IRB’s Special Voluntary Declaration Programme extended to June 30

KUALA LUMPUR: The government has instructed the Inland Revenue Board (IRB) to extend by three months the first phase of the Special Voluntary Declaration Programme (SVDP) to June following encouraging feedback from taxpayers.

SDVP, announced in the 2019 Budget, is part of the government’s tax reforms to encourage taxpayers to voluntarily declare their income and subsequently reduce leakage of government revenue.

It is focused on taxpayers who have overseas accounts and taxable income in Malaysia, but have yet to report to IRB.

Yesterday, Finance Minister Lim Guan Eng said IRB had received 381,979 voluntary tax declarations up to March 31.

He said the cabinet had decided to extend the first phase of SVDP, of which the penalty rate is 10 per cent on the amount of tax payable, to June 30.

“The government hopes with this extension, more taxpayers will participate in SVDP to ensure they enjoy the low penalty rates and subsequently reduce their tax burden.”

This means SVDP’s second phase, of which the penalty rate is 15 per cent on the amount of tax payable, will be shifted to the three months from July 1 to Sept 30.

This means effective Oct 1, IRB will revert to imposing penalty rates of between 80 per cent and the maximum of 300 per cent.

Lim said SDVP allowed for individual taxpayers to make voluntary declarations of unpaid taxes for the years up to 2017. As for corporates, SDVP was applicable for financial years up to March last year.

Lim said under SDVP, IRB would receive every declaration with an open heart and would not audit or conduct investigations.