Public Ruling No.4/2022: Recovery from Person Leaving Malaysia

March 5, 2023

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Public Ruling No. 4/2022: Recovery from Person Leaving Malaysia

The objective of Public Ruling No. 4/2022 – Recovery from Person Leaving Malaysia is to explain the circumstances and procedures for recovering taxes and debts due from taxpayers who will be leaving Malaysia.

Director General (DG) of Inland Revenue Board Malaysia (IRBM) may issue a travel restriction certificate to a Commissioner of Police or a Director of Immigration requesting to prevent taxpayers from leaving Malaysia unless all his taxes and debts are paid.

Such certificate that invokes a stoppage order contains details of the tax, sums, and debts so payable. The action will be taken by a Commissioner of Police or a Director of Immigration upon receiving a such certificate, including the use of such reasonable force and the seizure, removal, or retention of any certificate of identity and any passport, exit permit, or other travel document relating to that taxpayer in order to enforce the request of DG. The DG does not have to prove that a taxpayer intends to leave the country permanently.

Effective from 1 January 2021, the DG can issue a such certificate to the Malaysian Immigration Department by using an electronic medium.

Allowing Taxpayers to Leave the Country

The taxpayers are allowed to leave the country if:-

I. His taxes or debts due on the certificate have been paid in full.

II. The documentary evidence or payment receipt is submitted to the Inland Revenue Board of Malaysia (IRBM) branch office that handles his income tax file.

III. The cheque payment has been cleared by the bank. A revocation letter will then be issued to the taxpayer.

The taxpayer (excluding foreign nationals) who is unable to paid on his tax liability and debts fully will be allowed to leave the country with certain conditions as the following:

I. Making payment of at least 50% (or a rate as determined by the DG) of the amount of the claim in the certificate issued.

II. Payment is to be made in cash or bank draft to enable a letter for temporary release to be issued to the taxpayer. Documentary evidence or receipt must be submitted to show that payment has been made.

III. Payment by instalments for the balance of tax and debts must be arranged for resolving the outstanding amount.

IV. A taxpayer who fails to comply with the schedule of payments is not eligible to be considered for a subsequent application for temporary release to leave Malaysia.

A letter for temporary release will be issued and the period a taxpayer is allowed to travel out of the country will be stated in the letter.

Information on the revocation of the stoppage order and temporary release will be made available on the Immigration Department of Malaysia’s website.

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