Penalties and appeals: late filing, wrong information, additional assessments (YA 2026)

Three different things — don't confuse them

Term	What it is	Example
Increase	Additional amount imposed on tax paid late	10% on unpaid tax balance after the due date
Offence fine	Punishment for an offence under the Act (e.g. late/non-filing)	RM200–RM20,000 / imprisonment (according to the provision)
Administrative penalty	Special claim by the Director General without prosecution	treble penalty in certain cases

Source: HASiL — Offences, Fines and Penalties; Income Tax Act 1967.

A. Offences and fines (official HASiL schedule)

All fine amounts are statutory ranges (minimum–maximum); the court determines the actual sentence.

Offence	Provision	Fine/Penalty (official range)
Failing to submit BNCP / failing to notify chargeability to tax	112(1)	RM200–RM20,000 / imprisonment ≤ 6 months / both
Failing to report actual income in BNCP	113(1)(a)	RM1,000–RM10,000 AND 200% of the under-reported tax
Giving inaccurate information regarding tax liability	113(1)(b)	RM1,000–RM10,000 AND 200% of the under-reported tax
Wilfully evading tax	114(1)	RM1,000–RM20,000 / imprisonment ≤ 3 years / both AND 300% of the under-reported tax
Aiding/advising in the preparation of BNCP causing underpayment of tax	114(1A)	RM2,000–RM20,000 / imprisonment ≤ 3 years / both
Leaving the country without paying tax	115(1)	RM200–RM20,000 / imprisonment ≤ 6 months / both
Obstructing/hindering a HASiL officer	116	RM1,000–RM10,000 / imprisonment ≤ 1 year / both
Failing to keep records	119A	RM300–RM10,000 / imprisonment ≤ 1 year / both
Failing to give information required by HASiL	120(1)	RM200–RM20,000 / imprisonment ≤ 6 months / both

Source: HASiL — Offences, Fines and Penalties (official schedule); Income Tax Act 1967 (Act text).

Additional from the Act text:

• s112(1A) — late filing of 2+ years: fine RM1,000–RM20,000 / imprisonment ≤ 6 months / both + special treble penalty of the amount determined by the Director General.
• s112(3) — if there is no prosecution, the Director General may claim a treble penalty of the tax payable.

B. Late-payment increase on tax (10%)

• Tax balance not paid after the due date (30 April/15 May for employment cases; 30 June/15 July for business/other-income cases) is subject to a 10% increase — s103(3).
• Tax payable under certain assessments not paid within 30 days after the notice is served — 10% increase — s103(5); failure of an allowed instalment — 10% on the balance (s103(7)).
• The Director General may remit the whole/part of the increase for good cause — s103(9).
• Important note: subsections 103(4) and (6) have been repealed (deleted by Act 823) in the consolidated text — there is no second-stage 5% increase in the current text.

Source: HASiL — Late Payment Increase of Tax; Income Tax Act 1967 (s103).

C. CP500 instalment penalty (10%)

• Paying an instalment after 30 days from the due date — 10% on the overdue instalment — s107B(3).
• Actual tax 30% higher than the revised estimate — 10% on the difference between the actual tax balance and the estimate — s107B(4).
• The 2026 CP500 penalty concession (salaried individuals) applies only to the year 2026 — do not extend it to 2027 without confirmation.

Source: HASiL — Offences, Fines and Penalties; Form CP502 (official PDF); Income Tax Act 1967 (s107B).

D. Appeals against assessments

• Form Q — appeal within 30 days from the date of the assessment notice (s99(1)); submitted to the HASiL branch handling the file.
• Form N — application for an extension of the appeal period (s100): written application within 7 years after the expiry of the original period; the Director General's decision is final.
• The Director General reviews the appeal within 12 months (s101) — extendable by the Minister by up to 6 additional months.
• If there is no agreement, the appeal is referred to the Special Commissioners of Income Tax (PKCP) (s102) — the current statutory appeal body (not a court of first instance); a further appeal lies to the High Court.
• Dispute Resolution Proceedings (PRP) are available as a dispute resolution mechanism before PKCP.

Source: HASiL — Appeals (Individuals); Income Tax Act 1967 (s99–102); Public Ruling No. 7/2020 (Appeals against an Assessment and Applications for Relief).

E. Voluntary amendments (correcting forms)

• Amended Return Form (BNT) can be submitted within 6 months from the deadline for submitting the Return Form; only once; only for those who filed within the prescribed period.
• e-Amendment Application for BE can be accessed from 1 April every year (limited cases: over-reporting of income; under-claiming of reliefs/rebates).

Source: HASiL — Amendment of Assessment (BNT).

Simple example

Maya missed the e-BE filing deadline. She receives an assessment notice from HASiL together with an offence fine (statutory range). The tax balance not paid after the due date is also subject to a 10% increase. Maya disagrees with the assessment — she submits Form Q within 30 days, then applies for an extension via Form N. (Illustrative example — not specific tax advice; the fine amount is determined by the court.)

Frequently Asked Questions (FAQ)

Q. If I miss the deadline, how much do I need to pay? A. It depends on the type of offence and whether the tax has been paid. Refer to the offence schedule above; all amounts are statutory ranges — the court determines the actual sentence. This item still awaits official confirmation from HASiL — check again with HASiL before deciding. for example calculations.

Q. Can I appeal without paying first? A. For the late-payment increase, the official HASiL rule states that payment must be made first even if an appeal is submitted.

Q. What is the difference between s112(1) and s112(1A)? A. s112(1) is the late/non-filing offence (RM200–RM20,000); s112(1A) is the late-filing case of 2+ years with a fine of RM1,000–RM20,000 + a special treble penalty.

Q. How long do I have to appeal? A. Form Q: 30 days from the date of the assessment notice. Extension: via Form N.

Q. I filled in the form wrongly — can I correct it? A. Yes, via BNT within 6 months from the filing deadline (once only), or e-Amendment Application for BE from 1 April for limited cases.

Glossary

• BNCP — Income Tax Return Form.
• BNT — Amended Return Form.
• PKCP — Special Commissioners of Income Tax.
• PRP — Dispute Resolution Proceedings.
• Treble penalty — a penalty of three times.
• Remit — waive (the increase) by the Director General.