For Malaysian filers
LHDN fines 2026: every tax penalty, in actual ringgit.
Filing late costs RM 200 to RM 20,000 under Section 112. Paying late adds a 10% surcharge, then another 5%. Over-claiming reliefs can cost a 200% special penalty. Here is the full list of LHDN income tax penalties under the Income Tax Act 1967, verified against LHDN's official Offences page, with what each one actually means in plain English.
| Offence | Law | Penalty |
|---|---|---|
| Filing late or not at all | Section 112 | RM200–RM20,000 + up to 300% of tax |
| Late payment of tax owed | Section 103 | 10% surcharge, +5% after 60 days |
| Incorrect return | Section 113 | RM1,000–RM10,000 + 200% of shortfall |
| Wilful tax evasion | Section 114 | RM1,000–RM20,000 + 3× tax evaded |
| Failing to keep records | Section 119A | RM300–RM10,000 |
| Missing the e-Invoice rules (sole-prop / freelance) | ITA 2024 amdts. | RM200–RM20,000 per transaction |
- 01
Filing late or not at all
Section 112Penalty
Fine of RM 200 to RM 20,000, jail up to 6 months, or both — plus 300% of the tax owed if LHDN raises a best-judgment assessment.
Why people get caught
Form BE deadline is 30 April (paper) or 15 May (e-filing). Form B is 30 June or 15 July. People miss it because life gets busy, they think "no income, no need to file", or they assume their employer's PCB covers everything (it usually doesn't if you have side income or unclaimed reliefs).
How MyTaxMate prevents it
MyTaxMate counts down to your filing deadline on every screen and sends a reminder 14 days out. Form BE / B is ready before the deadline so you never file late.
- 02
Late payment of tax owed
Section 103Penalty
10% surcharge on the unpaid balance immediately after the deadline. Another 5% if still unpaid 60 days later.
Why people get caught
You filed on time but didn't pay the balance. Common when people are surprised by a higher-than-expected bill (e.g. side income they forgot to budget for, or under-claiming reliefs the year before).
How MyTaxMate prevents it
Knowing your tax bill weeks early lets you plan cashflow. MyTaxMate computes your liability the moment you log income and reliefs — no surprises in May.
- 03
Incorrect return — over-claimed reliefs or under-declared income
Section 113Penalty
Fine of RM 1,000 to RM 10,000 plus a 200% special penalty equal to the under-paid tax. Audits can claw back up to 7 years.
Why people get caught
Easy to do by accident: claiming the same expense under two different relief categories (medical AND insurance, for example), claiming a relief you don't qualify for (lifestyle for someone else's purchase), or forgetting to declare freelance / e-hailing income that hit your bank account.
How MyTaxMate prevents it
Smart Scan picks the right relief category for each receipt, flags duplicate claims, and routes income from PR gifts / freelance gigs into the correct Form B section. The 7-year retention keeps audit-ready proof for every claim.
- 04
Wilful tax evasion
Section 114Penalty
Fine of RM 1,000 to RM 20,000, jail up to 3 years, or both — PLUS triple the tax evaded. Aiding someone else to evade carries the same penalty.
Why people get caught
Deliberate omission of income, fake receipts, or shell-company tricks. LHDN's data-sharing with banks, MyEG, and platform companies (Grab, Foodpanda) makes this much harder to get away with than people realise.
How MyTaxMate prevents it
MyTaxMate is built for the opposite use case: claim every legitimate relief you qualify for, declare every ringgit honestly. The cleanest filing is also the cheapest one.
- 05
Failing to keep records
Section 119APenalty
Fine of RM 300 to RM 10,000, or jail up to 1 year, or both.
Why people get caught
LHDN requires you to keep your supporting documents — receipts, invoices, EA forms — for 7 years. People bin them in February. If LHDN audits 4 years later, you can't substantiate the reliefs you claimed.
How MyTaxMate prevents it
Every receipt you snap is stored encrypted in Malaysian-region cloud storage for 7 years. Pulling proof for an audit is one search away.
- 06
Missing the e-Invoice rules (sole-prop / freelance)
Income Tax Act 2024 amendmentsPenalty
RM 200 to RM 20,000 per non-compliant transaction; from January 2026, individuals making transactions over RM 10,000 must obtain a valid e-Invoice from the seller.
Why people get caught
Phased e-Invoicing has rolled out across 2024-2026. Sole-props and freelancers under the income threshold often miss it because the rule was written for businesses, not them.
How MyTaxMate prevents it
MyTaxMate's Smart Scan flags receipts over RM 10,000 and prompts you to attach the e-Invoice instead of just the photo.
Frequently asked questions
How much is the LHDN penalty for late tax filing?
Under Section 112 of the Income Tax Act 1967, filing late carries a fine of RM 200 to RM 20,000, up to 6 months' jail, or both. If LHDN raises a best-judgment assessment because you didn't file, they can add a penalty of up to 300% of the tax owed.
What is the penalty for late payment of income tax in Malaysia?
Under Section 103, an unpaid balance after the deadline is hit with a 10% surcharge immediately, then a further 5% if it's still unpaid 60 days later.
Can LHDN fine you for the wrong reliefs or under-declared income?
Yes. Under Section 113, an incorrect return can draw a fine of RM 1,000 to RM 10,000 plus a special penalty of up to 200% of the under-paid tax, and LHDN can audit up to 7 years back.
How long must I keep my receipts for LHDN?
Seven years. Failing to keep records is itself an offence under Section 119A (fine of RM 300 to RM 10,000, or up to 1 year's jail). MyTaxMate stores every scanned receipt for the full 7-year window.
Sources
You don't need to memorise this list. MyTaxMate enforces every rule on this page automatically — every receipt, every relief, every deadline.
See how it works