Every year from March to July is the tax filing season. Migrant employees need to complete the BE tax return before April 30, while businessmen need to complete the B or P tax return before June 30.
Migrant employees will receive employment and salary statements from employers during this period, which is commonly known as the EA form. This EA form will clearly show the income, benefits, withholding funds, provident funds, etc., that the migrant employees received in the past year. Migrant employees can report their income tax according to the EA form given by the employer, referred to as a tax return.
Since the government has stipulated the format of the EA form, the format of the EA form given by each company is the same, the only difference is the salary and other items of the migrant employees.
Generally speaking, the EA form is divided into 7 sections from A to F.
- A is an employee’s data
- B and C are collectible income
- D is the total deduction
- E is the provident fund and social insurance contributions
- F is the deferred payment and other details
EA Form
Section A: Employee Information
The employer will fill in the employee information in this section, including name, position, employee number, ID card number, employee provident fund number, etc. If the employee has been employed for less than one year, such as joining or leaving in the middle of the last year, the date of joining and leaving will be displayed.
Section B: Employment Income, Benefits, and Accommodation
(Excludes tax-free allowances/extra cash rewards (Perquisites)/gifts/benefits)
This income part is divided into 6 classes. If the salary package is relatively simple and the employer does not provide material benefits such as a car or accommodation, usually only 6 classes of income in the past year are specified in 1 class.
If material benefits are included in the pay package, the employer must calculate its value according to the tax office’s formula. If employees do not understand the amount, they should check with their employer.
According to Section 13(1b) of the Income Tax Act, material benefits or facilities provided by a company cannot be converted into money, these are benefits provided or paid by the employer for the enjoyment of employees, spouses, family members, etc.
1. Salary, wages, or paid leave (including overtime allowance)
– Fees (including director fees), commissions, or bonuses
– Total tips, additional cash awards, bonuses or gratuities, or other perks
– Income tax absorbed by the employer on behalf of the employee
2. Deferred payments and other payment details for previous years
3. Material welfare value (physical value):
(a) Car (must include details of car model, date provided by the company, the value of car and gasoline, driver)
(b) Utility bills, telephone bills, and other benefits
(c) Household benefits (relevant furniture, air conditioners, curtains, carpets, kitchen utensils, etc. should be specified)
(d) Domestic helpers and gardeners
(e) Travel and vacation benefits
(f) other (such as food and clothing)
4. Value of accommodation benefits (address required)
5. Unapproved pension, plan, or society refunds
6. Unemployment Compensation
Section C: Pensions and Others
In addition to the employee’s pension, this column may also indicate annuities or other periodic payments.
Section D: Total Deductions
1. Monthly withholding tax paid to the IRS this year
2. CP 38 deductions (i.e. the tax deparment issues a “wage deduction order” to the taxpayer’s employer who owes tax arrears, requesting that the unpaid income tax be deducted directly from the salary of the employee concerned; the total amount deducted will be displayed here.)
3. Islamic Aid (Zakat)
4. Approved donations or gifts
5. Amount of relief claimed by the employee through TP 1 form
6. Eligible Child Relief
Section E: Total Contributions to Approved Pensions or Provident Funds, Funds or Societies
This column will indicate the name of the relevant provident fund, usually the employee provident fund; and the total amount paid by the employee. The employer section does not have to be noted here, and the amount of social insurance paid.
Section F: Payment in arrears and other payment details for previous years
According to the Inland Revenue Department Malaysia, if an employee fails to receive employment income in the current year, and the payment is received in the tax year for which the tax is filed, the amount must be noted in this column. For example, a salary that was supposed to be received in 2020 and received in 2021 should be noted on the EA form for the 2021 tax year.
