CP500 Income Tax Installment

Form CP500 for Year of Assessment 2012 (YA2012) has been sent out to taxpayers recently by Inland Revenue Board (IRB) in February 2012.

CP500 is

• a "Notis Bayaran Ansuran" which means "Prepayment of Income Tax by Instalment".
• issued under subsection 107B(1) Income Tax Act 1967
• for taxpayer who have other than Employment Income (for salary, you have already pay tax by PCB, unless salary is low)

Please take note that, penalty applies if

1. Forgot to serve installment on time
2. Didn't revise the estimate (using Form CP502) and actual tax payable is higher than estimate by the formula (CS-AC)-(30% x CS)

CS - Cukai Sebenar
AC - Anggaran Cukai dipinda

How to do revision?

1. Must estimate reasonable accurate your final tax at least 7 months in advance before end of the year. Example for YA2012 (1.1.2012 to 31.12.2012), you must estimate total tax payable by June 2012.
2. Must fill up Form CP502 (attached together with CP500 when IRB post to you)
3. Must furnish the CP502 to IRB before 30.6.2012 (in respect of YA2012)

I sincerely believe most taxpayers are not well educated or too busy to bother the tax compliance and administration matter. For those having extra income, you either learn hard or pay someone to help you because the duty and compliance obligation fall on your shoulders. One mistake can be a costly "penalty".

More news on CP500
http://thestar.com.my/news/story.asp?file=/2010/2/23/nation/5725951&sec=nation