Late Tax Filing Penalty for Online Sellers in Malaysia

Late payment. LHDN's page on late payment penalties for individuals says that tax unpaid after the due date (30 June for business individuals, or 15 July for the e-Filing grace period) attracts a 10% penalty on the balance. Companies are subject to similar penalties under section 103 of the Act, and the rate can increase if the balance stays unpaid for further periods.

Late filing. If an e-B is filed after the grace period ends, LHDN's filing programme says the return is treated as late from the original due date and a penalty is imposed. Failing to furnish a return is an offence under section 112 of the Income Tax Act, and LHDN also has power to raise an assessment on its own estimate.

Missing records. If records cannot be produced, LHDN can estimate income, and the seller may find it hard to prove expenses.

Practical tips (year of assessment 2025)

1. File even if no tax is due.
2. Pay the balance by the return due date.
3. Where a mistake is found later, ask LHDN about amending the return and about its voluntary disclosure programmes.

The 10% penalty is the figure LHDN states for individuals; further penalty rates for unpaid balances are set by the Act.