Issues with schedular tax deductions

UNLIKE citizens of super rich nations who do not have to pay income tax, contribution to the country’s coffer by individuals with an income is mandatory in Malaysia. The tax due is, of course, subject to the earning capacity of the individual.

Over the years, the Inland Revenue Board of Malaysia or Lembaga Hasil Dalam Negeri Malaysia (LHDN) had introduced measures to facilitate easier annual filing through e-filing and collection through the Schedular Tax Deduction mechanism or Potongan Cukai Berjadual (PCB) from the individual’s salary. This is a move based on honesty and trust and has worked well for the system to be continued.