for everything related to personal and corporate income tax.

They’re also responsible for things like stamp duty, monthly tax deductions, and tax refunds.

Services Provided by LHDN

The Inland Revenue Board of Malaysia (LDHN) offers several key services that directly involve employers.

These services help companies stay compliant with tax laws while managing their employees' income tax matters properly.

Below are the services provided by LDHN that matter most for HR and payroll teams:

Income Tax Registration

When you hire a new employee, one of the first steps is to register them with LHDN.

This means creating a tax file for the employee under the company’s account so that monthly deductions and future filings are tracked properly.

If your company is new, you'll also need to register the business for corporate tax purposes.

Tax Identification Number (TIN) Issuance

Every individual and company is assigned a Tax Identification Number (TIN) by LHDN.

It is required for all tax-related submissions, including PCB (Potongan Cukai Bulanan) and annual tax returns.

If a new employee doesn’t have a TIN, the employer can request one through the LHDN system.

Monthly Tax Deduction (PCB) Monitoring

PCB is the monthly tax deduction that employers must make from their employees’ salaries.

LHDN provides tools (such as e-PCB and e-Data PCB) for calculating and submitting these deductions.

Monitoring this correctly is crucial to avoid underpayment or late submissions, which could lead to penalties.

Corporate Tax Services

LHDN also handles corporate income tax, which includes the tax your business pays based on its annual profits.

This involves estimating tax payable, submitting tax returns (Form C or Form E), and making payments.

The system is designed to support businesses of all sizes with clear filing procedures.

Stamp Duty Assessment

If your company deals with legal documents like tenancy agreements, property sales, or share transfers, you’ll likely need to go through stamp duty assessment with LHDN.

But now, stamp duty can be done online via the STAMPS system.

Tax Audits

LHDN may also conduct audits or investigations to verify that companies and individuals are paying the correct amount of tax.

If you're selected for an audit, they’ll request specific documents such as payroll records, financial statements, and previous tax submissions.

Employer Responsibilities with LHDN

Every employer in Malaysia has specific responsibilities to fulfil with the Inland Revenue Board of Malaysia (LHDN).

These tasks are legal obligations that help keep your business in good standing and your employees’ tax matters in order.

Registering Employees with LHDN

When you hire new employees, they must be registered with LHDN so that tax deductions can begin.

If they already have a Tax Identification Number (TIN), you’ll need to include that in your company’s payroll system. If they don’t, you can register them through LHDN’s portal.

Submitting CP22 and CP22A Forms

There are specific forms that must be submitted during key moments of employment:

CP22: Submit this form when you hire a new employee. It must be submitted within 30 days from the start of their employment.
CP22A: Use this form when an employee resigns or leaves your company. It should be submitted at least 30 days before the employee’s last working day, especially if they’re resigning or retiring.

These forms are important for tracking employment changes and ensuring the employee’s tax obligations are properly managed.

Deducting and Remitting PCB (Potongan Cukai Bulanan)

Each month, you must deduct PCB (Monthly Tax Deduction) from your employees’ salaries based on LHDN’s guidelines.

The amount must then be remitted to LHDN before the 15th of the following month. Failure to do so can lead to fines or interest charges.

Submitting EA Forms to Employees

At the beginning of each year, usually by the end of February, you must issue an EA Form to every employee.

It shows their total earnings and tax deductions from the previous year and is needed for them to file their personal income tax.

Filing Form E Annually

Form E is a summary report submitted to LHDN every year. It lists all your employees, their TINs, and their total income.

Form E must be submitted by 31 March of the following year. If filed late, your company may face penalties.

Employer Forms Under LHDN

The Inland Revenue Board of Malaysia (LHDN) requires employers to submit several important forms based on employee movements and reporting needs.

Each form has a specific purpose and timing. Here are the key ones every HR team or employer should be familiar with:

CP21: Notification of Employee Leaving the Country

If an employee is leaving Malaysia for a long period or permanently (excluding short holidays), you must inform LHDN using Form CP21.

This needs to be submitted at least 30 days before their departure. Failing to do this may cause complications with the employee’s tax clearance.

CP22: Notification of New Employee

This form is used to inform LHDN about a new hire. Employers must submit CP22 within 30 days from the date of employment.

It includes basic employee details and their tax identification information.

CP22A: Notification of Resignation or Termination

Let’s say an employee resigns, retires, or is terminated. You need to submit form CP22A must at least 30 days before their last working day.

It helps LHDN assess the employee’s final tax position and, if needed, issue a tax clearance letter.

CP58: Commission Reporting for Agents or Distributors

When your company pays commissions or incentives to agents, dealers, or distributors (who are not on your regular payroll), you need to report this via Form CP58.

It is usually submitted once a year and helps LHDN track taxable income from third-party arrangements.

Tax Payments and Filing Deadlines

Knowing tax deadlines is essential for employers to avoid fines and maintain good standing with the Inland Revenue Board of Malaysia (LHDN).

These deadlines cover both monthly and annual tax obligations related to employee income and company profits.

Monthly PCB Remittance

Every month, you must deduct Potongan Cukai Bulanan (PCB) from your employees’ salaries.

This deduction must be submitted to LHDN by the 15th of the following month. For example, January’s PCB must be paid by 15 February.

Annual Filing Deadlines

Employers must also submit the following tax documents annually:

EA Forms: Issued to employees by end of February each year. This is a summary of each employee’s annual income and tax deductions.
Form E: Submitted to LHDN by 31 March. This is a declaration of the company’s total employee payroll for the previous year.

All forms can be submitted through LHDN’s online platforms (covered in the next section), and it's best to prepare early to avoid system overload near the deadline.

Corporate Tax Payments

In addition to employee-related filings, your company must also pay corporate income tax if applicable. This includes:

CP204: Estimate of tax payable for the current year.
Form C: Annual corporate tax return, submitted within 7 months after the end of your financial year.

LHDN Online Platforms for Employers

To make tax submissions easier and faster, the Inland Revenue Board of Malaysia (LHDN) offers several online platforms for employers.

These tools are useful for handling monthly PCB, submitting forms, and making payments without the need to visit a branch.

MyTax Portal

The MyTax Portal is a central hub for all tax-related services. Employers can:

View employee tax files
Check submission status
Access payment history
Update company and employee information

Visit: https://mytax.hasil.gov.my

e-PCB System

The e-PCB is an online system for calculating and submitting monthly tax deductions (PCB).

It’s suitable for companies that don’t use payroll software and want to manage deductions manually.

Visit: https://e-pcb.hasil.gov.my/

e-Data PCB

For companies with larger payroll systems, e-Data PCB allows you to upload bulk data for multiple employees.

You’ll need to use a CSV file format that follows LHDN’s layout guide. This system is more efficient for medium to large businesses.

Visit: https://edata.hasil.gov.my/

ByrHASiL (Tax Payment Portal)

ByrHASiL is LHDN’s online payment gateway. It supports payments for:

Monthly PCB
CP204 corporate tax
Other tax-related bills

It works with multiple banks and provides instant receipts, which are important for audit purposes.

Visit: https://byrhasil.hasil.gov.my/

Common Issues Faced by Employers

Even with the right systems in place, employers in Malaysia may still face a few common problems when dealing with the Inland Revenue Board of Malaysia (LHDN).

These issues can lead to penalties, extra admin work, or confusion for both employers and employees.

Late Submission Penalties

One of the most frequent problems is missing tax deadlines, especially for PCB payments or annual forms like Form E.

Late submissions can result in fines or interest charges, which add up quickly over time.

These delays usually happen due to poor record-keeping, last-minute preparation, or lack of awareness about the due dates.

Errors in PCB Deductions

Another issue is wrong PCB calculation. This can happen if you:

Use outdated tax tables
Enter incorrect salary details
Forget to adjust deductions for bonuses or overtime

Incorrect deductions can create trouble for both the employer and employee.

Employees may underpay or overpay their income tax, while employers may be held responsible for the mistake.

Inaccurate Employee Information

LHDN submissions rely heavily on accurate employee details like full names, TIN numbers, and IC/passport information.

If there’s a mismatch between what you submit and what LHDN has on file, it could lead to rejection of forms, delays in processing, or errors in the employee’s tax account.

To avoid these problems, have a structured payroll process and double-check all data before submission.

Using the right tools and training your HR/payroll team can make a big difference.

How to Contact LHDN

Sometimes you may run into issues that need direct help from the Inland Revenue Board of Malaysia (LHDN).

Whether you’re unsure about a form, need help with the e-PCB system, or want to resolve a tax error, here are the best ways to get in touch:

HASiL Care Line

You can contact LHDN’s official call centre for general tax questions, filing help, or portal support. The team can assist with employer-related matters, including PCB, Form E, and company tax accounts.

Phone: 03-8911 1000 (within Malaysia)
Operating Hours: Monday to Friday, 9.00 AM – 5.00 PM

HASiL Live Chat

If you prefer typing instead of calling, HASiL Chat is available on the MyTax portal. It’s a live chat feature where you can ask questions and get help in real time from LHDN officers.

Visit: https://mytax.hasil.gov.my

Visit LHDN Branches

For more complex issues or when documents need to be submitted in person, you can visit any LHDN service branch.

Most states and major towns have at least one branch. You can find locations on the official website under “Contact Us.”

Pro tip: It’s better to make an appointment online or go early, as queues at peak season (e.g., during annual filing) can be long.

FAQ

How do I register my business with LHDN?

You can register your business by submitting Form CP600B to the nearest LHDN branch or online via the e-Daftar service. This process will give your company a Tax Identification Number (TIN) and create a business tax file.

What is the difference between CP22 and CP22A?

CP22 is used when you hire a new employee. It notifies LHDN of their employment status. CP22A is submitted when an employee resigns, retires, or leaves your company. It helps LHDN assess their final tax obligations before they exit.

How can I access the e-PCB system?

You can access e-PCB at https://e-pcb.hasil.gov.my. You’ll need to register your company and get login credentials. The system lets you calculate and submit monthly PCB deductions for your employees.

Do I need to submit Form E every year?

Yes. All employers, even those with only one employee, must submit Form E every year typically by 31 March. This form lists employee earnings and PCB deductions for the previous calendar year.

What happens if I miss the PCB deadline?

If you miss the 15th of the month deadline for PCB remittance, LHDN may impose late payment penalties or interest charges. This can accumulate over time and affect your company’s tax record. It’s best to pay early or set up reminders to avoid missing deadlines.

Your Next Great Hire Could Be One Click Away

Finding skilled, committed workers doesn’t have to be difficult.

AJobThing connects you with the right people, whether local or foreign, who are ready to work and grow with your business.

Post your job today and build a team that supports your mission and values. Let’s make your workplace stronger, together.