How long must a Malaysian company keep its accounting and tax records?
Seven years. LHDN tells employers to keep records for seven years and to make them easy to retrieve. Failing to keep proper records without reasonable excuse is an offence, with a fine of RM300 to RM10,000, up to a year in prison, or both under s.119A.
Record keeping is a legal duty, not just good practice.
Period: seven years. Section 82 requires business records to be kept for seven years from the end of the year to which they relate, and s.82A requires the documents behind a return to be kept for seven years from the end of the year of assessment. LHDN's employer guidance repeats the seven years and adds that records must be accessible when LHDN asks.
Penalty: LHDN's table lists failure, without reasonable excuse, to comply with an order to keep proper records as an offence under s.119A, punishable by a fine of RM300 to RM10,000, imprisonment of up to one year, or both.
What to keep:
- Invoices, receipts, bank statements, contracts and payroll records
- General ledger, financial statements and tax computations
- Capital asset registers and loan agreements
- Withholding tax forms and proof of payment
- Records supporting any deduction or relief you claim
Format: electronic records are acceptable if they are complete, readable and can be produced on request.
Closing down: the duty does not end when the company stops trading. Make arrangements for the records to be stored for the remaining period.
Note that the assessment time limit is five years, so records for the last seven years cover it.
Legal basis
- Income Tax Act 1967, s.82
- Income Tax Act 1967, s.82A
- Income Tax Act 1967, s.119A
Sources
Applies to YA 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- How long can a Malaysian company carry forward its tax losses?Unused business losses can be carried forward for up to 10 consecutive years of assessment, against income from the same business. They cannot be carried back. A dormant company loses its losses if more than half of its shareholders change.
- What is the corporate tax rate for a small company in Malaysia?A Malaysian resident company normally pays 24% income tax. A company that meets the SME conditions pays 15% on the first RM150,000 of chargeable income, 17% on the next RM450,000 (up to RM600,000), and 24% on anything above that.
- What conditions must my company meet to get the SME tax rates in Malaysia?To use the lower 15%/17% rates, the company must be resident, have ordinary paid-up capital of RM2.5 million or less, and gross business income of RM50 million or less. It must also pass the related-company test and, from YA 2024, a foreign-ownership test.
- Does a dormant company with no income still have to file a tax return in Malaysia?Yes. LHDN says companies that are dormant or have not started business must still register a tax file and file returns. A nil return tells LHDN there is no taxable income, and failing to file can be an offence even when no tax is due.
- What is the Year of Assessment and how does it relate to my financial year?The Year of Assessment (YA) is the calendar year in which your company's accounting year (the basis period) ends. A company with a financial year ending 30 June 2025 reports that income in YA 2025.