Business Income Tax Return — Borang B / C (Malaysia)
BUSINESS INCOME TAX RETURN — SUMMARY WORKSHEET
Income Tax Act 1967 (Act 53) | Lembaga Hasil Dalam Negeri Malaysia (LHDN)
Year of Assessment: [Assessment Year]
Form type: [Entity Type]
Financial year end: [Financial Year End]
PART A — ENTITY DETAILS
Business / company name: [Entity Name]
SSM / registration number: [Registration Number]
Income tax file number: [Income Tax File No]
Business address: [Business Address]
PART B — INCOME AND EXPENSE SUMMARY
Gross revenue / turnover: [Gross Revenue]
Cost of sales: [Cost of Sales]
Gross profit: [Gross Profit]
Allowable business expenses: [Allowable Expenses]
Capital allowances (Schedule 3 ITA 1967): [Capital Allowances]
Adjusted business income: [Adjusted Business Income]
Unabsorbed losses brought forward: [Accumulated Losses]
PART C — TAX COMPUTATION
Chargeable income: [Chargeable Income]
Applicable tax rate: [Tax Rate]
Tax payable (before instalments): [Tax Payable]
CP204 / CP500 instalments paid: [CP204 Instalments]
Balance tax payable / (refund): [Balance Tax Payable]
Audited accounts available: [Audited Accounts]
KEY LHDN DEADLINES — BUSINESS TAXPAYERS
Form C (companies): 7 months from financial year end (e.g. 31 July 2025 for FYE 31 Dec 2024)
Form B (sole proprietor): 30 June of following year (e-Filing: 15 July with extension)
Form P (partnership): 30 June of following year
CP204 (company instalment scheme): submit estimate by 3rd month of new financial year
CP204A (revision of estimate): revise in the 6th and/or 9th month of the financial year
Balance tax payment: due by filing deadline — late payment attracts 10% penalty under Section 103 ITA 1967
File online at: mytax.hasil.gov.my | Enquiries: 1-800-88-5436 (HASIL Care Line)
Director / Authorised Officer / Sole Proprietor
________________
Signature
Tax Agent (if applicable)
________________
Signature
What Is a Business Income Tax Return — Borang B / C (Malaysia)?
A Business Income Tax Return — Borang B / C in Malaysia sets out the income, deductions, and tax position to be reported to the authority.
For companies, the income tax rate under Schedule 1, Part I of the Income Tax Act 1967 is 24% on chargeable income for the year of assessment 2023. Small and medium enterprises (SMEs) qualifying as Syarikat Harta Intelek Malaysia under LHDN's definition — with paid-up capital not exceeding RM 2.5 million — pay a reduced rate of 15% on the first RM 150,000 of chargeable income and 24% on the balance. This reduced rate incentive was introduced under the Finance Act 2023 to support SME growth. Companies must use the e-Filing system for Borang C under the Income Tax (Electronic Filing) Rules 2006 through the LHDN MyTax portal at mytax.hasil.gov.my.
The self-assessment system (SAS) for companies in Malaysia requires companies to estimate their own income tax payable and remit it in 12 equal monthly instalments (CP204 instalment scheme) commencing from the second month of the company's basis period, with the first instalment due on the 15th of the relevant month under Section 107C of the Income Tax Act 1967. The final tax return (Borang C) must be filed within 7 months after the close of the company's accounting period, and any balance tax (additional assessment) or refund is settled at that stage.
Capital allowances under Schedule 3 of the Income Tax Act 1967 allow businesses to deduct the cost of qualifying plant and machinery, industrial buildings, and other capital assets over their prescribed working lives. Initial allowances (20% of cost) and annual allowances (at prescribed rates, typically 10% to 20% for plant and equipment) replace accounting depreciation as the tax-deductible capital cost deduction. Accelerated capital allowances under various Promotion of Investments Act 1986 (Act 327) incentives are available to companies in promoted sectors including manufacturing, biotechnology, ICT, and green technology.
The legal framework governing the Business Income Tax Return — Borang B / C (Malaysia) in Malaysia draws on several key statutes and regulatory bodies. Under Malaysian law, the Contracts Act 1950 (Act 136) governs contractual obligations. The Companies Act 2016 (Act 777) regulates corporate entities through the Companies Commission of Malaysia (SSM). The Employment Act 1955 (Act 265) and the Department of Labour govern employment matters. The Personal Data Protection Act 2010 (Act 709) and the Personal Data Protection Department protect personal data. The Inland Revenue Board of Malaysia (LHDN) administers tax obligations. The Industrial Court adjudicates employment disputes under the Industrial Relations Act 1967 (Act 177). Parties executing a Business Income Tax Return — Borang B / C (Malaysia) in Malaysia should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Income Tax Act 1967 (Act 53) sets the foundational requirements.
When Do You Need a Business Income Tax Return — Borang B / C (Malaysia)?
A Malaysia Business Income Tax Return (Borang B for individuals, Borang C for companies) is required to be filed by every person or company carrying on a business in Malaysia and liable to income tax.
Borang B is needed when a sole proprietor registered under the Registration of Businesses Act 1956 (Act 197) with SSM derives business income from trading, professional services, or any other business source under Section 4(a) of the Income Tax Act 1967. All sole proprietors with business income above the chargeable income threshold must file Borang B.
Borang C is required when a company incorporated under the Companies Act 2016 and registered with SSM carries on a business in Malaysia and derives chargeable income. All companies in Malaysia — including Sdn Bhd, Bhd, and foreign company branches — must file Borang C annually regardless of whether any income tax is payable, as long as the company is in operation.
Borang B is needed when a professional — such as a lawyer, doctor, architect, engineer, or accountant in private practice — derives professional income under Section 4(a) or Section 4(b) of the Income Tax Act 1967 and is assessed as a business under the Income Tax Act.
Borang C is required when a company receives income from a foreign source — dividends, interest, royalties, or gains from overseas investments — that is remitted to Malaysia. Under Section 3A of the Income Tax Act 1967, foreign-sourced income remitted to Malaysia by a resident individual or company is taxable in Malaysia with effect from 1 January 2022, with limited exemptions under the Income Tax (Exemption) (No. 5) Order 2022.
Borang B is needed when a partner in a Malaysian registered partnership derives their share of partnership income under Section 4(a) of the Income Tax Act 1967 as assessed under the partnership's Borang P return. Each partner reports their individual share of partnership profit in their personal Borang B.
What to Include in Your Business Income Tax Return — Borang B / C (Malaysia)
A complete Malaysia Business Income Tax Return (Borang B / Borang C) must cover the following essential components.
Taxpayer identification: For individuals (Borang B) — full legal name, income tax reference number (beginning with B for individuals with business income), MyKad number, and year of assessment. For companies (Borang C) — company name, company registration number (SSM), income tax reference number (beginning with C), and the basis period (financial year end) for the year of assessment.
Financial statements: Summary of the audited or unaudited financial statements — gross income, cost of sales, gross profit, operating expenses, and net profit or loss from the profit and loss account prepared under the Malaysian Financial Reporting Standards (MFRS) or the Malaysian Private Entities Reporting Standard (MPERS). For companies, the accounts must be audited by an approved company auditor under Section 267 of the Companies Act 2016 before the tax return is filed.
Business income computation: Adjustments to accounting profit to arrive at statutory income (adjusted income) under the Income Tax Act 1967 — including adding back non-deductible expenses under Section 39 of the Act (such as non-business entertainment, penalties, and private expenditure) and deducting capital allowances claimed under Schedule 3 of the Act.
Capital allowances schedule: Claims for initial allowance (IA) and annual allowance (AA) on qualifying capital expenditure incurred on plant and machinery, industrial buildings, and other qualifying assets. The prescribed rates under Schedule 3 of the Income Tax Act 1967 must be applied correctly — typical annual allowance rates are 10% for plant and equipment (10-year life) and 3% for industrial buildings (33-year life).
Pioneer status and incentives: Claims for tax exemptions or investment allowances under the Promotion of Investments Act 1986, approved by MIDA (Malaysian Investment Development Authority) or under specific Budget incentives. Pioneer status companies are exempt from income tax on statutory income for 5 to 10 years under Section 25 of the Promotion of Investments Act 1986.
Instalment payments (CP204): Record of monthly instalment payments already made under Section 107C of the Income Tax Act 1967. For companies, the CP204 instalment scheme requires companies to estimate annual tax payable and pay in 12 equal monthly instalments, with the first payment due in the 2nd month of the basis period. Any shortfall between the estimated and actual tax is paid at filing, and excess is refunded by LHDN.
Declaration and filing: The taxpayer's or company director's declaration that the return is correct and complete, with signature and date. Borang C must be e-filed through the LHDN MyTax portal. The filing deadline for Borang C is 7 months after the company's financial year end.
Additional compliance elements for a Business Income Tax Return — Borang B / C (Malaysia) used in Malaysia include: Under Malaysian law, the Contracts Act 1950 (Act 136) governs contractual obligations. The Companies Act 2016 (Act 777) regulates corporate entities through the Companies Commission of Malaysia (SSM). The Employment Act 1955 (Act 265) and the Department of Labour govern employment matters. The Personal Data Protection Act 2010 (Act 709) and the Personal Data Protection Department protect personal data. The Inland Revenue Board of Malaysia (LHDN) administers tax obligations. The Industrial Court adjudicates employment disputes under the Industrial Relations Act 1967 (Act 177). Forms-legal.com provides this template as a starting point for Malaysia-compliant documentation.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Business Income Tax Return — Borang B / C (Malaysia) (Malaysia) [Legal document template]. Forms Legal. https://forms-legal.com/malaysia/government/tax-forms/income-tax-return-business-malaysia
"Business Income Tax Return — Borang B / C (Malaysia) (Malaysia)." Forms Legal, 2026, https://forms-legal.com/malaysia/government/tax-forms/income-tax-return-business-malaysia.
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author = {{Forms Legal}},
title = {Business Income Tax Return — Borang B / C (Malaysia) (Malaysia)},
year = {2026},
howpublished = {\url{https://forms-legal.com/malaysia/government/tax-forms/income-tax-return-business-malaysia}},
note = {Free legal document template. Based on Income Tax Act 1967 (Act 53)}
}Frequently Asked Questions
The corporate income tax rate in Malaysia for the year of assessment 2023 is 24% on all chargeable income under Schedule 1, Part I of the Income Tax Act 1967 (Act 53) for companies with paid-up ordinary share capital above RM 2.5 million. For small and medium enterprises (SMEs) with paid-up capital of RM 2.5 million or less and annual gross business income not exceeding RM 50 million, the reduced rate of 15% applies to the first RM 150,000 of chargeable income and 24% on the balance — a concession introduced under the Finance Act 2023 effective from year of assessment 2023. Petroleum companies conducting upstream petroleum operations under production sharing contracts with Petronas are subject to the separate Petroleum Income Tax Act 1967 at different rates. Foreign companies operating branches in Malaysia pay the same 24% corporate tax rate on Malaysia-sourced income. Tax incentives under the Promotion of Investments Act 1986 administered by MIDA may provide full or partial tax exemptions for qualifying investments in promoted sectors.
A company in Malaysia must file its annual income tax return (Borang C) with LHDN within 7 months after the close of its accounting period (financial year end) under Section 77A of the Income Tax Act 1967. For a company with a financial year ending 31 December 2023, the Borang C filing deadline is 31 July 2024. For a company with a financial year ending 31 March 2023, the deadline is 31 October 2023. Borang C must be submitted electronically through the LHDN MyTax portal under the Income Tax (Electronic Filing) Rules 2006 — manual submission is not permitted for companies. Companies must also file an estimated tax payable (CP204) at least 30 days before the start of each basis period and make monthly instalment payments under Section 107C of the Income Tax Act 1967. Late filing of Borang C without reasonable excuse is an offence under Section 112 of the Act, attracting a fine of RM 200 to RM 20,000 and/or imprisonment.
A business in Malaysia may deduct expenses that are wholly and exclusively incurred in the production of business income under Section 33 of the Income Tax Act 1967. Deductible expenses include: employee salaries, wages, EPF contributions (employer's share), SOCSO contributions, and EIS contributions; business premises rent and utilities; business insurance premiums; advertising and marketing costs; professional fees (accountants, lawyers, consultants); repairs and maintenance of business assets (but not capital improvements); motor vehicle expenses for business use (subject to Section 39 restrictions on private cars); business travel and accommodation; approved training expenses eligible for double deduction under Section 34A of the Income Tax Act 1967; and bank charges and financing costs for business borrowings. Expenses not deductible under Section 39 of the Act include: domestic or private expenditure; penalties and fines; non-business entertainment above prescribed limits; and depreciation (replaced by capital allowances under Schedule 3 of the Income Tax Act 1967).
CP204 is the estimated tax instalment payment scheme for companies in Malaysia under Section 107C of the Income Tax Act 1967. A company must submit its annual tax estimate (CP204 form) to LHDN at least 30 days before the commencement of each basis period (financial year), estimating the income tax payable for that year. The estimated tax is then divided into 12 equal monthly instalments, payable by the 15th of each month starting from the 2nd month of the basis period. For example, a company with a January to December financial year must submit its CP204 estimate by 30 November of the preceding year, with the first instalment due on 15 February. LHDN requires the CP204 estimate to be at least 85% of the actual tax chargeable for the year — companies that underestimate by more than 30% (for certain SMEs) or underestimate without penalty protection may face a 10% penalty on the shortfall under Section 107C(10) of the Income Tax Act 1967. Any excess instalments paid are refunded upon filing of the final Borang C.
All companies incorporated under the Companies Act 2016 in Malaysia — including Sdn Bhd and Bhd companies — are required to have their financial statements audited by an approved company auditor under Section 267 of the Companies Act 2016 for each financial year. The audited financial statements form the basis for the Borang C income tax return submission. Under Section 82 of the Income Tax Act 1967, a company must keep adequate records for 7 years to support the income and expenses reported in the tax return. LHDN may audit the company's tax affairs within 5 years of the year of assessment under Section 91(3) of the Income Tax Act 1967 (extendable to 7 years for fraud cases). Sole proprietors filing Borang B are not required to have their accounts formally audited but must keep business records and can be required to produce them during an LHDN field audit. Approved auditors in Malaysia must be members of the Malaysian Institute of Accountants (MIA) and hold an audit practising certificate.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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