Talenox Editor’s note: This blog post, originally written in January 2022, has been updated to reflect the latest regulatory changes for the year 2024. Thank you for your continued support.
According to the Income Tax Act, if you forget to file your income tax forms in time, you may get fined RM200 to RM20,000, face imprisonment (not exceeding six months) or both. Don’t risk this for the new year.
Furthermore, you’ll want to ensure that you can file the form online. That’s because Lembaga Hasil Dalam Negeri (LHDN) / Inland Revenue Board of Malaysia (IRB) mandated this practice for the Year of Assessment (YA) 2018 and onwards.
Feeling nervous? Figuring out how to file Borang E can be an overwhelming annual process that requires a lot of re-learning each year. That is why it is extremely important to understand the ABCs of Borang E.
1. What is Borang E? And who must I file it for?
It is a declaration report and it is submitted by every employer to LHDN every year; it serves to report:
- Total number of employees within the company;
- Number of new hires;
- Employer’s details;
- Each employee’s details;
- A list of each employee’s income details;
- Those with annual gross remuneration of RM 34,000 and above.
- Those with monthly gross remuneration of RM 2,800 and above (including bonuses, except previous years’ salary arrears).
What if some of my employees’ income is less than the stipulated? In that case, you should indicate a “0” in part A of the employee data section.
Contracted employees or part-timers: do I need to report in Borang E as well? Yes. From interns to contracted employees, part-timers to full-timers; all individuals employed in any kind of arrangement under your company must have their details reported in the form accordingly.
What about employees who have quit work and left Malaysia?
- If you’re the employer, you will need to give notice of said employee leaving Malaysia 3 months or more. This notice has to be given to the LHDN branch where the employee’s income tax file is located; this is so the Certificate Tax Settlement can be issued.
- You will also need to withhold the employee’s salary due to tax settlement purposes. This notice must be done within one month before the day the employee leaves Malaysia. However, you do not have to give out notice if the employee is on a regular basis of travel.
2. When is the deadline and who should submit the form?
As of 2024, the deadline for filing Borang E in Malaysia is:
- March 31 for manual filing
- April 30 for electronic filing
All companies must file Borang E regardless of whether they have employees or not. Any dormant or non-performing company must also file LHDN E-Filing. All partnerships and sole proprietorships must now file this form as well.
| Type of Company | Staff | No Staff | Report Borang E |
| Berhad | ✔ | ✔ | ✔ |
| Sdn Bhd | ✔ | ✔ | ✔ |
| Sole-Proprietor A | ✔ | – | ✔ |
| Sole-Proprietor B | – | ✔ | ✔ |
| Partnership A | ✔ | – | ✔ |
| Partnership B | – | ✔ | ✔ |
| Individual | – | – | X |
LHDN no longer accept manual submissions from companies. However, why is there a deadline for manual submission? That is because employers who are not companies have the option to submit Form E either via e-Filing or paper form.
What if a company proceeds with a paper/manual submission of the tax form? In that case, LHDN has the right to not accept the submission under subsection 83(1B) of the Income Tax Act 1967 (ACP 1967).
3. How do I submit Borang E?
Firstly, an employer must register the Employer (“E”) file first. Furthermore, because LHDN no longer accepts manual forms, all PCB calculations have to be done online. Hence, it’ll be good for a company to use an online payroll system that is PCB-compliant and Borang E-ready.
To check whether a payroll software is legitimately PCB-compliant and Borang E-ready, see that it is approved and certified by LHDN. After all, this is the safest way to ascertain that the payroll software you want to use is safely compliant with employment requirements in Malaysia for tax filing purposes like Borang E.
One Borang E-ready software you can consider from the list is Talenox.
Talenox is a self-service HR SaaS that helps thousands of companies avoid penalisations and audits by accurately auto-calculating their salaries and taxes for free. With Talenox Payroll, you can submit Borang E in just 3 steps:
- Head over to Payroll > Payroll Settings > Form E. Click on “Generate Form E for {xxx}”.
- Double-check each employee’s Borang E to ensure that everything is in place.
- Once that is done, click on “Download Form E“, sign and submit via E-Filing.
Too good to be true? Check out our short introductory video to see it for yourself:
Prefer reading over watching? Alternatively, you may also check out our Knowledge Centre article on how easy it is to generate, fill and print Borang E in Talenox.
What do I do after printing out the forms? For next steps, check out our Knowledge Center article guide for step-by-step instructions on how to submit Borang E in the ezHasil portal.
4. What are the specific details to look out for in Borang E?
Basic Information
In this section, the following are required:
- Name of Employer. This name should be as registered with the Companies Commission of Malaysia (SSM) or others.
- If there is any change to the employer’s name, simply indicate the former name in parenthesis.
- What if the employer is not registered with SSM or others? In that case, simply fill in the name as per identity card or passport.
- Employer’s Number. An employer’s file number is required. E.g. E12345678.
- Status of Employer. With reference to the table below, you should indicate the Status Code as ‘4’ if the employer fronts a private company.
- Status of Business. If a company has never commenced operations since the date it was incorporated or established, the status of business is considered ‘Dormant’. A business is also considered ‘Dormat’ if it had previously been in operation or business but has now ceased these activities.
- Income Tax Number. The first two numbers would be the File Type Code, while the subsequent string of 11 numbers are the Income tax Number. You can ascertain each employee’s File Type Code by referring to the table below.
- Identification Number and Passport Number. These details have to be indicated by the precedent partner or sole proprietor of the business, if any.
- Registration Number with SSM or Others. This is the number as registered with the Companies Commission of Malaysia (SSM) or others.
- Correspondence Address, Telephone Number, Handphone Number and Email. These contact details will be used for any correspondence with LHDN, so do ensure that they are correct.
- Return of C.P.8D. This is where you enter the relevant code for the method of submission in the box provided.
Information on the Number of Employees for YA 202X
| Total number of employees as of 31/12/202X | The total number of employees in the employer’s company /business as at 31 December 202X including full-time/part-time/contract employees and interns. |
| Number of employees subject to MTD/PCB | The total number of employees subject to the Monthly Tax Deduction (MTD) scheme during the year 202X. |
| Total number of new employees | The total number of employees who commenced employment in the employer’s company/business during the year 202X. |
| Number of employees who ceased employment | The total number of employees who ceased employment in the year 202X. |
| Total number of employees who ceased employment and left Malaysia | The total number of employees who ceased employment to leave Malaysia (‘foreign leaver’) in the year 202X. |
| Reported to LHDN (if A5 is applicable) | This item has to be completed if item A5 is applicable. Enter ‘1’ (‘Yes’) if the employer has reported the cessation to LHDN. If ‘2’ (‘No’) is entered, immediately contact the LHDN branch in charge of the employee’s income tax file. |
Return of Remuneration from Employment, Claim for Deduction and Particulars of Tax Deduction for YA 202X
| A | No. | The numbering should be in ascending order here. In other words, the first Borang E filled in for an employee should be indicated as “1”. Then, each subsequent Borang E filed for the rest of the employees should be numbered as “2”, “3”, etc. |
| B | Name Of Employee | Enter the full name of the employee as per his or her identity card/passport. |
| C | Income Tax No. | Key in the employee’s income tax number in this item. Example: SG 10234567080 |
| D | Identification / Passport No. | Enter the employee’s Identification (Identity Card / Police / Army) or Passport No. in the box provided. Tip: Try to give priority to New Identity Card No. followed by Police No., Army No. and Passport No. |
| E | Category Of Employee | Indicate the following single-digit code for the relevant employees. 1 = Single Employees 2 = Married and spouse is not employed 3 = Married and spouse is working, divorced or widowed, or single with an adopted child. |
| F | Tax Borne by Employer | Enter ‘1’ (‘Yes’) if the employee receives benefit from tax borne by his employer (tax allowance). Alternatively, you can indicate ‘2’ (‘No’) if the employee does not receive this benefit in the year 202X. |
Qualifying Child Relief
| G | No. Of Children | State the number of children on whom the employee is eligible to claim tax relief for the year 202X. |
| H | Total Relief | State the total child relief taken into account in computing the employee’s last MTD for the Year of Remuneration 202X. |
| I | Total Gross Remuneration | The total gross remuneration of employee chargeable to tax, including: ∼ Benefits in Kind ∼ Value of living accommodation benefit ∼ Overdue gross remuneration from preceding years that were received in 202X. |
| J | Benefits In Kind | Value of benefits in kind received by the employee from the employer. |
| K | Value Of Living Accommodation | Value of living accommodation benefit received by the employee from the employer. |
| L | Employee Share Option Scheme (ESOS) Benefit | Value of benefit from shares received by the employee from the employer. |
M. List of Tax-Exempt Allowances/ Perquisites/Gifts/Benefits
Total Claim for Employee via Form TP1
| N | Relief | Total deduction claimed by the employee for the year 2023. This is the total amount from Part C (Particulars Of Deduction) of Form TP1* (if any) submitted by the employee and processed by his employer. |
| O | Zakat | The total amount claimed by the employee in 202X on zakat. This excludes payment via monthly salary deduction i.e. the total of amounts from Part D (Rebate) of Forms TP1 (if any) submitted by the employee and processed by his employer. |
| P | Contribution To EPF | Total compulsory contribution paid by the employee to the Employees Provident Fund (EPF). |
| Q | Zakat Paid Via Salary Deduction | The total amount of zakat paid by the employee via salary deduction. |
Total Tax Deduction
| R | MTD | The total amount of income tax deducted under the Income Tax Rules (Deduction from Remuneration) 1994, and remitted to LHDN in respect of the employee. The MTD/PCB made for the year 202X in respect of the employee shall include: – Income for 202X; – Employment income for preceding years paid in the year 202X (including bonus, director’s fee, arrears of salary and any other remuneration); and – Employment income received in advance for the relevant year which is paid in 202X. |
| S | CP38 | The total amount of income tax deducted as per Form CP 38 instruction, and paid to LHDN in respect of the employee |
That’s all, folks! We hope this article was useful to you. If you have any questions, feel free to drop us a comment below!
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Sole proprietor without staff need to fill in C.P.8D?
Hi Agnes,
As a sole proprietor without staff, you typically wouldn’t have employees to whom you’re making payments that require declaration on the CP8D form. Therefore, in most cases, sole proprietors without staff wouldn’t need to fill out the CP8D form. However, just to be sure, you should confirm with IRD.
Did LLP without staff need to submit Form E?
Hi Joey,
In Malaysia, Limited Liability Partnerships (LLPs) are required to submit Form E if they have made any payment to individuals (including proprietors, partners, and directors) for the purpose of deduction of tax, regardless of whether they have staff or not.
I have LLP and while filling in Form E, I was required to complete CP8D. I have no employee, except myself and another partner. We do not receive any remuneration from the LLP. However, I am not able to submit the Form E. Does this mean I need to add my name and partner as employee and fill in remuneration as 0? Thanks.
Hi Cho, if you and your partner do not receive any remuneration from the LLP, you should not need to add yourselves as employees with zero remuneration on the CP8D for the purpose of completing Form E. Since there are no employees and no remuneration paid, it is not necessary to report “0” remuneration.
However, it might be a different issue that’s preventing you from submitting Form E. To address this problem, you should first check the submission guidelines provided by LHDN (Lembaga Hasil Dalam Negeri Malaysia), as there may be certain fields that need to be filled out to complete the submission process, even if you are entering zero or non-applicable information.
If after checking all the necessary fields and ensuring compliance with the guidelines of the tax authority you still encounter issues, it would be advisable to reach out directly to LHDN for specific guidance on how to file Form E correctly for your LLP scenario, or consider seeking professional tax advice.
If a person is not an employee of the company, also not under contract but receives a fixed allowance every month. Should i declare? if so in which category 1. part time or others
Hi chua,
If an individual receives a fixed allowance every month from the company but is not an employee or under contract, the payment to that individual may still be subject to tax withholding by the company. In Malaysia, such payments are typically subject to tax under the “Payment to Non-Executive Directors” category.
Even though the individual is not considered an employee, if they receive regular payments from the company, it may be deemed as income subject to taxation. Therefore, the company should still declare these payments on Form E under the appropriate category.
When submitting Form E, if there isn’t a specific category for payments to non-employees or individuals not under contract, you may need to consult with the Inland Revenue Board of Malaysia (IRBM) or a tax professional to determine the most appropriate category for reporting such payments. It is best to consult with them to determine which category your employee would fall under. 🙂
may i k now what is the reason when i upload the trading license for partnership was rejected?
Hi Yee,
Unfortunately we can’t advise you on this as we’re not in the business of licensing, or under the relevant authorities. However, we asked around and found that you may check with Bursa Malaysia on why your trading license was rejected. https://www.bursamalaysia.com/listing/lfx/business_process/licensing/licensing_guidelines
Hi, would like to seek your advise. In malaysia, if for year 2023 an employee’s total annual gross remunation is 100k.
Gross remunation included travelling allowance (fixed amount) / bonus / commission
Employee is entitle to tax excemption of RM6k.
As en employer when submitting cp8d for year 2024. what is the actual amount of total gross remunation need to submit to lhdn? 94k or 100k,
Employer is sdn bhd
Hi Melissa,
The total gross remuneration submitted to LHDN for Form CP8D should not include an employee’s tax exemption. The tax exemptions are amounts that the employee will not be taxed on and should be declared separately on the form, in accordance with LHDN’s guidelines.
Hi, Freelancer need to declare in Form CP8D?
Hi David,
No, freelancers or self-employed individuals in Malaysia do not need to file Form CP8D. This form is only for employers to declare the remuneration paid to their employees. Freelancers and self-employed individuals should use the appropriate forms for their type of business income, such as Form B for sole proprietors or Form BE for those without business income. However, please kindly check with LHDN or tax consultants as they would be able to provide you with the most appropriate answer.