Annual Report 2015

2016 Publication
© Inland Revenue Board of Malaysia (IRBM) 2016
All rights reserved. No part of this publication may be

reproduced or transmitted in any form or by any means,
electronic or mechanical, including photography,
recording or any other information storage or retrieval
system without prior permission from Chief Executive
Officer/Director-General of Inland Revenue Board of
Malaysia
Malaysian National Library

ISSN 1675 - 1612
CONTENTS
Chairman’s Report 4
Message from the Chief Executive Officer 8
Vision 10
Mission 10
Objective 10
Quality Policy 10
Slogan 10
Service Motto 10
Client Charter 11
IRBM’s Functions 12
IRBM’s Responsibilities 12
IRBM’s Core Values 13
Members of the Board 14

Top Management 16
Organisation Chart 17
Statement on Corporate Governance 18

2015 IRBM KPIs OF STRATEGIC OBJECTIVES 22
ACHIEVEMENT OF IRBM’s STRATEGIC OBJECTIVE KPI 2015
Achievement of KPIs of Strategic Objective #1 26

Collect Due Tax Fairly and Equitably

Instil Public Confidence in the Fairness
and Excellence of the Tax System Administration

Widen the Tax Base

Modernise the Work System and Procedures in Line with Current Needs

Develop Human Capital of Integrity Who Are Competent,
Professional and Dedicated
AWARDS & RECOGNITION 66
NATIONAL HIGHER EDUCATION FUND CORPORATION 70

1MALAYSIA People’s Aid (BR1M) 71
IRBM DIRECTORY 72
HASiL’s DIARY 74
FINANCIAL STATEMENT 82
FINANCIAL PERFORMANCE REPORT 115

2015 was a significant
year as it was the
pinnacle of the
implementation the
Tenth Malaysia Plan
(10 MP).
In addition to that, the
year also marked a
new beginning
for IRBM, having
changed its
status to a self-
financing agency.
4 ANNUAL REPORT 2015

CHAIRMAN’S REPORT Guided by the five (5) strategic objectives, the
BOARD OF DIRECTORS
IRBM’s achievements throughout 2015 were as
follows:
Bismillahirrahmanirrahim 1. Collect due taxes fairly and equitably

Assalamualaikum w.b.t and warm greetings
a. Tax Collection – The IRBM successfully
Praise be to Allah, with all His countless blessings the collected RM121.236 billion in direct
IRBM is able to issue its 2015 Annual Report. government taxes, a decrease of
9.32% compared to that in 2014. However,
2015 was a significant year as it was the pinnacle the achievement was 2.69% better as
of the implementation the Tenth Malaysia Plan compared to the preceding year if
(10 MP). In addition to that, the year also marked petroleum income tax was excluded.
a new beginning for IRBM, having changed its
status to a self-financing agency. Although still in b. Accounts Receivable – Up till 31 December
the transition process, through the alignment of 2015, as many as 619,337 tax arrears cases
strategies and competencies in the administration had been resolved. The achievement of
of taxation, the IRBM had successfully collected an reduction in tax arrears cases had reduced
encouraging total of RM121.236 billion in taxes. It the balance of the accounts receivable by
is clear that the efforts put towards modernisation 82.32%, equivalent to RM6.892 billion.
and change proved to be effective. Aside from
that, the firm support of taxpayers in meeting their c. Collection Cost Efficiency – The IRBM
obligations to pay taxes ought to be commended. achieved a collection costefficiency of
RM1.19, that is, not exceeding RM1.26 per
I am proud of the Hasilians’ persistence in RM100.00 of tax collected.
implementing the initiatives and achieving the
targets set by the government, despite the 2. Instil public confidence in the fairness and
economic challenges faced by the country, excellence of the tax system administration
especially the fall in the world’s oil prices. This
situation has affected the world economy, and a. Audit (Field Audit and Desk Audit) – Audit
Malaysia is not spared. Nevertheless, the IRBM of company files, namely C/CS/TA/TC and
remained staunch in ensuring that the collection TR files, resulting in resolution of 22.87% of files,
of taxes is at its best given the current economic as compared to the target of 15% of total
climate. active files; 21.30% of individual files OG, D,
TP, F, FA and J as compared to the set target
As Chairman of the board, I am hopeful that the of 18% of the total active files; 24.98% of
organisation remains relevant as the country’s tax individual SG employment files as compared
administrator, and is able to provide more efficient to the set target of 20%, and 16.57% of
and excellent service in all aspects. Apart from employer PCB files as compared to the
that, resolute commitment and efforts need to be target of 11% of total active files.
harnessed to implement the transformation that
would improve the country’s collection of direct b. Investigation – 1,063 cases were successfully
taxes. These efforts are important to ensure that the resolved as compared to the set target of
IRBM continues to be on the right track to achieve 720 cases.
its objectives through the exercise of its autonomy.
5

c. Refunds – 99.66% of refund claims were Police, Employees’ Provident Fund, Road Transport
settled as compared to the projected target Department and Companies Commission of
of 94% of the total claims received. Malaysia. Apart from that, the IRBM also obtained
the services of Percetakan Nasional Malaysia
3. Widen the tax base Berhad to print the forms and vouchers, as well as
Data Pos Malaysia Berhad to print and deliver letters
a. All types of files – An achievement of 4.51% of of notification to the BR1M applicants. The IRBM
registered files based on the number of active succeeded in processing a total of 7,289,117 or
files as compared to the set target of 3%. 88.2% of 8.2 million applications from those eligible
to receive BR1M for the year.
4. Modernise the work system and procedures in
line with current needs The BR1M registration and processing activities were
a great departure from the main function of the
a. IRBM electronic service – 3,575,740 tax return IRBM to collect taxes on behalf of the government.
forms were received as compared to the set Nevertheless, the IRBM has successfully implemented
KPI of 3,000,000. a government programme designed to fulfil the
hopes of the lower income group.
5. Develop a human capital of integrity who are
competent, professional and dedicated Once again, I wish to congratule all those involved
who have toiled endlessly to achieve the excellent
a. Training – IRBM successfully conducted 403 results of 2015. The dawn of 2016 marks the start of a
courses against the 248 courses planned. new episode for the IRBM as it continues its journey.
I am confident that the IRBM will continue to give its
b. Competence of officers and staff – The IRBM best to face the coming challenges of 2016.
officers achieved 834,884 (cumulative) hours
of training/courses as compared to the set To achieve the 2016 target of RM124.395 billion in
target of 414,270 hours. collection, the IRBM would need to focus primarily
on the following:
The 1Malaysia People’s Aid (BR1M) programme
was announced by the Prime Minister for the fourth i. Ensure that the level of visibility of enforcement
year during the tabling of the 2015 Supply Bill on activities is at its highest
10 October 2014. Registration for the 2015 BR1M
commenced on 1 December 2014 until 31 January ii. Enhance the quality of audit resolution,
2015, whereas the appeal period was from 1 March investigation and collection
2015 until 15 May 2015. To successfully implement
the BR1M programme, the IRBM worked together Finally, I hope that more programmes would be
with other government agencies for the purpose carried out to foster appreciation for the IRBM
of verifying applicants’ information, including the amongst the taxpayers as the taxpayers are an
National Registration Department, Royal Malaysian important asset that determines the country’s tax
6 ANNUAL REPORT
LAPORAN 2015
TAHUNAN 2015
revenue. The cooperation from taxpayers was
most welcome, and the IRBM wishes to thank you
for your unrelenting support.
Thank you.
TAN SRI DR. MOHD IRWAN

SERIGAR ABDULLAH
Chairman of the Board
Inland Revenue Board of Malaysia
7
2015 also saw the IRBM’s
continued recognition
both domestically and
internationally. The IRBM
received many awards
throughout the year, including
the Merit Award in the 2015
Asean Oceanian Computing
Industry Organisation
(ASOCIO) Awards in the Digital
Government category.
MESSAGE FROM
THE CHIEF EXECUTIVE
OFFICER
Bismillahirrahmanirrahim
Assalamualaikum w.b.t and warm greetings
Praise be to Allah, with all His countless blessings the

IRBM is able to issue its 2015 Annual Report. Many of
its achievements and successes are reported in this
publication.
Before I proceed, I would like to record my

appreciation and gratitude to the Prime
Minister of Malaysia, Datuk Seri Najib, for the
trust placed upon me to continue as the IRBM’s
Chief Executive Officer on a contract basis for

a further year commencing 12 December 2015. 2015 drew a close with the IRBM achieving distinct
I am deeply humbled and grateful for the faith success. Even faced with economic challenges
demonstrated by the highest leadership of the arising from global financial uncertainties and
government through this appointment. the fall in petroleum and commodity prices, the
IRBM through efficient administration, proved that
2015 was a notable year in that the IRBM underwent “Nothing is impossible and Impossible is Nothing”.
a change of status to become a self-financing
agency. This meant the granting of autonomy for the I am infinitely thankful for all those involved,
IRBM to manage its finances and human resources. especially Hasilians who have been the pulse of
As this was the first year of its self-financing era, the the IRBM to forge onwards to this day, and are the
transition phase was undoubtedly challenging, backbone of the country’s source of revenue. I also
involving the coordination of financial provisions thank the taxpayers who have always supported
and related administration. and understood the role played by the IRBM in
achieving the nation’s development agenda.
The collection of RM121.236 billion for the year Your cooperation is of the utmost importance to
proves that the IRBM remained excellent in enable the government to continually improve the
carrying out its responsibilities to collect direct standard of living and reduce the burden of the
taxes for the government, and even recorded people.
an increase in collection despite the exclusion of
petroleum tax this year compared to 2014. Driven Thank you.
by the theme, Breaking Barriers Hitting New Highs,
Hasilians achieved success despite facing hard
challenges, and gave their best throughout 2015.
Well done, Hasilians.
2015 also saw the IRBM’s continued recognition

both domestically and internationally. The IRBM
HONORARY COLONEL TAN SRI DATUK WIRA DR
received many awards throughout the year,
including, the Merit Award in the 2015 Asean
HAJI MOHD SHUKOR HAJI MAHFAR
Oceanian Computing Industry Organisation Chief Executive Officer/
(ASOCIO) Awards in the Digital Government Director-General of Inland Revenue
category. Apart from that, as the head of the Inland Revenue Board of Malaysia
organisation, I received recognition which reflected
the stakeholders’ confidence in the organisation,
including the Highest Category of Personality Class
for the Visionary Leader of the Year Award.
The prior significant contribution made by Malaysia

through the IRBM towards the tax system was
also internationally recognised when, as the
representative of Malaysia, I was elected the
President of the Commonwealth Association of
Tax Administration (CATA) from 2015 – 2018. This
appointment clearly defines the IRBM’s standing as
an equal to other tax administrators worldwide. I am
hopeful that this appointment will greatly benefit
Malaysia, and will further promote understanding
and cooperation among the member countries.
9
VISI
VISION
PENTADBIR CUKAI
Leading tax TERUNGGUL
administrator
MISI
MISSION
Memberikan perkhidmatan
Providing quality percukaian
taxation services yang berkualiti
of integrity towards dan berintegriti ke
arah meningkatkan
a higher pematuhan
level of voluntary sukarela
compliance
Objektives
OBJECTIVE
Melaksanakan sistem
To implement an pengurusan
effective, fair andpercukaian yang
equitable tax berkesan, system
administration adil dan
saksama
QUALITY POLICY
DASAR KUALITI
With integrity as our foundation, we are committed
providing the best service to the customers
Berteraskan integriti kami komited memberikan perkhidmatan yang terbaik
untuk pelanggan
SLOGAN
SLOGAN
Together we develop the nation
Bersama membangun negara
SERVICE MOTTO
MOTO PERKHIDMATAN
The best service for customers
Perkhidmatan terbaik untuk anda

CLIENT CHARTER
We are committed to continuously improve the service delivery system and provide a fair and just service
for all transactions based on the following standards:
1. To provide the current year Income Tax Return Form for:

• individual taxpayer - by end of February
• non-individual taxpayer - by the end of April
2. To provide e-Filing facility for the submission of the Income Tax Return Form
3. To refund excess payment/to issue repayment of income tax from the date a complete and accurate }
Income Tax Return Form is received via:
• e-Filing - 30 working days
• post or submitted by hand- 90 working days
4. To issue the tax clearance letter within 10 working days from the date the relevant completed
document is received
5. To initiate action on the property and land transfer instruments for the assessment of stamp duties as follows:
• to send the PDS 15 Form for valuation - 8 working days
• to issue the notice of assessment from the date the valuation report is received - 8 working
days
• to endorse the KTN 14A Form from the date the payment is received - 3 working days
6. To assess instruments other than property and land transfer instruments for:
• formal assessment - 5 working days
• informal assessment - 1 working day limited to 30 instruments per applicant
7. To resolve appeals/objections other than Form Q within 60 days provided complete information is
received
8. To process Form Q for submission to the Special Commissioners of Income Tax within 5 months from the
date of receipt
9. To take action on letters, faxes, and e-mails by issuing:

• acknowledgement letter within 3 working days from the date of receipt
• letter notifying progress status within 7 working days from the issuance of acknowledgement letter
if matters raised need further action
10. To answer telephone calls within 3 rings
11. To provide service at the counter within 15 minutes after obtaining the queue number

11
IRBM’S FUNCTIONS
To act as a government agent and to provide services in the administration, assessment, collection and
enforcement of income tax, petroleum income tax, real property gains tax, inheritance duty, stamp duty
and other taxes agreed upon between the government and the board
To advise the government on matters relating to taxation and cooperate with ministries and statutory bodies
regarding such matters
To participate in meetings, discussions and agreements pertaining to domestic or international taxation
To become collection agents for and on behalf of any body to recover loans payable to it under any written
law
To carry out any other functions given to the IRBM under any other written law
IRBM’S RESPONSIBILITIES
Administer the following laws:
• Income Tax Act 1967
• Real Property Gains Tax Act 1976
• Promotion of Investments Act 1986
• Stamp Act 1949
• Petroleum (Income Tax) Act 1967
• Labuan Business Activity Tax Act 1990

Adhere to laws relating to the administration of the IRBM:
• Federal Constitution 1957
• Interpretation Acts 1948 and 1967
• Limitation Act 1953
• Courts of Judicature Act 1964
• Companies Act 1965
• Bankruptcy Act 1967
• National Land Code 1965
• Criminal Procedure Code (Act 593)
• Penal Code (Act 574)
• Company Winding-up Rules 1972
• Rules of Court 2012
Administer repealed legislation to resolve outstanding cases such as:

• Estate Duty Enactment 1941
• Share (Land-based Company) Transfer Act 1984 (Act 310)
IRBM’S CORE VALUES

CORE VALUES MANTRA
HAPPY Hasilian is always cheerful and fun
TEAMWORK Work in a team
PROFESSIONAL Being professional
INTEGRITY Founded on integrity
EXCELLENCE To achieve excellence
13
MEMBERS OF THE BOARD
TAN SRI DR MOHD IRWAN
SERIGAR ABDULLAH
Secretary-General of Treasury
Malaysian Treasury HONORARY COLONEL TAN SRI
DATUK WIRA DR HAJI MOHD
SHUKOR HAJI MAHFAR
Chief Executive Officer/
Director-General of Inland Revenue
TAN SRI MOHAMAD
ZABIDI ZAINAL
Director-General of Public Services
Public Service Department
14 ANNUAL REPORT
LAPORAN 2015
TAHUNAN 2015
Left:
DATUK JUNAIDAH
HJ. ABD. RAHMAN
Commissioner of Law Revision
& Reform Attorney General’s
Chambers
Right:
KHODIJAH ABDULLAH
Secretary of Tax Division
Malaysian Treasury
Left:
DATO’ HAJI CHE PEE
SAMSUDIN
Accountant General of Malaysia
Accountant General’s
Department
Right:
DATUK HJ. MD AFENDI
DATUK HJ. HAMDAN
Private consultant
Left:
FADZLI ABDUL WAHIT
Private consultant
Right:
TAN SRI DATUK RASHPAL SINGH
A/L JESWANT SINGH
Private consultant
15
1
HONORARY COLONEL TAN SRI
TOP
DATUK WIRA DR. HJ. MOHD
SHUKOR HJ. MAHFAR
MANAGEMENT
CHIEF EXECUTIVE OFFICER/
DIRECTOR-GENERAL OF INLAND REVENUE
2
DATUK SABIN SAMITAH
DEPUTY CHIEF EXECUTIVE OFFICER
(TAXATION OPERATIONS)
3
DATO’ ABD AZIZ HASHIM
(COMPLIANCE)
4
NOOR AZIAN ABDUL HAMID
(POLICY)
5 DATUK MOHD NIZOM SAIRI

(MANAGEMENT)
2 3
4 5
1
16 ANNUAL REPORT 2015 LAPORAN TAHUNAN 2015

ORGANISATION CHART
MEMBERS OF THE BOARD
INTERNAL AUDIT
DEPARTMENT
CHIEF EXECUTIVE OFFICER/DIRECTOR-

GENERAL OF INLAND REVENUE
Honorary Colonel Tan Sri
Datuk Wira Dr Haji Mohd Shukor Haji Mahfar
DEPUTY CHIEF DEPUTY CHIEF DEPUTY CHIEF DEPUTY CHIEF

EXECUTIVE OFFICER/ EXECUTIVE EXECUTIVE EXECUTIVE
DEPUTY DIRECTOR- OFFICER/DEPUTY OFFICER/DEPUTY OFFICER/DEPUTY
GENERAL (TAXATION DIRECTOR-GENERAL DIRECTOR-GENERAL DIRECTOR-GENERAL
OPERATIONS) (COMPLIANCE) (POLICY) (MANAGEMENT)
Datuk Sabin Samitah Dato’ Abd Aziz Hashim Noor Azian Abdul Hamid Datuk Mohd Nizom Sairi
CHIEF EXECUTIVE
OFFICER’S
DEPARTMENT
TAX TAX TAX HUMAN RESOURCE
OPERATIONS COMPLIANCE POLICY MANAGEMENT
DEPARTMENT DEPARTMENT DEPARTMENT DEPARTMENT
DISPUTE
RESOLUTION
DEPARTMENT REVENUE INTERNATIONAL CORPORATE LOGISTICS
COLLECTION INVESTIGATION TAX DEPARTMENT
DEPARTMENT DEPARTMENT DEPARTMENT
DRAFTING & LAW
REVISION
DEPARTMENT INFORMATION LARGE CIVIL AND LITIGATION MALAYSIAN
PROCESSING TAXPAYER DEPARTMENT TAX
DEPARTMENT BRANCH ACADEMY
BOARD SECRETARIAT
& LEGAL ADVISORY
DEPARTMENT INFORMATION MULTINATIONAL
TECHNOLOGY TAXPAYER
DEPARTMENT BRANCH
STRATEGIC
PLANNING
DEPARTMENT PETROLEUM
BRANCH
RISK
MANAGEMENT
DEPARTMENT
SPECIAL
TASK
DEPARTMENT
FACILITY DEVELOPMENT
AND MANAGEMENT
DEPARTMENT
INTELLIGENCE
DEPARTMENT
FINANCE
DEPARTMENT
CORPORATE OFFICE OF FEDERAL OFFICE OF KEDAH/

TERRITORY OF PERLIS STATE DIRECTOR OFFICE OF PERAK OFFICE OF SELANGOR
SERVICES KUALA LUMPUR STATE STATE DIRECTOR STATE DIRECTOR
DEPARTMENT DIRECTOR
OFFICE OF PENANG OFFICE OF

TAX OFFICE OF PAHANG TERENGGANU/ OFFICE OF SARAWAK
STATE DIRECTOR STATE KELANTAN STATE
RESEARCH DIRECTOR STATE DIRECTOR
DEPARTMENT DIRECTOR
OFFICE OF NEGERI OFFICE OF FEDERAL

INSPECTORATE OFFICE OF SABAH TERRITORY OF OFFICE OF JOHOR
STATE DIRECTOR SEMBILAN/MELAKA PUTRAJAYA STATE STATE DIRECTOR
& INTEGRITY STATE DIRECTOR
DEPARTMENT DIRECTOR
17
STATEMENT ON
CORPORATE
GOVERNANCE
2015 unveiled a new beginning for the IRBM when, on 30 December 2014, Parliament passed the Inland Revenue
Board of Malaysia (Amendment) Act 2015 [Act A1475] to amend Act 533 related to its establishment as a
statutory agency. The Amendment Act made the IRBM a self-financing and autonomous agency. It gave the
IRBM the freedom to determine its direction including the management of its own revenue source, remuneration
(salaries and compensations) and human resources (services and postings) without having to refer to any central
agency such as the Public Service Department or the Ministry of Finance for consent.
This historical success of the IRBM demonstrates the government’s confidence in the stable administration and
management of the country’s direct tax collection. Act A1475 enlarges the board from seven to nine members,
subsequent to the appointment of the Chief Executive Officer as a board member and the appointment of a
Ministry of Finance nominee.
Board Membership
Act A1475 prescribes that the board shall comprise nine invidivuals including the Chairman and the Chief
Executive Officer as follows:
a. Secretary-General of Treasury who shall be the Chairman

b. Attorney General or his representative
c. Director-General of Public Services
d. Chief Executive Officer of the IRBM
e. Two government representatives nominated by the Ministry of Finance
f. Three representatives of the private sector who are influential and experienced in matters of finance,
commerce, taxation or law nominated by the Ministry of Finance
The board composition is in line with best practices and ensures a balance of power in order to increase
accountability and responsibility for making independent decisions. The board members comprise individuals
with commendable achievements who have a variety of expertise and are competent and experienced.
The Chairman manages and provides leadership to the board to deliberate on matters brought to the board’s
attention and oversees each of the board’s decision translated into executive action.
The primary role of the Chief Executive Officer is to be the Director-General of Inland Revenue as prescribed by
Section 134(1A) of the Income Tax Act 1967, which involves the administration and management of taxes. At the
same time, under Section 6A(1) of Act A1475, the Chief Executive Officer is also responsible for the administration
of day-to-day operations. Both roles are performed effectively in line with the strategies and policies, in addition
to provide supervision, guidance, advice and leadership for the senior management.
In 2015, six board meetings were held with attendance in excess of quorum for all meetings.

Board Committees
For the purpose of executing the functions of the board, several main committees were established in which
membership of each committee was determined by the Chairman of the board from amongst the board
members. The committees are as follows:
a. Procurement Committees A and B

b. Finance Committee
c. Investment Committee
d. Disciplinary Committee 1
e. Disciplinary Appeal Committee
f. Human Resource Management Committee 1
g. Risk and Compliance Committee
Each of the committees are tasked with acting on complex, specific and specialised issues. The recommendations
and proposals for action made by a board committee shall be directly tabled at the board meeting for decision.
This collective responsibility is an effective practice in upholding corporate governance.
Risk Management and Internal Control
To achieve objectives and sustain the successes achieved in the administration of taxation, managing revenue
collection requires effective governance, risk management and internal control processes that are in line with
the objectives. For this purpose, the IRBM has a well defined risk management and internal control function
incorporated into its corporate governance framework.
The Risk and Compliance Committee supervises matters of risk management and internal control to ensure that
the risk monitoring framework is entrenched in the organisation’s culture, structure and work processes. The 2015
IRBM Corporate Risk Profile is produced based on the data obtained from the Risk Management Information
System (i-RIS) and segregated according to strategic, compliance, operational or financial risk. At the same
time, the performance evaluation report by the Tax Administration Diagnostic Assessment Tool (TADAT) is also
utilised to develop a tax compliance risk management programme in the future.
Implementation of internal control processes on the other hand, covered the aspects of finance, operations,
environment and compliance with work procedures to manage any risks and ensure that the objectives set were
achieved. The framework for internal control is guided by Governance Directive 1-2014 (Financial Management
Accountability Checklist for Capital Asset and Inventory Control Procedure, Vehicle Management and Store
Management in the IRBM) together with Governance Directive 1-2015 (Financial Management Accountability
Checklist for Procurement Management Control Procedure and Management of Payment for IRBM Supplies/
Services).
On the whole, the IRBM’s system for the management of risk and internal controls runs smoothly and effectively
based on the needs and available information.
19
2015 IRBM KPIs OF
STRATEGIC
OBJECTIVES

21
2015 IRBM
KPIs OF
STRATEGIC
OBJECTIVES
STRATEGIC MAIN
KPI ACHIEVEMENT
OBJECTIVE PROCESS
Collection Gross: Gross:

of Taxes
RM123.760 Billion RM 121.236 Billion
Account Reduced 59.00% from account Reduced 82.32% From
Receivables Account Receivables
Collect due receivables (RM8,310 milllion)
taxes fairly and Involving An Amount Of
on 1/1/2015: RM4.871 billion
equitably Rm6.892 Billion
Collection Cost Not exceeding RM1.26 per every Not Exceeding Rm1.19
Efficiency
RM100.00 in tax collected Per Every Rm100.00
in Tax Collected
Company files (C/CS/TA/TC/TR): Company files (C/CS/TA/

TC/TR):
15% of active files: target of
Resolved 138,203
90,628 cases
cases
Individual files (OG/D/TP/F/FA/J): Individual files
(OG/D/TP/F/FA/J):
18% of active files: target of
Audit (Field Resolved 403,730
Audit And
341,152 cases
Desk Audit)
cases
Instil public
confidence in Employment files (SG): 20% of Employment files (SG):
the fairness and active files: Resolved 1,172,979
excellence of 939,106 cases cases
the tax system
administration Employer MTD: Employer MTD:
11% of active files: 52,061 Resolved 78,404
cases cases
Investigation Target number of cases: Number of cases resolved:

720 cases 1,063 cases
Refund Resolve 94% Of Resolved 99.66% of
Refund Applications refund applications

STRATEGIC MAIN
KPI ACHIEVEMENT
OBJECTIVE PROCESS
3% increase on Registered
Widen The Tax 7,666,288 active 345,687Files
All types of files
Base
files or 230,049 files
Modernise The IRBM’s 3,000,000 Tax Return 3,575,740 Tax Return

Work System And electronic Forms Received Forms Received
Procedures In services: e-Filing
Line With Current
Needs
Training Implement Implemented

94% from 248 Malaysian Tax Academy 403 training
Develop Human training programmes: programmes
Capital Of
Integrity Who Are 233 courses
Competent,
Professional And Competence of Officers achieved a minimum of Officers attained
Dedicated IRBM officers
and staff
40 hours of training/courses ir 834,884 hours
(cumulative) of training/
target of 414,720 hours
courses
23
ACHIEVEMENT OF IRBM’s
STRATEGIC OBJECTIVE KPI 2015
25
ACHIEVEMENT
OF KPIs OF
STRATEGIC
OBJECTIVE #1
COLLECT DUE TAX FAIRLY AND EQUITABLY
Collection of Direct Taxes
The IRBM was successful in collecting gross direct taxes of RM121.236 billion this year and contributed 55.34% of
the total federal revenue collection of RM219.089 billion. Even in the face of global economic challenges,
particularly the fall in petroleum prices which impacted the 2015 collection, the collection from other
components such as from companies, individuals, withholding tax, real property gains tax (RPGT) and the
Labuan International Offshore Centre (IOFC) still showed an increase by 1.64%, 6.09%, 5.65%, 39.68% and
37.36% as compared to 2014.
2015
(RM Billion)
2014
(RM Billion) Gross
direct taxes
Gross direct Taxes collection 121.236 133.700
Tax reimbursement fund (TRF) 7.000 7.000 RM121.236

Nett direct tax collection 114.236 126.700 billion
Government's revised forecast 116.760 133.148 this year
Federal goverment revenue 219.089 225.094
The gross collection contribution of the federal government revenue and nett collection contribution of the
revised forecast for 2015 were 55.34% and 97.84% respectively, as compared to 59.40% and 95.16%
in 2014.

Collection of Direct Taxes by Component
-
Companies
01 2015 : RM71,098.14 Million
2014 : RM69,948.08 Million
Others** Petroleum
2015 : RM33.95 Million 09 02 2015 : RM11,636.88 Million
2014 : RM26,971.47 Million
2014 : RM28.66 Million
OVERALL
Labuan IOFC*
TOTAL
Individuals
2015 : RM36.88 Million 08 03 2015 : RM28,276.97 Million
2014 : RM26.85 Million
2015 2014 : RM26,654.91Juta
RM121,235.84 Million
2014
RM133,700.11 Million
Real Property
Cooperatives
Gains Tax
2015 : RM1,725.54 Million
07 04 2015 : RM81.49 Million
2014 : RM170.11 Million
2014 : RM1,235.36 Million
Withholding tax Stamp Duty

2015 : RM2,329.74 Million 06 05 2015 : RM6,016.25 Million
2014 : RM2,205.10 Million 2014 : RM6,459.57 Million
* IOFC (International Offshore Centre)

** Others cover payments pursuant to Section 124 of the Income Tax Act 1967, court charges, bank interest, revenue from
legal suits, business registration and service fees pursuant to Section 138B of the Income Tax Act 1967
Collection by Method of Payment
*Payment Counter Bank Counter Internet Banking Others** Total

Year and Through Mail (RM Million) (RM Million) (RM Million) (RM Million)
(RM Million)
2015 54,110.62 31,001.29 36,116.70 7.23 121,236
2014 71,093.43 28,419.84 34,186.83 0.009 133,700
* Payment counters at Kuala Lumpur, Kuching and Kota Kinabalu Payment Centres
** Encompasses stamp duty, estate duty, business registration and others
Collection of Withholding Tax
Section 107A Section 109/109B Section 109C Section 109D Total

Tahun (RM Million) (RM Million) (RM Million) (RM Million) (RM Million)
2015 208.12 2,083.80 4.93 32.89 2,329.74

2014 176.67 1,985.95 3.06 39.42 2,205.10
27
Collection by Monthly Tax Deduction (MTD)
Monthly tax deduction (MTD) is a mechanism for schedular deduction of income tax from an employee’s monthly
remuneration in accordance with the Schedule of Monthly Tax Deductions as provided for in the Income Tax
(Deduction from Remuneration) Rules 1994 (MTD Rules). This deduction aims to reduce the employees’ burden
of having to pay taxes in a lump sum upon the calculation of actual taxes due. The MTD Rules are provided for
under subsection 107(2) of the Income Tax Act 1967.
MTD Collection from the Overall Total Revenue Collection
2015 2014
MTD MTD
Collection Collection
Total Revenue Total Revenue
Collection RM20,684 Collection RM19,763
RM121,236 Million RM133,700 Million
Million Million
MTD Collection by Method of Payment
2015 2014
Bank
Counters
RM846.33 Bank
Million Counters
RM1,089.67
Internet
Banking
Million
RM3,815.04
RM20,684 Million
RM19,763 Million
Internet
Million Banking
RM3,919.37
Total
Total
Million
IRBM
Payments IRBM
Counters Payments
RM16,022.63 Counters
Million RM14,753.56
Million

Collection of Revenue Service Centres (RSCs)
RSCs are customer service centres which provide services such as stamp duty, income tax advisory services and
such other services as directed by the Ministry of Finance including BR1M. A list of all IRBM RSCs in the whole of
Malaysia and their respective collections up until December 2015 is as follows:
2015 2014
Revenue Service Centre
(RM) (RM)
Alor Gajah RSC 1,564,244.10 1,832,578.60
Batu Pahat RSC 39,752,364.55 45,991,099.74
Bentong RSC 35,338,147.90 34,559,924.60
Besut RSC 2,476,310.80 2,345,010.15
Cyberjaya RSC 31,855,241.20 31,895,602.55
Hulu Langat RSC 105,825,318.74 133,007,749.66
Jasin RSC 3,605,283.60 2,061,712.60
Jerantut RSC 5,494,761.90 5,568,826.60
Kemaman RSC 10,455,154.95 10,148,062.75
Kuala Kangsar RSC 3,366,666.05 729,891.25
Kuala Langat RSC 14,491,738.25 16,177,755.90
Kuala Pilah RSC 4,953,605.15 5,060,177.30
Kudat RSC 597,003.00 546,138.00
Kulim RSC 9,364,171.84 10,392,242.65
Lahad Datu RSC 2,938,153.00 2,646,617.85
Langkawi RSC 4,359,364.40 3,531,915.05
Limbang RSC 1,720,781.05 1,801,839.80
Manjung RSC 28,502,927.51 31,267,293.30
Mukah RSC 968,409.15 83,656.00
Pontian RSC 10,567,347.55 10,283,691.50
Seberang Perai RSC 11,293,886.45 10,232,887.90
Segamat RSC 15,822,328.06 14,864,781.38
Sri Aman RSC 1,533,933.40 1,164,269.55
Tampin RSC 4,402,116.50 4,396,633.20
Tanah Merah RSC 1,423,587.95 2,422,493.70
Hulu Terengganu RSC 1,864,815.25 -
Dungun RSC 4,347,029.75 -
29
2015 2014
Revenue Service Centre
(RM) (RM)
Baling RSC 99,775.50 -
Kota Tinggi RSC 3,710,941.95 -
Kuala Krai RSC 36,323.00 -
Kuala Selangor RSC 5,053,599.90 -
Kubang Pasu RSC 1,228,957.70 -
Mersing RSC 161,899.00 -
Parit Buntar RSC 361,867.25 -
Rawang (Gombak)RSC 4,359,631.15 -
Yan RSC 379,636.55 -
Gua Musang RSC
Jempol RSC
Pasir Mas RSC
Pasir Puteh RSC

UNDER PLANNING
Petaling RSC
Port Dickson RSC
Sabak Bernam RSC
Sepang RSC
The total collection from RSCs throughout Malaysia for 2015 was
RM374.28 million
Company Tax Estimation (Form CP204) and Instalment Payment Scheme for Individuals (CP500)
2015 2014
Number of CP204 forms received 188,075 361,786
Estimated tax from CP204 (RM million) 59,983.67 51,486.30
Number of CP500 forms issued 331,595 363,221
Instalment payments from CP500 (RM million) 2,696.60 2,588.22

Tax Management Efficiency
The collection cost spent for every RM100 of direct taxes collected was RM1.19 compared to the KPI of RM1.26.
The lower ratio as compared to the target KPI demonstrates the effectiveness of cost controls as well as the
effectiveness of the IRBM’s activities which were planned and implemented by emphasising quality improvement
and achievement.
Performance of Account Receivables
Up until 31 December 2015, as many as 619,337 tax arrears cases were successfully settled. The reduction in
cases educed the balance of account receivables by as much as 82.32%, involving an amount of RM6.892
billion.
Prohibition from Leaving the Country
Apart from the issuance of reminder letters and notice of tax arrears to defaulting taxpayers, the IRBM also
enforces restrictions from leaving the country pursuant to Section 104 of the Income Tax Act 1967 and Section 22
of the Real Property Gains Taxt Act 1976 until the said tax is paid in full. This action to restrict defaulting taxpayers
from leaving the country is generally only enforced after all efforts have been made to collect with no success
due to the obstinacy of the taxpayers.
The IRBM has resorted to such a measure in order to ensure all taxpayers are equal under the tax system and that
no one is exempt from settling their taxes. Taxpayers who have difficulty settling their tax arrears may contact the
IRBM to request for an instalment payment plan.
Registration of Stoppage Order

Register
Amount
Amount
Type Registered Registered
Registered Registered Total
Cases up until up until Total Cases
Cases 2015 2015 Amount
31.12.2014 31.12.2014
(RM Million)
(RM Million)
Sec 104 116,196 3,254.10 40,435 599.14 156,631 3,853.25
Sec 22 12,816 203.89 4,316 58.69 17,132 262.58
Revocation of Stoppage Order

Revoke
Amount
Type Revoked Revoked Amount
Revoked up Total Total
Cases up until Cases Revoked 2015
until 31.12.2014 Cases Amount
31.12.2014 2015 (RM Million)
(RM Million)
Sec 104 41,043 1,041.98 14,277 256.05 55,320 1,298.03

Sec 22 5,786 93.60 2,087 29.39 7,873 122.99
The number of cases and amount of arrears on which stoppage order were enforced up until 31 December 2015
(including cases registered before 2015) for Sections 104 and 22 are 101,311 cases/RM2,555.22 million and
9,259 cases/RM139.59 million respectively.
31
The best practices observed by other tax administers are frequently referred to ensure that Malaysia’s tax system
is of international standard. This is a strategy required to ensure consistent taxation practices in the IRBM’s efforts
to be fair towards taxpayers who are subject to multiple tax jurisdictions at one time. For this purpose, the IRBM is
party to collaborations, smart partnerships and agreements with tax administrators of other nations to deal with
the challenges relating to impediments to information transparency.
Double Taxation Avoidance Agreement (DTAA)
The DTAA is an agreement between the government of Malaysia and the government of a contracting country
for the purpose of avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on
income.
Up until the end of 2015 Malaysia had 74 DTAAs and one Tax Information Exchange Agreement (TIEA) in force.
The TIEA is an agreement signed by the contracting countries specifically to cooperate on matters of taxation
through the exchange of information. The DTAA on the other hand is a comprehensive agreement relating to
the treatment of taxation between the contracting countries.
Negotiations for DTAA with Belarus took place successfully in 2015, whereas DTAA between the government of
Malaysia and the government of the Republic of Slovak was gazetted to be tabled in Parliament for ratification
of the said DTAA.
Represented by the IRBM, Malaysia attended meetings to discuss international taxation issues. Through Working
Party No. 1 (Tax Conventions and Related Questions), Malaysia was also involved in the Base Erosion and Profit
Shifting initiative which took place in the Working Party No. 1 discussion. More than 94 countries were involved in
this initiative to strengthen the network of taxation agreements and prevent tax evasion.
List of DTAAs in Force

South Africa Philippines Morocco San Marino
Albania Finland Malta Spain
United States of America Hong Kong Mauritius Seychelles
Saudi Arabia Hungary Egypt Singapore
Argentina India Mongolia Sri Lanka
Australia Indonesia Myanmar Sudan
Austria Iran Namibia Sweden
Bahrain Ireland Netherlands Switzerland
Bangladesh Italy New Zealand Syria
Belarus Japan Norway Thailand
Belgium Germany Pakistan Turkey
Bosnia Herzegovina Jordan Papua New Guinea Turkmenistan
Brunei Canada France United Kingdom
Chile Kazakhstan Poland Uzbekistan
China South Korea Qatar Venezuela
Croatia Kuwait Czech Republic Vietnam
Denmark Laos Kyrgyz Republic Zimbabwe
United Arab Emirates Lebanon Romania
Fiji Luxembourg Russia

Malaysia’s Commitment to International Information Exchange
The main role of the International Information Exchange Unit is to handle information exchange with the tax
authorities of the DTAA countries. In general, the type of information exchange covers specific information
exchange, spontaneous information exchange and automatic information exchange.
Specific information exchange occurs when a contracting country’s tax administrator requests for particular
information from the tax administrator of another contracting country, whereas a spontaneous information
exchange takes place when a contracting country presents any information produced from an audit or
investigation that it deems useful to another contracting country. This information is presented as a notification.
An automatic information exchange occurs when a contracting party presents taxpayers’ information to
another contracting country in bulk, in a systematic manner from time to time.
Apart from handling the exchange of information in 2015, the International Information Exchange Unit also sent
5 officers to attend workshops overseas to learn the techniques for improving the effectiveness of information
exchange. The first workshop was Enhancing Effective Exchange of Information which was organised by the
Asian Development Bank in Manila, Philippines and the second workshop, Detecting Cross Border Evasion was
organised by the Asian Development Bank in Japan.
With regard to automatic information exchange, Malaysia had given its commitment to implement the same
in accordance with the Common Reporting Standard (CRS) beginning 2018. To fulfil its obligations in respect
of this commitment, the International Information Exchange Unit has made preliminary preparations to sign
the Convention on Mutual Administrative Assistance on Tax Matters (CMAA) and the Multilateral Competent
Authority Agreement on Automatic Exchange of Financial Account Information (MCAAAEOI).
On 1 July 2015, the Information Exchange Unit issued a draft IGA FATCA explanatory note for the reference of
financial institutions. On 11 September 2015, the draft was updated after taking into account the comments
received from the financial institutions. Up until 23 December 2015, 568 financial institutions have registered with
the IRS for the purpose of delivering information in accordance with the IGA FATCA.
Mutual Agreement Procedure
Throughout 2015 there were no new applications related to the mutual agreement procedure (MAP). However,
on a cumulative basis, six cases were handled, with 1 case resolved. The existing cases involved four contracting
countries and concerned various issues such as transfer pricing, technical fees, and requests for bilateral
advance pricing arrangement and representative office.
MAP Guideline was uploaded onto the IRBM’s official website on 28 January 2015. It sets out the procedures
for obtaining assistance from the competent authority of Malaysia to resolve any issues relating to taxation with
contracting countries.
33
ACHIEVEMENT
OF KPIs OF
STRATEGIC
OBJECTIVE #2
INSTIL PUBLIC CONFIDENCE IN THE FAIRNESS AND EXCELLENCE
OF THE TAX SYSTEM ADMINISTRATION
Tax Audits
Administration of a tax system that is fair, transparent and equitable can enhance the confidence of the public
in the said tax system. Compliance with taxation laws is strictly enforced and action is taken against any tax
offences such as non-compliance or tax evasion in accordance with the provisions of the Income Tax Act 1967
and other related legislation.
Under the self-assessment system, the main acitivity of the IRBM is the conduct of the tax audit to improve
voluntary compliance amongst taxpayers. A tax audit involves examination of business records and the financial
affairs of the taxpayer to ensure that the income that ought to be reported and the tax that ought to be
calculated and paid are in line with the laws and regulations of taxation. The IRBM conducts two types of audits,
namely desk audits and field audits.
The Monitoring Deliberate Tax Defaulters (MDTD) programme was introduced to empower and increase the
effectiveness of the existing tax audit activity. It was created to monitor taxpayers who have been identified as
having failed to comply with the laws and regulations currently in force.
Tax audits focus on the following matters:
- Audit of high risk cases, cases where there is risk of transfer pricing and high income taxpayers
- Ensuring that audit cases are resolved in an orderly manner, and that the audit is of high quality and conducted
within the period determined
- Focus on resolving cases that would result in collection of actual taxes
- Ensuring that the cases are handled fairly and with minimal appeals
To ensure the fairness and excellence of administration of the tax system, all cases selected for audit will be
audited in an orderly manner, guided by the framework, audit manuals, work procedure manual, directives,
circulars and memorandums currently in force.

Overall Tax Audit Performance for Field Audits and Desk Audits
2015 2014
Number of Cases Taxes and Penalties Number of Cases Taxes and Penalties
Resolved (RM) Resolved (RM)
Cases Involving 138,203 7,783,693,882.44 98,615 2,307,798,760.59
Companies
Cases Not Involving 1,576,709 2,059,835,351.99 1,771,317 2,169,621,401.92
Companies
Cumulative Total 1,714,912 9,843,529,234.43 1,869,932 4,477,420,162.51
Field Audit Performance
2015 2014
Cases resolved 37,305 40,216
Taxes and penalties (RM) 3,972,423,691.29 1,092,143,888.23
Desk Audit Performance
2015 2014
Cases resolved 1,677,607 1,829,716
Taxes and penalties (RM) 5,871,105,543.14 3,385,276,274.28
Monthly Tax Deduction (MTD) Audit
The main objective of conducting an MTD audit is to enhance the level of MTD as final tax compliance and
CP38 deduction by employers. In addition, it checks the level of employer compliance in carrying out the
deduction of taxes from employees’ remuneration and remitting the same to the IRBM in accordance with the
Income Tax (Deduction from Remuneration) Rules 1994. The MTD audit is conducted by examining the salary
records of employees on the premises of the employer to ensure that the employer makes the appropriate tax
deductions from the eligible remuneration and remits the said taxes to the IRBM within the prescribed period.
MTD Audit Performance
Non-compliant Insufficient Total Number of

Number of
Employers Tax Compound Taxes & Offences
Year Employers
Deductions Fines (RM) Compound Charged in
Audited Number % (RM) Fines (RM) Court
2015 78,576 21,696 28 % 134,188,977 24,228,292 158,417,268 1,594
2014 70,331 16,780 24 % 100,414,174 13,028,836 113,443,010 1,427
Transfer Pricing Audit
The 36th Annual Commonwealth Association of Tax Adminitrators’ (CATA) Technical Conference was held in
November 2015 in Melaka. Amongst the matters discussed were the effort made to handle transfer pricing issues
35
and base erosion and profit shifting/BEPS, as these two issues were jointly faced by all tax administrators in the
world. They are often utilised by multinational companies to reduce taxes paid, or even to avoid paying tax at
all in a country. During the conference the IRBM shared the actions taken by the country to overcome the issue
of transfer pricing/BEPS.
The transfer pricing issue was also discussed at the 17th SGATAR Working Level Meeting which took place on
22 to 24 June 2015 in Ulaanbaatar, Mongolia. The objective of the meeting was to find a practical solution to
issues of transfer pricing.
Apart from that, a consultantion session with taxpayers (MNE’s) on country by country reporting (CBC) was held
on 30 November 2015 at the IRBM headquarters in Cyberjaya. The feedback from the consultation session will
be used for the preparation of the CBC Rules. CBC reporting is expected to commence in 2018
Transfer Pricing Audit Performance
2015 2014
Cases resolved 250 168
Taxes and penalties (RM million) 124.87 155.94
Investigation
Investigation is one of the enforcement steps undertaken by the IRBM to prevent tax evasion and to enhance
voluntary tax compliance. It provides also fairness to the taxpayers who comply.
Investigative visits are conducted on business premises, places of residence and/or other related premises
without prior notification to the taxpayer. Investigations are conducted according to the rules outlined in the
Framework for Tax Investigations to ensure that they are carried out fairly and in a transparent and equitable
manner.
Aside from the provisions of the Income Tax Act 1967, the IRBM also refers to the provisions of the Real Property
Gains Tax Act 1976, the Petroleum Act 1967, Promotion of Investments Act 1986, Stamp Duty Act 1949, Labuan
Business Activity Tax Act 1990 and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful
Activities Act 2001 (AMLATFPUAA) to resolve the cases investigated.
Investigation Performance
2015 2014
Cases resolved 1063 689
Taxes and penalties (RM million) 755.44 543.96

The action to charge taxpayers in court for tax offences is expected to have a great impact on voluntary
compliance. In 2015, the Investigation Branch charged as many as 182 cases with various criminal offences
under subsections 112(1), 113(1) and 114(1) of the Income Tax Act 1967.
Dispute Resolution
Dispute resolution is an alternative process of arbitration or negotiation and settlement founded on three
important elements, namely, increasing revenue collection, enhancing public confidence and saving time and
cost.
Apart from that, it is also in line with the stakeholders’ demand to enhance society’s confidence in the fairness
of the country’s tax system and to ensure that the right to be heard is upheld and implemented in the IRBM.
The Dispute Resolution Department plays a role as an independent body in resolving taxpayers’ tax disputes.
The introduction and implementation of the Appeal Review Panel (internal hearing) and Dispute Resolution
Proceedings (external hearing) provide a new opportunity to taxpayers and raises the taxpayers’ confidence in
the transparency of the country’s tax system.
Dispute resolution is divided into 2 divisions, namely:

a. Tax Resolution Division
b. Tax Litigation Division
The Tax Resolution Division processes Form Q appeals, applications for extension of time (Form N), application for
relief under section 131 of the Income Tax Act 1967 and application for tax remission under paragraph 129(1)(b)
of the Income Tax Act 1967 submitted by taxpayers. In carrying out these functions, the Tax Resolution Division,
which is not involved in the drafting of taxation laws or in raising assessments, is deemed an independent entity
which considers taxpayers’ appeals in accordance with existing taxation legislation and policies.
The function of the Tax Litigation Division, on the other hand, is to handle Form Q appeal cases at the levels of
the Special Commissioners of Income Tax, High Court and Court of Appeal. At the same time this division also
handles judicial review cases at the High Court, Court of Appeal up to the Federal Court.
Tax Resolution Division Form Q Performance
Special Commissioners of Income Tax

RPGT
Objection Company Individual*
2015 2014 2015 2014 2015 2014
In the process (b/f)** 190 67 10 4 6 2
Filed in the current year 362 331 77 40 15 27
Total 552 398 87 44 21 29
Resolved 450 208 68 34 20 23
In the process (c/f)*** 102 190 19 10 1 6
* Inclusive of trust bodies, organisations and partnerships
** b/f : brough forward from the previous year
***c/f : carried forward to the following year
37
Tax Litigation Division Form Q Appeal Performance
Special Commissioners
High Court Court of Appeal
Objection of Income Tax
2015 2014 2015 2014 2015 2014
In the process (b/f)** 267 197 61 47 36 44
Filed in the current year 268 196 15 22 12 12
Total 535 393 76 69 48 56
Resolved 175 126 12 8 13 20
In the process (c/f)*** 360 267 64 61 35 36
Refund
In general, it is the IRBM’s policy to refund excess credit even without an application from taxpayers. In
accordance with the client charter, refunds shall be made within 30 working days of receipt of the income
tax return form through e-Filing and 90 working days for manual applications. Domestic refunds are paid via
electronic fund transfer while telegraphic transfer is used for overseas refunds. The effectiveness of the refund
process in accordance with the set procedures can enhance taxpayers’ confidence in the excellence of the
IRBM’s administration of the tax system.
Refund Performance
2015 2014
No. of Cases 159,731 114,348
Companies
Amount (RM Million) 3,686.01 5,701.46
No. of Cases 1,746,342 1,712,361
Other than Companies*
Amount (RM Million) 1,853.07 2,466.26
* Inclusive of refund of stamp duty
Reinforcement of the Governance of Taxation
Compliance Audit Programme
A compliance audit programme has been continuously implemented to ensure that taxation activities are
conducted competently and systematically in accordance with the acts/circulars/directives/memorandums in
force to enhance internal controls. The programme is also implemented in line with the rules and work procedures
based on the acts/circulars/directives/memorandums in force to improve work performance.
To ensure the effectiveness of the IRBM’s service delivery which covers operational risk, 10 branches were
selected to be audited based on the IRBM’s 3 core activities:
i. Widening of the Tax Base
• To ensure that the information received at branches is processed and stored in the Detection Unit Information
System (DUIS) and that potential cases are resolved at CMS Detection
• To ensure that appropriate action is taken on third party income information received, whether by raising
assessment through the distribution of CMS code 44 or by making further queiries to the taxpayer
• To ensure that action is taken against cases with credit balance in the ledger

ii. Real Property Gains Tax
• To ensure that action to raise and collect is taken on current and year end debit cases
• To ensure that action to refund is taken for eligible cases
iii. Document Management and Handling of Appeals
• To ensure that the management of documents in branches, such as the process of scanning, uploading,
distribution and further action with regard to taxpayers’ appeals, is duly acted upon
• To ensure that cases of reduced / additional assessment in relation to an appeal are acted upon in
accordance with the prescribed directives
Based on the sampling conducted for every activity in totality, these three activities
are managed in line with the principles of due diligence and are in compliance
with the directives and controls currently in place.
It is recommended that monitoring of procedural and work process non-compliance as well as integrity
controls be improved in order to enhance the competence of the IRBM officers. High compliance with
procedures and work processes is also indirectly able to enhance the public’s confidence in the fairness and
excellence of the IRBM’s administration of the tax system.
IRBM’s Response to the Findings of the Auditor General’s Department
The Inspectorate and Integrity Department is responsible for coordinating the responses to the findings of the
Auditor General’s Department and the Auditor General which are reported in the Auditor General’s Report.
Series 3, 2014 of the Auditor General’s Report was tabled in Parliament on 23 November 2015 and touched
on the following topics:
i. Management of withholding tax

ii. Management of taxation in respect of residents carrying out business file type OG
Subsequent to the tabling of the Auditor General’s Report, the Inspectorate and Integrity Department
submitted a response to the Auditor General, the Corporate Strategy and Communication Division of the
Ministry of Finance, the Coordination Section of the Auditor General’s Department, the AG’s Dash Board and
the Audit Committee at the Ministry of Finance
Internal Auditor for Procurement of Quality Standard (MS ISO 9001:2008)
The Inspectorate and Integrity Division was appointed to play the role of lead auditor for MS ISO 9001:2008,
for the following determined scope:
a. Existing scope;
i. The process of refunding employed individuals in cases of e-Filing/m-Filing
ii. The procedure for implementation of external audit on company cases (focus audit)
39
b. New scope;
i. The process of acceptance, preparation and filing of a writ of summons and statement of claim (WSSC) in
respect of OG files for income tax cases
ii. The procedure for implementation of temporary exemption and lifting of travel restriction on individuals
other than company directors
Special Study on the Effectiveness of IRBM’s Strategies to Increase Revenue Collection
To reinforce tax governance, a special study on the effectiveness of the strategies was planned to focus mainly
on the planned objective to achieve the revenue collection target, as well as to improve compliance amongst
taxpayers. This study also identified the causes or the problems that needed to be overcome together with
recommendations for improvement.
a) Effectiveness of the Focus Audit
Objectives Recommendations for Improvement
The study was carried out to √ Review of the Method of File Distribution from the Headquarters
assess the effectiveness of • Turnover/transaction volume/complexity of the case needs to
implementation of external focus be considered
audits on cases of companies • The Headquarters must select cases that have potential and
and other than companies as are of quality
compared to the conduct of
comprehensive audits in achieving √ Empowerment of Competence / Expertise of the EAO
increased revenue collection. • The EAO’s skills must be improved through continuous and
The aspect of effectiveness was comprehensive training
studied based on the analysis of • A potent mentor-mentee programme
the achievement of the external • Monitoring activities are to be intensified by process owners so
audit officer (EAO) through that the quality of the audits achieves the set standard
statistics from the Information
Technology Department and the √ Determination of Issues to be Focused on during the Financial
response of the respondent (EAO) Statement Analysis
to the questions in the questionaire • The Tax Audit and Compliance System (TACS) can continue to
form at 11 IRBM branches. A list the items in the financial statement that need to be audited
review of sampling was also • The EAO is not required to analyse the financial statement
carried out at 3 branches, namely,
Kota Kinabalu, Miri and Sungai √ Review of KPI Setting
Petani, respectively representing • Not impeded or burdened by overly ambitious KPIs
a big, medium and small branch.

b) Effectiveness of Investigation

• Evaluation of the revenue collection
√ Criminal investigation to be conducted on specific
strategy by the Investigation Department,
Special Task Department, Intelligence cases that are identified and can give impact to other
Division, Investigation Branch and Special taxpayers (tax compliance pyramid model)
Task Unit √ Criminal investigations to be continued regionally and
• Re-evaluate the structure of the not at all investigation branches as is the current
Investigation Department after the
practice
execution of a full criminal investigation
at the Investigation Branch in 2013 √ Activate all civil investigations
• Identify the problems faced by the √ Civil investigations to be a source of information for
Investigation Department, Special criminal investigations
Task Department, Intelligence Division,
Investigation Branch and Special Task
Unit in order to achieve the set target for
revenue collection
c) Very Low Level of Compliance by the Small and Medium Enterprises (SMEs) Especially the Sole
Proprietors
• Determine the level of √ To improve compliance

compliance in relation to • Tighten enforcement action
the submission of income
• Have an ITRF that are easier to understand by simplifying the
tax return forms (ITRFs),
financial information section in Part H
keeping of comprehensive
business records and
• Intensify tax education and awareness amongst SME
declaration of accurate entrepreneurs
income/taxes
• Determine the level of √ To improve voluntary compliance
compliance in relation • Tighten enforcement action
to estimated tax instalment • Simplify the keeping of business records by limiting the
payments (CP500) and the requirement to only keep records such as listings and registers,
payable taxes reduce the period for keeping the records to 5 years, provide
• Identify the cause and incentives on the purchase of accounting software such
problem, as well as
as UBS, MYOB, SQL to encourage the use of systems so that the
the factor for low level of
keeping of business records is organised and systematic
compliance in the SME
sector
√ To improve compliance of estimated tax instalment payments
(CP500)
• Lengthen the period of payment and use the bank’s standing
instruction facility for deductions
• Give taxpayers the option to pay the instalment themselves or
through the bank’s standing instruction after receiving the
CP500 notice for estimated instalment schedule
• Fully enforce the penalty under subsection 107B(3) so that due
action is taken
41
d) Provision of Incentives and Exemptions under Section 127 of the Income Tax Act 1967
Objec tives Recommendations for Improvement
• Identify the ‘person’ to be given √ Thorough restructuring of the application process and
incentives and exemptions under procedures is required to ensure that only the persons
paragraph 127(3)(b) and subsection
who are truly eligible are given approval in line with
127(3A) of the Income Tax Act 1967
the objective of the introduction of the said subsection.
• Identify the effect of giving incentives
At the same time this could prevent interested ‘persons’
and exemptions on revenue collection from manipulating subsection 127(3A) if they fail to
obtain approval under paragraph 127(3)(b).
• Recommend improvement actions to
process owners to ensure the √ Suggest that the Tax Policy Department review and
effectiveness of giving or claim for issue a standardised format to the Tax Analysis Division
incentives and exemptions under of the Ministry of Finance
Section 127 of the Income Tax Act 1967
√ Have a specific exemption code in the ITRF C
√ Determine the exemption code for ITRF B/BE

ACHIEVEMENT
OF KPIs OF
STRATEGIC
OBJECTIVE #3
WIDEN THE TAX BASE
As the agency given the responsibility by the government to administer the country’s direct taxes, it is important
for the IRBM to ensure that the level of awareness of taxes is improved from time to time. The effectiveness of
voluntary tax compliance can reduce the arrears in revenue and ensure a steady revenue for the country’s
development. The IRBM also plays the role of widening the country’s tax base to ensure that every taxpayer
qualified to be taxed is caught by the tax net. Many activities were carried out throughout 2015 to achieve this
objective.
Hasil Friendly Visit
This is a specific activity for detection carried out by the IRBM as one of the initiatives to enhance revenue
collection and widen the tax base. At the same time, it encourages voluntary compliance amongst taxpayers
to pay the appropriate taxes.
The compliance activities carried out during a visit covers the following:
i. Delivery of notice of demand for tax arrears

ii. Delivery of final income tax return form notice
iii. Business census covering advisory services in respect of compliance with MTD as the final tax
iv. Opening of customer service counters for areas of operation situated more than 25 km away from the office
of the IRBM
Before a visit is carried out, the process to identify the taxpayers who will be visited needs to be done to ensure
the effectiveness of the visit. Amongst the criteria to be considered are as follows:
• Low level of compliance in terms of form submission and payment of taxes
• High level of compliance for the purpose of showing appreciation
• Identification of potential businesses to be registered
To ensure continuous impact is felt by society generally and taxpayers specifically, from the compliance activities
conducted by the IRBM, the Friendly Visit programme is periodically implemented at various implementation
levels, including at national, state and IRBM branch levels.
The use of the Mobile Information System (MIS) during programme implementation is a new, more strategic
approach. It facilitates officers verifying the taxpayers’ information during the visit.
43
Ths MIS is an application which allows the officers to access taxpayers’ information online in a secure manner
while on duty outside of the office by use of a mobile device. Beginning from 2015, this system was equipped
with a geographical information system application which enabled the exact location of the taxpayer to be
determined. Census information could then be entered into the data storage on a real time basis using this
system.
The use of the MIS aids officers in obtaining taxpayers’ information at any time and any location, while also
allowing access to the IRBM’s internal systems such as VIS, ETP, CAM and the external information source
checking system (SSM, JPJ, SMUP and others). The facility to access taxpayers’ information while in the field gives
an advantage to the officers while dealing with the public as they could profile them accurately. Appropriate
action could be taken based on the profile.
Business Census
Business census is a compliance activity carried out during a friendly visit. It is conducted by visiting business
premises including new business locations using a friendly approach to increase the level of compliance and
widen the tax base. At the same time, clear explanation is given to the taxpayers on their responsibility to pay
income tax to ensure that the government has sufficient funds to finance developmental programme initiatives
Business Census Performance
No. of Premises New Files Non-Compliance Non-Compliance Cases Referred

Year
Visited Registered of Form E/BN of MTD to Field Audit
2014 22,775 2,962 11 30 217

2015 20,750 991 74 86 131
Collection of Information through the Detection Unit Information System (SMUP) and Various Input
Screen (VIS)
The collection of information through SMUP and VIS is actively implemented by identifying sources of new
information that adds value to the actual objectives of the activity. In 2014, e-SMUP, the process by which
agencies coud fully deliver information electronically (online) was introduced for the purpose of improving
and expediting certain main processes within SMUP, and also to widen the tax base. Any high risk information
channelled by the e-SMUP during data validation process would be acted upon immediately. The system also
enabled the information from SMUP, VIS and STAMPS to be processed for the purpose of new registrations and
audit follow-up action. The system systematically distributes cases to detection officers. New file registrations
are based on the information from SMUP, VIS, STAMPS and FORIN. The information from FORIN on expatriates is
received from the Malaysian Immigration Department on a monthly basis and entered into the FORIN Information
System for file registration.
Economic Zone
Beginning in 2015, the Geographical Information System was used for the purpose of mapping the economic
zones. This application enables the location of taxpayers to be located on the map of Malaysia. The basic
information of the taxpayers, such as balance of taxes and type of business, is also displayed on the said map
This basic information enabled the IRBM to develop strategic plans for carrying out compliance activities such
as business censuses, audits and investigations.

To enable this application to fully function requires prior mapping of the branch locations. The mapping should
also focus on activities considered as underground economy. The main mapping locations given priority include:
i. Type/Sector of business industry

ii. Specific business industry with high risk of tax evasion and low levels of compliance
iii. Business industry with potential
iv. Existing special industry / well known in any one location
Decentralisation of Large and High Profile Taxpayer Files
Presently all income tax files for all categoris of taxpayers at all IRBM branches are administered by branches
in accordance with the residential address of the individual or the correspondence address in the case of
taxpayers other than individuals, without considering the size of the taxpayer.
Under the existing procedures, the branches in the Klang Valley handle company files with earnings of RM5
million and below whereas branches outside the Klang Valley do not take into account the company earnings.
On 18 November 2014, at its meeting no. 11/2014, the Personnel Committee II approved the setting up of the
Large and High Profile Taxpayer Unit. The establishment of this unit involved the taxpayers at the Corporate Tax
Department, the Multinational Tax Department, the Petroleum Division and IRBM branches. For the purpose of
decentralisation of the large and high profile taxpayers, a rebranding exercise and change of nomenclature
was carried out on the department and the divisions involved, effective from January 2015, as follows:
i. the Corporate Tax Department was changed to Large Taxpayer Branch (LTB)
ii. the Multinational Tax Department was changed to Multinational Tax Branch (MTB)
iii. the Petroleum Division was changed to Petroleum Branch (PB)
The LTB will handle large and high profile taxpayers’ files in Peninsular Malaysia, whereas large and high profile
taxpayers’ files in Sabah and Sarawak are handled by the Kota Kinabalu and Kuching branches under the Large
Taxpayer Unit at their respective branches.
The purpose of decentralisation is to ensure that specific focus is placed on high earning companies and
individuals who are the main contributors to the revenue collection. The LTB would focus on the files of large and
high profile taxpayers as well as files for the special sector. Larger companies and high profile individuals on the
other had need to be monitored continuously and systematically so that tax collection from them can be more
effectively implemented
Widening of the Tax Base through Tax Education
A strategy to widen the tax base is important to ensure a continuous and steady stream of revenue collection.
Therefore, the IRBM has taken steps to improve awareness of tax through intensifying tax education as well
as enhancing the sharing of information through collaborative networks with other agencies. The IRBM’s tax
education programmes utilise various approaches and mediums appropriate and effective in providing
understanding of taxation laws that are easily comprehended by individuals, companies, tax agents, employers
and future taxpayers. They are improved from time to time to raise voluntary tax compliance.
45
Taxation Seminars
(a) National Taxation Seminar

This taxation seminar is a yearly activity organised to disseminate the latest information in relation to
changes in taxation laws. Participation is open to tax practitioners, company owners, professional bodies,
employers and the public. In 2015, the IRBM conducted the National Taxation Seminar at 24 selected
locations nationwide.
Total Number
of Participants
6,634
(b) Taxation Seminars through Collaboration
The IRBM also conducts seminars in collaboration with professional bodies and associations such as the
Annual Budget Seminar-CTIM / Annual Budget Seminar – MATA / IRBM-MEF Seminar / IRBM/CTIM Tax
Forum.
In 2015, the IRBM conducted tax seminars by collaboration at 37 selected locations nationwide.
Total Number
of Participants
6,261
Taxation Briefings, Workshops and Lectures
As a move towards assisting taxpayers and the public to obtain accurate taxation information easily and
speedily, the IRBM continuously implemented tax education programmes. Through briefings, workshops and
lectures on taxation. These programmes were conducted free at all IRBM branches and taxpayers’ premises by
experienced IRBM officers. Amongst the topics delivered were Responsibilities of Taxpayers (Resident Individuals),
Responsibilities of Taxpayers (Non-resident Individuals), Responsibilities of Employers, MTD as Final Tax, Preparations
for Retirement, Promotion of ezHASil Services (e-Filing, TAeF, ByrHASiL, e-PCB, e-Data PCB, STAMPS, etc), Audit,
RPGT, Withholding Tax, Cooperatives and other briefings related to tax education and awareness.
Briefings, Workshops & Lectures 2,472

Participants 98,901
Hasil Relations Officers (HROs)
Recognising the importance of information sharing and continuous updating of requirements with employers,
the IRBM offers an officer for every employer by nominating/appointing a representative known as an HRO. The
role of the HRO is important to maintain the cooperation and identify the current issues faced by employers and
employees to be resolved together.

HROs for employers, the government sector, private sector and associations having a large number of employees
serve as an intermediary for employees to channel information, carry out their duties as taxpayers and improve
understanding of taxation through specific programmes.
Total Number
of HROs
2,409
Business Support Services (BSS)
The IRBM’s BSS programme offers free advisory services to small and medium business owners and new business
owners who are not represented by tax agents. One-to-one consultations, or group consultations for no more
than 10 participants are encouraged so that the programme would have a positive and lasting impact. The
modules educate on matters relating to business record-keeping, preparation of simple business accounts,
correct usage of business codes as well as calculation and payment of taxes. The taxpayer who runs his own
business / is a partner in a partnership can obtain these services by visiting a nearby IRBM branch
BSS Workshops 730

Participants 3,906
HASil4U Programme
Contents of the HASiL4U programme include:
(a) Campaign for Submission of Income Tax Return Form for Year of Assessment 2015
The campaign for the electronic submission of the income tax return form for year of assessment 2015
through e-Filing or m-Filing (smartphone application)
The campaign and continuous promotion which started from 1 March until 30 April for the BE Form and
1 June untul 30 June 2015 for the B Form were conducted at the IRBM branches or premises of agents
through requests from the Corporate Services Department / State Director’s Office.
HASiL4U Counters 319

Visitors 21,612
(b) Exhibitions and Expos

The IRBM set up its information counters at trade expos, exhibitions and other events organised by the
government, statutory bodies as well as private companies, to promote the use of its electronic services.
Amongst the expos that it participated in throughout 2015 were Mobile CTC / HR Open Day / ASEAN SME
Conference / National Tax Conference..
47
(c) Urban Transformation Centres
The HASiL4U programme was intensified by the participation of agencies at the Urban Transformation
Centres (UTCs). The establishment of UTCs was prompted by the National Blue Ocean Strategy (NBOS6)
and became a hallmark of the government’s best service to the public, specifically urban dwellers. Until
31 December 2015, 7 IRBM Branches had been opened at UTCs, namely:
i. Melaka UTC IRBM Branch
ii. Kuala Lumpur UTC IRBM Branch
iii. Perak UTC IRBM Branch
iv. Pahang UTC IRBM Branch
v. Kedah UTC IRBM Branch
vi. Sabah UTC IRBM Branch
vii. Johor UTC IRBM Branch
Number of
Visitors
57,664
Scope of service of the UTC IRBM branch is limited to assessment / collection / ezHASiL electronic services and
tax advisory services which do not require review of physical files.
Kidzania Tax Office
KidZania is an education and entertainment theme park that provides an opportunity for children to experience
real life role play, in more than 60 industries and service sectors. The IRBM, an agency under the Ministry of
Finance, is the first government agency in Malaysia to become an official partner of KidZania Kuala Lumpur.
The IRBM established its branch known as the KidZania Tax Office (KTO) which officially welcomed visitors on 14
September 2013.
The smart partnership between KidZania Kuala Lumpur and the IRBM enables children to role play as assessment
tax officers known as Junior Tax Officers work work in the KTO.
Through this approach, children, who are the future generation, are better able to understand the importance
of taxes to a country’s development and also how collected taxes are spent. This programme instils awareness
in the younger generation to become responsible citizens of the country.
Number of
Visitors
15,364
Visits to the IRBM
Visits to the IRBM headquarters and branches by students of institutes of higher learning and external agencies
are a continuous tax education activity that was conducted throughout 2015. During the visits, there were
lectures introducing the IRBM and tax awareness, briefing on careers at the IRBM and visits to service counters.

Additional activities, where suitable, such as the HASiL quiz, were also incorporated specifically for future
taxpayers from institutes of higher learning to reinforce understanding of the information provided during the
briefing on tax awareness.
Love Malaysia Campaign
The 2015/2016 Love Malaysia Campaign was held from March 2015 until February 2016. It sought to inculcate
the love for Malaysia as well as impart the importance of taxation amongst the younger generation made up of
students in schools, public universities and other institutes of higher learning in 19 locations throughout Malaysia.
Datuk Aznil bin Haji Nawawi who was appointed as the Love Malaysia Campaign icon used his influence to
bridge the gap between the IRBM and local celebrities and to portray the IRBM from a more positive angle. As
a result, local celebrities have begun to contact the IRBM for assistance in carrying out their responsibilities to
the country.
Datuk Aznil is a creative spokesperson with audiences from a variety of age groups and backgrounds. The
briefings given at every location were different and tailored to the audience.
Total Number
of Participants
15,580
IRBM Publications
In 2015, the IRBM published several tax education materials. Amongst them were:
• 22 tax pamphlets in Malay and English which were distributed to taxpayers and the public at service counters
at all the IRBM branches
• Tax posters in Malay and English which were distributed to the IRBM branches nationwide to be displayed at
their service counters for the purpose of disseminating information to the taxpayers and the general public
• Guidebook for business owners entitled “I am a Responsible Business Owner”
• Tax education flyers for taxpayers and the general public suited to the time and service needs throughout the
year
• HASiL News, the IRBM’s official newsletter for internal distribution and also external agencies, issued three (3)
times a year and incorporates the activities throughout the year
These published materials may be accessed and downloaded from the IRBM’s official portal
without charge.
49
ACHIEVEMENT
OF KPIs OF
STRATEGIC
OBJECTIVE #4
MODERNISE THE WORK SYSTEM AND PROCEDURES IN LINE WITH CURRENT NEEDS
An Efficient and Effective Work System and Procedures
The IRBM is always improving its service standard to ensure the effectiveness and efficiency of its service
performance for customers. This is in line with its strategy to develop and strengthen its information and
communication technology system, improve its cost efficiency and cost effectiveness, enhance its work
procedures and inculcate risk management within the same.
The level of compliance can be improved with access to information that is fast, accurate and available at
any time. The applications of the taxation system are strengthened so that they can be accessed from any
location using mobile electronic devices. The use of data analysis equipment and the addition of automation
functions can improve existing work procedures. This contributes to the effectivess of internal costs through
strategic distribution of resources.
The IRBM is committed to providing quality and transparent services, suited to current demands. The widespread
and innovative use of its information technology system is a catalayst to its delivery of service. The IRBM targets
an increase in online services leading up to 2020, aligned with the use of the internet as the primary service
delivery channel. The addition of comprehensive and automated self-service networks saves transaction time
for taxpayers and the IRBM, consequently reducing the cost of compliance.
The security of the information system and facility is critical in ensuring the confidentiality of taxpayers’ information.
Hence, the IRBM consistently takes the appropriate precautions to protect the information system and facility
from any security threats and information leakage.

ezHASiL
The IRBM has introduced electronic services in line with the implementation of the latest delivery systems
advocated by the government (e-Government). Many innovations and improvements in electronic services
have been offered to customers. At the IRBM, these services are known as ezHASiL, and they help generate
increased revenue collection. Apart from that, ezHASiL, which is accessed online, makes it easier for employers
and employees to deal with the IRBM while making a positive impact on all parties in terms of the use of resources,
cost, time, work space and others. The different services available in ezHASiL are shown above.
51
ezHASiL Performance
Number of Transactions
Service
2015 2014
e-Bayaran 152,172 99,264
STAMPS 2,529,044 2,107,803
e-PCB 85,701 46,895
e-Data PCB 25,484 20,171
e-Kemaskini 61,834 14,831
e-SPC 1,377 1,013
e-LEJAR 73,151 150,762
e-Daftar
e-Daftar is an application for registration of income tax file that can be used by new taxpayers to obtain a tax
reference number. An application for e-Daftar will be cancelled if complete documents (uploaded) are not
received within fourteen (14) days of the date of application, and the applicant shall have to submit a new
application with complete documents.
e-Daftar Performance
Individual Company Employer

Applications successfully registered 97,628 48,436 28,539
e-Lejar
e-Lejar is a facility for users of e-Filing to review personal particulars, ledger transactions and the current tax
balance. It can be accessed through the e-Lejar icon on the main web page of the IRBM at http://www.hasil.
gov.my or at https://elejar.hasil.gov.my
e-LEJAR
Visitors
600,100
e-Filing
e-Filing and m-Filing are FREE applications provided by the IRBM to help taxpayers to complete and submit the
income tax return form via the internet. This service enables individuals, companies, employers and others to
fill in, sign digitally, and submit the form online. The submission of forms E, BE, B, BT, P, M, MT and TF for year of
assessment 2015 via e-Filing commenced on 1 March 2016.
The taxpayer can also submit Form BE using mobile devices such as smartphones and tablets using the Mobile
Filing (m-Filing) application. This application can be directly accessed through the IRBM’s official portal at www.
hasil.gov.my.

e-Filing Performance
Type of Form 2015 (YA 2014) 2014 (YA 2013)
e-BE 2,390,146 2,272,101
e-B 532,083 503,227
e-C 281,151 202,337
e-M 21,733 20,134
e-P 83,311 76,116
e-E 166,934 82,249
e-R 100,382 171,526
Total 3,575,740 3,327,690
The types of income tax return form submitted via e-Filing:
Form B (e-B) Business income
Form BT (e-BT) Resident individual (knowledge/expert worker)
Form BE (e-BE) Income not from business source
Form P (e-P) Partnership
Form M (e-M) Non-resident individual
Form MT (e-MT) Non-resident individual (knowledge worker)
Form E (e-E) Employer
Form C (e-C) Company
Form R (e-R) Statement 108 for company
e-Anggaran (e-CP204) Estimated tax payable for company/cooperative/trust body
ByrHASiL
The IRBM was listed as one of the organisations involved in MAMPU’s Action Plan for the Enhancement of
e-Bayaran Programme, and introduced the electronic payment service through ByrHASiL. This method of
payment is in line with current technology and can improve the country’s revenue collection more efficiently by
reducing the dependence on manual payments at IRBM counters. The service can be accessed through the
IRBM’s portal. Amongst the services offered is payment through debiting of account which requires taxpayers to
have access to internet banking with FPX member banks, namely, CIMB, Hong Leong Bank Berhad, Bank Islam
Malaysia Berhad, Maybank, Public Bank Berhad and RHB Bank Berhad.
Aside from that, payment can be made by credit card online. Holders of Visa, MasterCard and American
Express issued in the country may use this service.
53
Strengthening of IRBM’s Service Delivery System
The IRBM is always improving its service delivery to facilitate taxpayers who carry out their tax obligations
diligently. Providing the best services to customers has helped the IRBM to increase voluntary compliance. In this
connection, a study on service delivery integrity was conducted throughout 2015.
The main objective of the integrity study was to review the implementation of work processes and procedures
to further improve the IRBM’s service delivery by ensuring that the work processes and procedures were relevant
to the current requirements. The Study on Tax Collection Performance was one of the activities in the integrity
study carried out in 2015. Recommendations for improvement were also incorporated as feedback to boost the
quality of the IRBM’s service delivery in the future.
Study on the Tax Collection Performance
Objectives of Study:
• To review and assess the submission of income tax return forms by large companies and the incentives /
exemptions claimed
• To review and assess compliance of the tax instalments (CP204 / CP204A) and the actual tax paid by the
taxpayers, especially larger companies
• To identify the causes and problems faced, as well as factors influencing collection especially from larger
companies, and recommendations for improvement
Recommendations for Improvement:
• The directive in relation to CP 204 tax estimation needs to be reviewed and simplified to make it easier for the
officer handling the same as well as for the taxpayer to comply with.
• More effective monitoring whereby each division / unit in the Corporate Tax Department is required to
monitor companies showing a downward trend in collection so that early intervention could be made and
be considered as a criteria for audit.
• At the department level, the Revenue Collection Department could monitor the difference between the
amended CP 204 tax estimation and the decreasing CP 204 tax estimation, and red-flag the differential
amount (as an example, a minimum downward difference of 50% from the original estimation) as an indicator
for audit action.
• To ensure that there are no arrears or excessive refunds, the sufficient number and competence of officers
at the Customer Service Centres to handle CP 204 cases from all branches need attention, in view that the
monitoring of payment of CP 204 estimation is the responsibility of the centres.
• A study conducted to reduce the number of payment codes so that the time spent by assessors to calculate
increases and correct the same manually could be reduced. This could also make it easier for taxpayers and
reduce confusion.
• An increase imposed on any payment could be reviewed to facilitate implementation by taxpayers and
officers.

• An increase in positions in the Legal Unit of the Corporate Tax Department could be considered to enable
immediate handling of case backlog. In the short term, temporary officers could be hired to ease the process
of clearing outstanding work.
• The IRBM needs to intensify and diversify the awareness and tax education programmes, specifically for
the corporate sector. Continuous programmes is important so that society is aware of the need for their tax
contributions.
A report on the studies was presented to the upper management, process owners, state directors and branch /
Investigation Branch (Klang Valley) directors at a special briefing session on 26 October 2015.
IRBM’s Initiatives
Each initiative developed embodies the IRBM’s commitment to provide a conducive work environment based
on the concept of feel good at work. In line with the IRBM’s status as a self-financing agency, the effectiveness
of every planned initiative is a priority to ensure that it is in line with current requirements. Amongst the initiatives
developed by the IRBM in 2015 are:
Rebranding
Initiatives Implications to the Organisation
• Empowering administrative • Creates an excellent work culture

management, amongst other things, through healty competition
through the creation of the • Improves the efficiency of governance
Administration Unit Excellence Award
• Community cohesiveness
• Enhancing the sense of belonging • Visits to PPN / HR4U
within the organisation: • Prihatin Squad
POS (People Outreach and Support) • Esprit de Hasil
- Engage with people, not employees
(people first) • Embraces the core values and develops
the Hasilian work culture and identity
• Corporate image
- Elevating the Hasil identity
(core values)
55
Strategic HR
Recruitment • Attracts talents with potential

• Strengthening recruitment through • Reduces probation period
e-recruitment / e-job apply • Reduces training costs
• Green harvesting
• Head hunter
Job creation 3Rs (the right person in the right place at

• job description / job specification – the right time
person match
• Workforce planning
• Reinforcing the Individual Development • A more organised training plan

Plan (IDP) • More systematic management of the
• Human Management System training budget
• Talent Management System • Officers can plan their own training
• TNA requirements
Performance management • Gives priority to more regular

• Strengthening the Online Performance performance evaluation (3 times a
• Strengthening the Performance year)
Improvement Programme (PIP) • Improves the performance of officers
Establishing a career progression path for • Provides a career progression path that
officers is attractive to IRBM officers
• Promotions for officers are implemented
based on competence and career
progression
• Develops officers who are multi-skilled
and experts
• The officers recruited fit the IRBM’s
requirements
• Provides experts in accordance with
the task / service requirements
• Elevates experts as consultants
Establishing a succession plan • Ensures the retention of expertise within

- CEO Incubator Programme the IRBM
• The potential and suitability of an officer
are identified through a comprehensive
career progression plan that fulfils the
job expectation and objectives of the
organisation

• The Talent Development Programme
improves the competence of officers
holding critical positions in the IRBM
Strengthening the IRBM Service Scheme • The officers recruited fit the IRBM’s
requirements
• Offers a service scheme that is attractive
and contributes to the improvement of
the IRBM’s KPIs
Instituting Lean Organisation • An optimum manpower situation

• Improves the efficiency of the human
resource management
• Reduces human resource wastage
• Shortens work processes and improves
efficiency
- Employee engagement • Gives accurate information and informs

- HR4U the IRBM officers of the organisation’s
- Networking objectives
- RSOG • Heightens cooperation between
- Maybank agencies / the private sector for the
- EPF purpose of improvement
Work Life Balance
• Expanding the implementation of the • Saves cost

Work from Home system • Contented officers which lead to an
• SOHO (Flexi Office) – Allowing work to improvement in productivity
be done at any nearby offices • Saves office space by expanding
shared spaces
57
ACHIEVEMENT
OF KPIs OF
STRATEGIC
OBJECTIVE #5
DEVELOP HUMAN CAPITAL OF INTEGRITY WHO ARE COMPETENT, PROFESSIONAL AND
DEDICATED
The Malaysian Tax Academy as a Prestigious Training Centre
The Malaysian Tax Academy (MTA) is a training institution entrusted with the training of IRBM officers to enable
them to carry out their tasks professionally and competently. It is also responsible for the implementation of quality
training programmes suited to current requirements so that a continuous learning culture is inculcated amongst
IRBM officers. Aside from that, the MTA is also responsible for training officers to become more knowledgeable,
high-achieving, multi-skilled, principled, creative and innovative. .
The MTA’s quality policy underlines the IRBM’s efforts to make its human resources excellent and principled
through effective training. The training programmes are constantly improved to fulfil the needs of the customers,
in line with the requirements of the MS ISO 9001:2008 Quality Management System.
In 2015, the MTA succeeded in conducting 240 (97.00%) of the 248 courses planned. This total did not include
ad-hoc courses and courses organised by external parties. This achievement exceeded the quality objective
target which prescribed that at least 85% of the courses scheduled in the Annual Training Programme Book
should be implemented
Performance in Implementation of Training Programmes

No. of Training
No. of Officers No. of Training Percentage of Quality Objective
Year Sessions
Trained Sessions Planned Achievement (%) Target (%)
Implemented
2014 10,043 277 243 87.70 85
2015 9,280 248 240 97.00 85
IRBM e-Learning System
The MTA developed a new e-Pembelajaran application known as the IRBM e-Learning System to replace the
existing system known as the Multimedia Learning System (MMLS). The MMLS had been an online learning
medium since 2003. The IRBM e-Learning System was jointly developed with a supplier (KHR Alliance Sdn Bhd),
the Information Technology Department and the MTA.

It was first used on 5 February 2013 where the module on assessment was used by the ICT training centre for
participants of the KAP 41 No. 2/2013 course. By 2015, the use of the e-learning application was more widespread.
Amongst the courses using this application were the Service Foundation Course for the Ministry of Finance,
Revenue Collection Department, Legal Department and training centres in the MTA.
Courses Using the IRBM e-Learning Application
Training Centre e-Learning Course

Finance Department / Revenue Collection Department 47
Legal Department 29
Accounts and Audit Training Centre 1
ICT Training and Development Centre 2
Management Training Centre 1
Legal Training Centre 1
Joint Venture Study Programme
The MTA continued to have various smart joint ventures with external organisations throughout 2015. The main
objective of these joint ventures was to improve the level of knowledge and professionalism of the IRBM officers.
A large number of highly educated officers will boost internal productivity and consequently elevate the image
of an organisation.
Knowledge is the main force in making the IRBM a world class tax administrator. IRBM personnel who have highly
knowledgeable are able to think from a global perspective yet employ a local approach in implementing the
tasks entrusted upon them.
The Centre for International Training, Research and Innovation is a training centre in the MTA. In line with the MTA’s
quality policy to improve the skills of its human resources through effective training, the centre is committed to
continuously develop the human capital through tax learning programmes as well as high quality and dynamic
international courses. The course is responsible for conducting joint venture study programmes with external
organisers, the Malaysian Technical Cooperation Programme and also tax learning studies.
The following are the courses and joint venture programmes between the centre and international organisers
such as the Commonwealth Association of Tax Administrators (CATA), the Organisation for Economic Cooperation
and Development (OECD), the International Bureau of Fiscal Documentation (IBFD) and the Japan International
Cooperation Agency (JICA).
59
No. Course
1. IRBM-OECD : Compliance by Design – Instruments to Strengthen Tax Compliance
2. IRBM-OECD : Tax Treaty Seminar on Taking Forward the BEPS Tax Treaty Related Issues
3. IRBM-IBFD : Anti-Money Laundering and Tax Evasion
4. IRBM-OECD : International Tax Avoidance and Countering BEPS
5. IRBM-CATA : Workshop on Taxation of International Transactions (TOIT)
6. IRBM-MTCP-JICA TCTP for CLM : Tax Administration Enforcement Activities
7. IRBM-OECD : Transfer Pricing Dispute Resolution and Avoidance (MAPs and APAs)
8. IRBM-OECD : Taking Advantage of the Mac and Automatic EOI
9. IRBM-MTCD : Introduction to the Application and Negotiation of Tax Treaties
10. BEPS Seminar 14-18 December 2015
11. IRBM-IBFD : Taxation of Financial Markets
12. IRBM-OECD : Taxation of High Net-Worth Individuals
No. Programme
1. IRBM-CTIM : National Tax Conference
2. IRBM-MOE : 2015 Tax Smart Camp
3. Leiden Malaysia Executive Programme in International Law (joint organisation between the
IRBM and International Tax Centre, Leiden University Netherlands
The Malaysian Technical Cooperation Programme (MTCP) organised by the Centre for International Training,
Research and Innovation is intended to provide a forum for the representatives of the countries involved and
IRBM officers to meet and share experiences and opinions, and debate on taxation issues. The MTCP course
conducted in 2015 was the IRBM-MTCP: General Tax Administration Course.
No. AD-HOC
Courses
1. Training on E-Governance and Change Management for Sri Lanka Inland Revenue Officers –
collaboration between the MTA and JPCA
2. Workshop on Strengthening Tasks, Responsibilities and Teamwork
3. Training on E-Governance and Change Management for Sri Lanka Inland Revenue Officers –
collaboration between the MTA and JPCA
4. Antara
MoU Leiden Malaysia
LHDNM Executive
- Universiti UtaraProgramme
Malaysia in International Tax Law (joint organisation between the
IRBM & International Tax Centre, Leiden University Netherlands)

The IRBM and Universiti Utara Malaysia (UUM) entered into a memorandum of understanding (MoU) to
strengthen, encourage and develop the cooperation between them. The MoU was executed by Tan Sri Dr
Mohd Shukor Haji Mahfar, Chief Executive Officer of the IRBM, and Professor Dato’ Wira Dr Mohamed Mustafa
Ishak, Deputy Chancellor of UUM, at the IRBM headquarters in Cyberjaya on 5 February 2015.
The MoU will be in force for a period of five years and forms the basis for the IRBM and UUM to develop an
academic cooperation specifically in the field of tax management. It is also provides latitude for both parties
to explore a wider cooperation for their mutual benefit.
The focus of cooperation for immediate implementation was the development of a joint venture programme
related to accounting and taxation to fulfil the industry’s need and for the sharing of facilities and expert
resources in the interest of research and education. The IRBM will also identify the scope of cooperation to
place its officers at UUM as an on-the job training ground as well as the exchange of expertise.
Apart from that, joint venture training initiatives undertaken by the MTA in 2015 are as follows:
i. Discussion between the IRBM / MTA – Royal Malaysian Customs Department and UUM
ii. Follow-up discussion between the IRBM / MTS – Melaka UiTM
iii. Goodwill visit by UKM officers to the Bangi MTA
iv. Discussion with the Malaysian Association of Tax Accountants (MATA)
Reinforcement of Work Culture through the Monitoring of Internal Controls
The IRBM, through its Inspectorate and Integrity Department, consistently monitors to ensure that adequate
internal controls are in place to protect the integrity of work processes in order to strengthen tax governance.
Amongst the programmes implemented for that purpose in 2015 were Monitoring of the Implementation of
IRBM’s Integrity Plan 2014-2018 (PIL 2.0), Value Auditing Management System (VAMS) and Corporate Integrity
Pledge.
Monitoring of the Implementation of IRBM’s Integrity Plan 2014-2018 (IIP 2.0)
The IRBM’s Integrity Plan 2014-2018, known as IIP 2.0, applies an action plan which contains 6 strategies
and 61 programmes / activities through 91 implementing agencies that are categorised as general
implementing agency or specific implementing agency.
Its implementation in 2014 was based on the observation of the scope of the Implementation Level
Analysis Programme / activities from strategy 1 to strategy 6 and the analysis of the implementing agency’s
achievement. The marking scheme for reporting was broken down according to segment based on 6 levels
of implementation and 4 achievement criteria. The implementing agency adapted the Self Evaluation
System to evaluate the development of a programme / activity that was carried out.
The results of the analysis showed that 60 out of 61 IIP programmes / activities
were successfully implemented in 2014, equivalent to an achievement of 98.36%,
whereas 65 implementing agencies were rated excellent.
61
IIP Programme / Activity implementation Performance
Not
Implemented
1.64%
Fairly Easy to
Implement
Easy to
1.64%
Implement
11.48%
Very Easy
to Implement
52 Programmes
85.25%
7 Programmes
1 Programme
1 Programme
IIP Implementating Agency Performance
Good
Weak
9.89%
6 6.59%
Agencies
9
Agencies
Very Good 11 Agencies

12.09%
Excellent
65
71.43%
Agencies
Note: Implementing agencies consisted of departments (including the Bangi MTA and Kuching MTA), divisions, State Director’s
Offices, branches and Investigation Branches.

Programme to Improve Officers’Professionalism
Professionalism amongst the IRBM officers is constantly a priority to protect the IRBM’s reputation as an excellent
tax administrator. The Programme to Improve Officers’ Professionalism was implemented throughout 2015
to develop officers of good character who are responsible for themseleves and to the organisation, as well
as to inculcate a culture of teamwork that is more positive and proactive. Aside from that, it also improved
the effectiveness of the organisation in the process of implementing and delivering a task. Six (6) forms of the
Programme to Improve Officers’ Professionalism were implemented in 2015:
i. Emotional Intelligence at the Workplace and Mesra Ukhuwah Course

ii. PSMB – Train the Trainer Course
iii. Management and Disposal of Files and Records
iv. Briefing on Public Sector Conducive Ecosystem (PSCE) for the IRBM’s PSCE coordinator
v. Course on Motivation and Personal Development for MTA Support Groups
vi. Course on Supervising Difficult Individuals
Integrity Awareness Programme
The Integrity Awareness Programme was consistently implemented throughout 2015. The main purpose of the
programme was to educate Hasilians to practise good values at all times in carrying out their daily tasks, apart
from avoiding any misconduct that could have negative effects on the organisation.
a) Integrity Message
Integrity messages in the form of posters issued by the Human Resource Management Department were
uploaded onto the IRBM’s Hasil portal for all Hasilians. The messages included:
- Debt Free, Peace of Mind

- Love Malaysia
- Respect Flexi Working Hours
- Let’s Declare Our Assets
- Misuse of ICT and Social Media
- Avoid Giving and Accepting Bribes
- No Clocking in or out for Another Officer
- Respect Your Working Hours
- Don’t Use External Influences
b) Briefing/Lecture on Integrity
Several briefings and lectures on integrity were conducted in 2015 for IRBMs’ officers and staff of various
backgrounds and positions
c) Value Audit Management System (VAMS)

The Value Audit Management System (VAMS) was implemented for the purposes of identifying the extent to
which good values were practised and improving the implementation of programmes relating to good values.
This was in line with Prime Minister’s Directive no. 1 of 1998, series 7 no. 1 of 2007: Move to Reinforce the Integrity of
the Government Administration Management System: Implementation of the Value Audit Management System
in Public Service.
Five (5) instruments were used to determine the level of practice, namely the Value Practice Record containing
information on asset declaration, disciplinary / surcharge action, public complaints bureau and annual
performance evaluation report, whereas the ideal value index, personal value index and organisation value
index employed the online survey method using the Public Service Department’s system. The exercise involved
432 IRBM officers from 12 State Director’s Offices. For customer feedback, the survey was distributed by the State
Director’s Offices at branches / Investigation Branches under their respective jurisdictions
63
The findings of the 2014 VAMS Audit showed the level of practice of values in the
IRBM was 88.09 and rated GOOD, namely “ACCEPTABLE WITH CONTINUED EFFORT
TO IMPROVE”.
Results of Value Audit
100
100 92.56
87.26 88.09
83.35
81.91
80
60
40
20
0
Value Ideal Personal Organisatinal Customer Composite
Practice Value Value Value Feedback Index
Index Index Index Index
Petunjuk :
≥ 90 Excellent
80-89 Good
60-79 Average
≤ 59 Weak

Corporate Integrity Pledge
As an agency that protects the public interest, it is important to

make society understand that the IRBM always gives fair and
transparent services to all levels of society. NO GIFT &
HOSPITALITY
In this connection, the no gift & hospitality policy was enforced POLICY
with immediate effect via the IRBM’s press statement on 10
July 2015. The implementation of this policy is one of the IRBM’s To uphold the highest level of
responsibilities to adhere to the principles of the corporate integrity INTEGRITY, the Inland Revenue Board
pledge signed by the CEO on 13 November 2013. The adoption of Malaysia (IRBM) hereby implements
of this policy is expected to support the IRBM’s intention that it be the no gift & hospitality policy effective
made known to the public that whatever form of gift or benefit or immediately.
hospitality would not influence any action on the part of the IRBM.
It is in line with the IRBM’s quality policy which states “founded Under this policy Hasilians are
on integrity, we are committed to providing the best service for PROHIBITED from
customers”.
• RECEIVING gifts if they are related
Apart from that, the whistleblowing policy was launched on 22 April to official duties, whether directly
2015 during the April 2015 Creative Showcase. The objective of this or indirectly.
policy is to enable the IRBM officers and Individuals (outside of the
IRBM) to expose any inappropriate behaviour of IRBM officers from • GIVING gifts if they are related
an early stage without fearing repercussions so that inappropriate to official duties, whether directly
behaviours may be identified and swift action taken. or indirectly.
This policy also ensures that IRBM officers and individuals (outside
of the IRBM) make the exposure of inappropriate behaviours in a
responsible and transparent manner. WE PROVIDE SERVICES
WITH A SMILE, WITHOUT
EXPECTATION OF ANY
REWARD
Evaluation of Tax Administration Diagnostic Assessment Tools (TADAT)
To promote an environment of strong internal controls for the purpose of emphasising a professional work culture
founded on integrity for its employees, in 2015, the IRBM conducted a TADAT (Tax Administration Diagnostic
Assessment Tools) evaluation on accountability and transparency which are the crux of good governance.
From the evaluation conducted, the IRBM achieved an excellent rating for the following dimensions:
i. Having a strong framework for external oversight that is independent of the operations of tax management
and its financial performance
ii. Having strong internal controls in the following aspects:
a. Adequate internal controls to protect the administration system from any mistakes or fraud
b. A level of assurance provided by the internal audit that reports are made functionally and directly to the IRBM
Board of Directors
c. A variety of mechanisms to ensure the integrity of IRBM staff
65
AWARDS &
RECOGNITION
LIST OF AWARDS
RECOGNITION RECEIVED IN 2015
VISIONARY LEADER OF THE YEAR AWARD
The IRBM Chief Executive Officer received the Highest Category of Personality
for Visionary Leader of the Year from McMillan Woods Global Awards
Date: 22 January 2015
LIFETIME ACHIEVEMENT AWARD
The IRBM Chief Executive Officer received the 2015 Lifetime Achievement Award from Leaders
International and American Leadership Development Association (ALDA).
Date: 05 March 2015
SOCIAL MEDIA EXCELLENCE AWARD
The IRBM received the 2015 Social Media Excellence Award in the category of Social Media
Engagement on the occasion of the 2015 World Bloggers and Social Media Awards.
Date: 24 April 2015
LIFETIME ACHIEVEMENT AWARD
CEO LHDNM dianugerahkan "2015 Lifetime Achievement Award -

Outstanding Contributions In Shaping People" daripada The Asia HRD Awards 2015.
Date: 08 June 2015

GLOBAL BEST BRANDS WORLD CLASS INCOME TAX AGENCY AWARD
The IRBM was awarded the 2015 Global Best Brands World Class Income Tax Agency -
GLC Category by the Global Brands Council & Leaders International.
Date: 08 June 2015
GLOBAL FINANCIAL BRAND ICON OF THE YEAR AWARD
The IRBM Chief Executive Officer was awarded the 2015 Global Financial Brand Icon of
the Year – Masterclass Category by the Global Brands Council & Leaders International.
Date: 08 June 2015
THE EUROPEAN EMERGING MARKET AWARD
The IRBM received the 2015 European Emerging Market Awards in the category of
Public Financial Institution of the Year – Asia.
An article on the IRBM and an advertisement were published in September –

October 2015 issue of The European magazine.
Date: September 2015
THE EUROPEAN EMERGING MARKET AWARD
The IRBM Chief Executive Officer received the 2015 European Emerging Market Award
in the category of Public CEO of the Year – Asia from The European which operates in
London.
Date: September 2015
HR EXCELLENCE AWARDS
The IRBM was shortlisted as a finalist in the 2015 HR Excellence Award in two categories,
namely:
1. Excellence in Training, Learning and Development Programmes

2. Excelellence in Employee Development
The HR Excellence Awards are given by the Human Resources Magazine published by
Lighthouse Independent Media that is based in Singapore. The IRBM was also named
the Silver Winner in the Excellence in Employee Development category
Date: 17 September 2015
67
ASOCIO AWARD
The 2015 ASOCIO (Asian-Oceanian Computing Industry Organisation) Awards

Category – Digital Government
Project – IT Innovation
Date: 6 October 2015
BRONZE ILLUMINATION AWARD
The Ocean 10 ICC Team from the Cheras Ocean 10 Branch received the Bronze Illumination
in the Competition category at the 2015 International Convention on Quality Control Circles
(ICQCC) which took place at the Changwoon Exhibition & Convention Centre, Gyeongnam,
South Korea
Date: 7 October 2015
HR ASIA BEST COMPANIES TO WORK FOR IN ASIA AWARD
The IRBM received the 2015 HR Asia Best Companies to Work For in Asia award together with
37 other organisations. This award programme was organised by HR Asia, one of the leading
publications in Asia for professional human resource practitioners, with the objective of giving
recognition to organisations deemed amongst the best in Asia.
Date: 13 November 2015
MASTERCLASS CEO OF THE YEAR AWARD
The IRBM Chief Executive Officer was named the Masterclass CEO of the Year (GLC category)
by the Malay Chamber of Commerce of Malaysia – Selangor in collaboration with The Leaders
Magazine at the prestigious Selangor Business Awards in the Concorde Hotel, Shah Alam.

MASTERCLASS VISIONARY LEADER OF THE YEAR AWARD
The IRBM Chief Executive Officer was named the Masterclass Visionary Leader of the Year
at the 6th Middle East Business Leaders Awards organised by the Leaders International and
American Leadership Development Association (ALDA).
41st MINISTRY OF FINANCE SPORTS CARNIVAL
The IRBM contingent achieved 2nd place at the 41st Ministry of Finance Sports Carnival. Two
extraordinary Hasilians were crowned the Sportsman and Sportswoman of the carnival:
- Mr Jegan s/o Arumugam (athlete)
- Miss Rahilah Othman (athlete)
Date: 27 November 2015 - 6 Disember 2015
HONORARY DOCTORATE IN MANAGEMENT
The IRBM Chief Executive Officer was awarded an Honorary Doctorate in Management in
conjunction with the 2015 convocation ceremony of the Asia Metropolitan University.
Date: 16 December 2015
RUNNER UP IN THE FINALS OF THE NATIONAL DIKIR BARAT COMPETITION
The IRBM’s Sri Lubalang Hasil group emerged as the runner-up in the finals of the 2015 National
Dikir Barat Competition which was held at the Sultan Haji Ahmad Shah Broadcasting Complex
in Kuantan.
Date: 20 December 2015
69
NATIONAL
HIGHER
EDUCATION
FUND
CORPORATION
IRBM as the PTPTN Loan Collection Agent
The IRBM was appointed as the collection agent for the National Higher Education Fund (PTPTN) loans pursuant
to section 25 of the National Higher Education Fund Act 1997 (Act 566). On the whole, the total PTPTN loan
repayment collection had been increasing each year as a result of the increase in the number of borrowers
making voluntary repayments to the IRBM. Starting 1 November 2015, the IRBM is no longer a collection agent
for PTPTN. All employers who implement salary deductions for the repayment of the loans should remit the funds
directly to PTPTN.
PTPTN Collection Performance
2015 2014
RM107.45 RM147.21
million million
Number of Payers Number of Payers
50,709 62,937

1MALAYSIA
PEOPLE’S AID
(BR1M)
The 1Malaysia People’s Aid (BR1M) programme was announced by the
Prime Minister for the fourth consecutive year during the tabling of the 2015 Statistics of
Supply Bill on 10 October 2014. BR1M Approval in
Accordance with
The programme is led by the Ministry of Finance. The IRBM, as the
implementing agency, was responsible for the registration and processing Eligible Quantum
of 8.2 million applications. The registration for BR1M began on 1 December
2014 until 31 January 2015, and the period for acceptance of appeals was
form 1 March until 15 May 2015 RM950
4,169,839
Three categories of application were eligible for the 2015 BR1M
a) Heads of household or senior citizens eligible for RM950 where the gross RM750
monthly household income was RM3,000 or less; 410,725
b) Heads of household or senior citizens eligible for RM750 where the gross
monthly household income was between RM3,001 and RM4,000;
RM350
c) Single unmarried individuals (including single parents / widows / 2,708,553
widowers) without dependants aged 21 years and above with a gross
montly income of RM2,000 and below eligible for RM350
2015 BR1M Statistics
Total Approved
Applications Applications
Unsuccesful
8,263,161 7,289,117
Applications
974,044
71
ALOR SETAR BRANCH
SUNGAI PETANI BRANCH KOTA BHARU BRANCH
KULIM RSC TANAH MERAH RSC
LANGKAWI RSC KUALA KRAI RSC
KUBANG PASU RSC KANGAR BRANCH
YAN RSC
BALING RSC KUANTAN BRANCH
KEDAH UTC RAUB BRANCH
TEMERLOH BRANCH
BENTONG RSC
PENANG BRANCH JERANTUT RSC
BUKIT MERTAJAM BRANCH PAHANG UTC
SEBERANG PERAI RSC
KUALA TERENGGANU BRANCH

IPOH BRANCH KEMAMAN RSC
TELUK INTAN BRANCH BESUT RSC
TAIPING BRANCH DUNGUN RSC
MANJUNG RSC HULU TERENGGANU RSC
KUALA KANGSAR RSC
PARIT BUNTAR RSC
PERAK UTC
IRBM HEADQUARTERS, CYBERJAYA

MALAYSIAN TAX ACADEMY
IPC
SHAH ALAM BRANCH
KLANG BRANCH
ULU LANGAT RSC
CYBERJAYA RSC
RAWANG (GOMBAK) RSC
KUALA LANGAT RSC
KUALA SELANGOR RSC
CUSTOMER SERVICE CENTRE
DUTA BRANCH
KUALA LUMPUR COLLECTION BRANCH
SEREMBAN BRANCH
NON-RESIDENT BRANCH
TAMPIN RSC
KUALA LUMPUR BANDAR BRANCH
KUALA PILAH RSC
CHERAS BRANCH
WANGSA MAJU BRANCH
KUALA LUMPUR UTC
KUALA LUMPUR PAYMENT CENTRE
LTB JOHOR BAHRU BRANCH
KLUANG BRANCH
MUAR BRANCH
BATU PAHAT RSC
MELAKA BRANCH SEGAMAT RSC
JASIN RSC KOTA TINGGI RSC
ALOR GAJAH RSC MERSING RSC
MELAKA UTC PONTIAN RSC
JOHOR UTC

IRBM
DIRECTORY KOTA KINABALU BRANCH
KENINGAU BRANCH
TAWAU BRANCH
SANDAKAN BRANCH
KUDAT RSC
LAHAD DATU RSC
SABAH UTC
KUCHING MALAYSIAN TAX ACADEMY

KUCHING CUSTOMER SERVICE CENTRE
KUCHING BRANCH
MIRI BRANCH
BINTULU BRANCH
SIBU BRANCH LABUAN BRANCH
LIMBANG RSC
MUKAH RSC
SRI AMAN RSC
SARIKEI STAMP CENTRE
LAWAS STAMP CENTRE
RSC: REVENUE SERVICE CENTRE

UTC: URBAN TRANSFORMATION CENTRE
LTB: LARGE TAXPAYER BRANCH
IPC: INFORMATION PROCESSING CENTRE
73
HASiL's
Diary
75
January
Official Opening of Menara Hasil Melaka | 8 January 2015
February
Teh Tarik Session with Tan Sri Dr. Mohd Irwan Serigar | 23 February 2015

April
March
19th Hari Hasil Celebration | 2 March 2015
April
LHDNM-OECD International Tax Avoidance & Countering BEPS | 20 April 2015
77
May
MoU Signing Ceremony between The Goverment of Malaysia and IRBM|
29 May 2015
June
Hasil Awards Ceremony| 16 June 2015

July
Cinta Malaysia Campaign | 14 July 2015
August
Official Visit to IRBM by Deputy Finance Minister II | 24 August 2015
79
September
Board Member's Appreciation Ceremony | 18 September 2015
October
Budget Talk 2016 | 26 October 2015

November
Innovation Day Celebration| 2 November 2015
December
Official Opening of Information Processing Centre | 22 Disember 2015
81
FINANCIAL PERFORMANCE
REPORT 2016
83
AUDIT
CERTIFICATE

85
STATEMENT OF
BOD

DECLARATION OF
PRINCIPAL OFFICER
87
FINANCIAL
STATEMENT
INLAND REVENUE BOARD OF MALAYSIA

(Established According to the INLAND REVENUE BOARD OF MALAYSIA ACT 1995)
BALANCE SHEET
AS AT 31 DECEMBER 2015
2015 2014
Note RM RM
PROPERTY, PLANT AND EQUIPMENT 3 1,397,586,662 1,465,756,936

WORK IN PROGRESS 4 32,525,927 41,992,509
LOANS TO EMPLOYEES 5 1,128,695 1,582,341
1,431,241,284 1,509,331,786
CURRENT ASSETS
Loans to Employees 5 603,423 598,925
Deposits and Prepayments 6 2,560,187 8,556,363
Payment Of Advances 7 191,747 144,149
Other Debtors 8 285,029,673 246,610
Accrued Interest On Investments 54,877 389,877
Goods and Service Tax Receivable 9 6,502,473 -
Fixed Deposits and Short Term Investments 10 151,000,000 331,000,000
Cash and Bank Balances 4,533,361 17,848,984
TOTAL CURRENT ASSETS 450,475,741 358,784,908
CURRENT LIABILITIES
Other Creditors 11 152,279,015 98,039,446
Term Loans 12 16,412,384 31,599,764
Finance Lease 13 2,500,599 2,369,917
Deposits 14 1,462,842 5,125,473
Provision For Doubtful Debts - 665
Provision For Audit Fees 80,000 80,344
TOTAL CURRENT LIABILITIES 172,734,840 137,215,609
NET CURRENT ASSETS 277,740,901 221,569,299
1,708,982,185 1,730,901,085
The accompanying on pages 93 to 114 are in integral part of the Financial Statement

BALANCE SHEET
AS AT 31 DECEMBER 2015
2015 2014
Note RM RM
FUNDED BY:
Development Reserve 15 755,184,303 853,281,529
Trust Reserve 16 3,835,500 2,888,089
Investment Reserve 17 18,000,000 18,000,000
Conveyance Reserve 18 18,000,000 18,000,000
Revaluation Reserve 281,646,880 281,646,880
Retained Earnings 19 624,708,374 530,564,476
1,701,375,057 1,704,380,974
LONG TERM LIABILITIES

Term Loans 12 - 16,412,384
Finance Lease 13 7,607,128 10,107,727
7,607,128 26,520,111
1,708,982,185 1,730,901,085
89
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2015
2015 2014
Note RM RM
Revenue 20 2,049,556,644 1,868,220,776
Other Operating Income 21 479,613 1,681,304
Employee Costs 22 (1,387,439,679) (1,243,947,990)

Depreciation / Impairment Loss Of Property,
Plant and Equipment 3 (101,356,529) (111,623,266)
Other Operating Expenses 23 (459,152,469) (645,421,720)

Surplus / (Deficit) From Operations 102,087,580 (131,090,896)
Finance Costs (15,997,243) (15,559,783)
Income From Investments And Loans 8,053,561 17,061,425
Current Year Surplus / (Deficit) 94,143,898 (129,589,254)

STATEMENT OF CHANGES IN EQUITY

Investment/
Development Trust Conveyance Revaluation Retained
Reserve Reserve Reserve Reserve Earnings Total
RM RM RM RM RM RM
Balance As At
1 Jan 2015 853,281,529 2,888,089 36,000,000 281,646,880 530,564,476 1,704,380,974
Current
(Deficit)/
Surplus (98,097,226) 947,411 - - 94,143,898 (3,005,917)
Land
Valuation - - - - - -
Building
Valuation
- - - - - -
Balance As At
31 Dec 2015 755,184,303 3,835,500 36,000,000 281,646,880 624,708,374 1,701,375,057
Balance As At
1 Jan 2014 865,526,415 2,860,717 36,000,000 281,646,880 660,153,730 1,846,187,742
Current
(Deficit) /
Surplus (12,244,886) 27,372 - - (129,589,254) (141,806,768)
Land
Valuation - - - - - -
Building
Valuation
- - - - - -
Balance As At
31 Dec 2014 853,281,529 2,888,089 36,000,000 281,646,880 530,564,476 1,704,380,974
91
The accompanying on pages 8 to 29 are in integral part of the Financial Statement.

CASH FLOW STATEMENT

2015 2014
Note RM RM
CASH FLOWS FROM OPERATING ACTIVITIES

Grant Received From Federal Government and other
income 24 1,664,917,245 1,707,781,120
Payment To Suppliers And Employees 25 (1,770,286,950) (1,737,890,663)
NET CASH (USED IN) /GENERATED FROM OPERATING
ACTIVITIES (105,369,705) (30,109,543)
CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition Of Property, Plant And Equipment Including Work
(23,348,805) (9,262,413)
In Progress
Proceeds From Disposal Of Property, Plant And Equipment 92,601 125,019
Increase In Investments And Loans 8,388,561 17,341,521
Loans To Employees 449,147 (242,473)
NET CASH (USED IN) / GENERATED FROM INVESTING
ACTIVITIES (14,418,496) 7,961,654
CASH FLOWS FROM FINANCING ACTIVITIES

Repayment Of Development Reserve (2,910,631) 71,542,427
Proceeds From Trust Reserve 1,350,132 411,610
Repayment Of Term Loans (31,599,764) (31,599,764)
Repayment Of Finance Lease Liabilities (2,369,916) 12,477,644
Finance cost (15,997,243) (15,559,783)
NET CASH (USED IN) / GENERATED FROM FINANCING
ACTIVITIES (73,527,422) 37,272,134
Net (Decrease) / Increase In Cash (193,315,623) 15,124,245
Cash And Cash Equivalents At The Beginning Of The Year 348,848,984 333,724,739
Cash And Cash Equivalents At The End Of The Year 155,533,361 348,848,984
CASH AND CASH EQUIVALENTS AT 31 DECEMBER

Fixed deposits and short term investments 151,000,000 331,000,000
Cash and bank balances 4,533,361 17,848,984
155,533,361 348,848,984
The accompanying on pages 8 to 29 are in integral part of the Financial Statement.

7
NOTES TO THE FINANCIAL STATEMENT

1. CORPORATE REVIEW
1.1 Related Act and Function
Inland Revenue Board of Malaysia (IRBM) was incorporated on 1st March

1996 under INLAND REVENUE BOARD OF MALAYSIA ACT 1995, (Act
533).
IRBM acts as an agent to the government and providing services related

to the administration, assessment, collection and enforcement on the
payment of income tax, tax on income from petroleum, real property gain
tax, tax on income from Labuan offshore business activity, stamp duty,
inheritance duty and other taxes.
1.2 Presentation of Financial Statement and Validation
Financial Statement for the Year Ended 31 December, 2015 were

authorised for issue by the Board of Directors on 29 July, 2016.
2. SIGNIFICANT ACCOUNTING POLICIES
2.1 Basic of Accounting
The preparation of the financial statement of IRBM requires management

to make judgments, estimations and assumptions that affect the
application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these
estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis.

Revisions to accounting estimates recognized in the period in which the
estimates revised and in any future periods affected.
The accounts of IRBM have been prepared in accordance with:
i. The historical cost; and
ii. The approved accounting standards by Malaysian Accounting

Standards Boards (MASB), which is Private Entity Reporting
Standards (PERS).
IRBM will adopt Malaysian Private Entity Reporting Standards (MPERS)

for the financial year with effect beginning or after 1 January 2016 in
accordance with statutory requirements by MASB.
93
2.2 Property, Plant and Equipment
Items of Property, Plant and Equipment measured at cost less any

accumulated depreciation and any accumulated impairment losses.
Cost includes expenditure cost that are directly attributable to the

acquisition of the asset. The costs of repair, maintenance and renovation
recognized in profit or loss as incurred.
Property, Plant and Equipment, which cost not less than RM1,000 per unit,
shall be capitalised. However carpet, curtain and related items acquired
irrespective the cost shall not be capitalised.
Depreciation
Depreciation based on a straight-line method throughout the estimated

useful lives of each components of an item of Property, Plant and
Equipment from the date that they are available for use as follows:-
Leasehold land Period of leases

Buildings 2%-3%
Furniture and Fittings 20%
Motor Vehicles 20%
Computers 33.33%
Freehold Land and work in progress are not depreciated.
Work in Progress is stated at cost and capitalized as Property, Plant and

Equipment after the certificate of completion or certificate of acceptance
received by the IRBM.
The depreciation rate on purchase of completed building which the cost of

land and building could not be specifically identified at the acquisition
stage will follow the depreciation rate of building which is at 2% per year.
At each balance sheet date, the residual values and useful lives of assets
are reviewed and adjusted if appropriate, and assets must be assessed
whether there is any indication of impairment.
Asset Revaluation
Revaluation on properties consisting of Land and Buildings will made once

every five (5) years. Increases in carrying amounts arising from
revaluation are recognised in an asset revaluation reserve.
Decreases in carrying amounts that offset previous increases of the same

asset are recognised in the asset revaluation reserve. All other decreases
in carrying amounts are recognised in the income statement.

Revaluation surplus transferred directly to retained earnings when the

asset is retired or disposed of. Revaluation date deemed at balance sheet
date.
2.3 Impairment of Assets
Assets that are subject to amortization reviewed for impairment whenever

events or changes in circumstances indicate that the carrying amount may
not be recoverable.
An Impairment Loss recognized for the amount by which the carrying

amount of the asset exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less costs to sell and value in
use.
An Impairment Loss charged to the Income Statement. In respect of other

assets, any subsequent increase in recoverable amount recognized in the
Income Statement unless it reverses an impairment loss on a revalued
asset in which case it transferred to Revaluation Reserve.
2.4 Finance Lease
Leases in terms of which IRBM assumes substantially all the risk and
rewards of ownership classified as finance leases.
Property, Plant and Equipment held under finance leases are capitalised
and depreciated like any other assets as described in Note 2.2. The
corresponding obligations related to principal payments accounted for as
liability and finance charges charged to the income statement over the
period of the lease plan.
2.5 Operating Lease
Leases where IRBM does not asume substantially all the risks and
rewards of ownership are classified as operating leases. Payments made
under operating lease are recognised in profit or loss on a straight-line
basis over the term of the lease.
2.6 Loans to Employees
Loans to employees stated at cost. Bad debt written off in the period in
which they identified. An estimate made for doubtful debts based on
review of all outstanding amounts at year-end.
10
95
2.7 Other Debtors
Other debtors stated at cost less provision for doubtful debts.
2.8 Other Creditors
Other creditors stated at cost that is the fair value of the consideration in
the future for goods and services received.
2.9 Term Loans
Term loans stated at cost.
2.10 Revenue Recognition
IRBM received Agency Fees, which was conditional for financing

operation and development activities. Revenue are recognised when the
proceeds are receivable (on the accrual basis) with exceptions of interest
income from Al-Mudharabah Scheme, Syarikat Takaful Insurance
Protection Scheme and gain on disposal of Property, Plant and Equipment
are recognised upon realized/realizable.
During the financial year, IRBM received Agency Fees from the
government in exchange of Government Grant previously given as stated
in the Agreement between Government and IRBM as at 29 May 2015. The
effective date of commencement of the agreement is as at 6 January 2015.
Basis of determining amount receivable that related to Agency Fees is

calculated based on certain percentage from estimated gross tax related
revenue. Fees received during the financial year be recognised as liability
and will be adjusted accordingly based on actual revenue received by the
government.
2.11 Recognition of Federal Government Grant
i. Development Reserve
No grant received for financing development expenditure for

the financial year ended.
The funding of capital expenditure refer to government grant

received before 2015, reclassified as deferred income and
credited / charged to income statement with the depreciation
value of the said asset during the year.
11
ii. Conveyance, Motor Vehicles, Computer, Trust and

Investment Reserve
No grant received for financing the respective reserves for

the financial year ended.
2.12 Foreign Currency Transaction
Transactions in foreign currencies translated to the respective functional

currency of Ringgit Malaysia (RM) at exchange rates of the dates of the
transactions. The exchange differences recognized in profit or loss.
2.13 Cash and Cash Equivalents
IRBM adopts Direct Method in the preparation of Cash Flow Statement.

For the purpose of the statement of cash flow, cash and cash equivalents
consist of cash on hand, balances and pledged deposits with banks and
liquid investments with original maturities of less than one year.
2.14 Financial Risk Management Policies
The financial risk management policy in IRBM is to ensure that IRBM has
sufficient capability and financial capacity to withstand potential future
losses. IRBM carried out the operations based on policies approved by the
Government and IRBM itself.
The major financial risks faced by IRBM and the policies related to principal
operating activities are as follows:
i. Interest Rate Risk
IRBM would try to obtain loan based on fixed rate to diminish the
increase of interest rate and hence reducing the interest rate risk.
ii. Credit Risk
Credit risk controlled through credit approval procedure, limits and

observation. Internal examination on the credit will done if the risks
are material.
iii. Liquidation and Cash Flow Risk
Liquidity risk management implies maintaining careful cash and the

availability of sufficient funds to meet the budget commitment of
operating expenses and financial liabilities.
12
97
2.15 Employee Benefits / Employee Retirement Benefits
Employee benefits / staff retirement benefits are as follows:
i. Short Term Retirement Benefits
Salaries and allowances recognized as expenses in the Income

Statement in the year the employees rendered their services to
IRBM.
ii. Defined Contribution Plans
Contributions made to the Social Security Organisation are for

eligible employees.
Contribution made to Employees Provident Fund (EPF) for the staff

under the IRBM Remuneration Scheme or to Retirement Fund
Incorporated for those in the pension scheme.
The contributions recognized as an expense in the Income

Statement in the year the employees rendered their services to
IRBM except for the annual bonuses recognised as expenses when
it actually received.
iii. Long Term Retirement Benefits
The types of long-term benefits recognized as an expense in the

Income Statement in the year occurs are as follows:
a) Medical benefit for retirees
b) Cash award in lieu of accumulated annual leave
c) Gratuity for retirees
LHDNM Board of Directors Meeting Vol. 3 Year 2013 on 26

June 2013, has approved gratuity for retirees under the IRBM
Remuneration Scheme. It is an extension of the approval from
the Federal Government with regard to the grant of the gratuity
to seven Statutory Bodies with Separated Remuneration.
13
3. PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT - TOTAL
Motor Furniture &

Land Building Vehicles Fittings Computer Total
RM RM RM RM RM RM
Cost/Revaluation
Balance As At 1 Jan 2015 192,884,303 1,174,902,766 50,444,020 55,772,910 375,051,677 1,849,055,676

Additions - - 128,000 2,445,893 14,334,973 16,908,866
Disposals - - (875,172) (1,270,602) (97,473,327) (99,619,101)
Adjustment - - (182,512) 2,195,436 410,451 2,423,375
Transfer from Work In Progress 1,850,050 - - 27,370 11,825,158 13,702,578
Balance As At 31 Dec 2015 194,734,353 1,174,902,766 49,514,336 59,171,007 304,148,932 1,782,471,394
Accumulated Depreciation
Balance As At 1 Jan 2015 807,121 24,041,057 34,405,668 37,752,030 286,292,864 383,298,740
Current Year Charge 906,609 26,699,568 3,720,686 7,146,956 62,882,710 101,356,529
Disposals - - (875,156) (1,269,075) (97,300,933) (99,445,164)
Adjustments - - (164,325) (152,382) (8,666) (325,373)
Balance As At 31 Dec 2015 1,713,730 50,740,625 37,086,873 43,477,529 251,865,975 384,884,732
Net Book Value
Balance As At 31 Dec 2015 193,020,623 1,124,162,141 12,427,463 15,693,478 52,282,957 1,397,586,662
Cost/Revaluation
Balance As At 1 Jan 2014 190,890,580 1,041,977,197 35,804,602 48,908,686 295,644,327 1,613,225,392
Additions 90,605 - 14,597,863 2,008,919 225,380 16,922,767
Disposals - - (1,111,402) (2,029,947) (6,348,215) (9,489,564)

- - 1,152,957 4,521,774 1,959,960 7,634,691
Adjustments
Transfer from Work In Progress 1,903,118 132,925,569 - 2,363,478 83,570,225 220,762,390

Balance As At 31 Dec 2014 192,884,303 1,174,902,766 50,444,020 55,772,910 375,051,677 1,849,055,676
Accumulated Depreciation
Balance As At 1 Jan 2014 - - 32,821,243 34,230,975 212,671,399 279,723,617

Current Year Charge 807,121 24,041,057 2,637,649 4,220,085 79,917,354 111,623,266
Disposals - - (1,111,382) (2,018,083) (6,324,599) (9,454,064)
Adjustments - - 58,158 1,319,053 28,710 1,405,922
Balance As At 31 Dec 2014 807,121 24,041,057 34,405,668 37,752,030 286,292,864 383,298,740
Net Book Value
Balance As At 31 Dec 2014 192,077,182 1,150,861,709 16,038,352 18,020,880 88,758,813 1,465,756,936
Note:
46.64% or RM90,019,541 from Net Book Value of land as at 31 December 2015 are owned by Pesuruhjaya Tanah Persekutuan (PTP).
Revaluation assets refers to land and buildings.
99
14
4. WORK IN PROGRESS
Operation Development
Reserve Reserve Total
RM RM RM
Balance As At 1 Jan 2015 13,208,976 28,783,533 41,992,509
Additions 998,397 29,667,029 30,665,426
Transfer to Property, Plant

and Equipment (1,850,050) (11,852,528) (13,702,578)
Transfer to Development
Reserve - (26,406,083) (26,406,083)
Adjustments (23,347) - (23,347)

Balance As At 31 Dec 2015 12,333,976 20,191,951 32,525,927
Balance As At 1 Jan 2014 12,515,463 262,538,946 275,054,409
Additions 3,604,143 63,290,275 66,894,418
Transfer to Property, Plant

and Equipment (1,969,742) (218,792,648) (220,762,390)
Transfer to Development
Reserve - (80,257,770) (80,257,770)
Adjustments (940,888) 2,004,730 1,063,842

Balance As At 31 Dec 2014 13,208,976 28,783,533 41,992,509
15
5. LOANS TO EMPLOYEES
Conveyance Computer Education Others
Loan Loan Loan Loan Total
RM RM RM RM RM
Balance As At 1 Jan 2015 560,201 903,626 783,715 15,901 2,263,443

Loans to employees 165,400 486,500 117,264 42,000 811,164
725,601 1,390,126 900,979 57,901 3,074,607
Less :
Repayment of loans 190,823 451,738 72,093 44,901 759,555
Balance of loans write-off* - - 504,831 - 504,831
Balance As At 31 Dec 2015 534,778 938,388 324,055 13,000 1,810,221
Less :
73,135 4,968 - - 78,103
Provision for doubtful debts
461,643 933,420 324,055 13,000 1,732,118
Reconciliation of Provision For Doubtful Debts as follows :
Balance As At 1 Jan 2015 77,209 4,968 - - 82,177

Less:
Provision recovered 2,000 - - - 2,000
Provision write-off 2,074 - - - 2,074
Balance As At 31 Dec 2015 73,135 4,968 - - 78,103
Balance As At 1 Jan 2014 553,823 722,675 746,873 - 2,023,371

Loans to employees 216,801 589,100 41,248 47,700 894,849
770,624 1,311,775 788,121 47,700 2,918,220
Less :
Repayment of loans 210,423 408,149 4,406 31,799 654,777
Balance of loans write-off* - - - - -
Balance As At 31 Dec 2014 560,201 903,626 783,715 15,901 2,263,443
Less :
77,209 4,968 - - 82,177
Provision for doubtful debts
482,992 898,658 783,715 15,901 2,181,266
Reconciliation of Provision for Doubtful Debts as follows :
Balance As At 1 Jan 2014 79,609 4,968 - - 84,577

Less:
Provision recovered 2,400 - - - 2,400
Provision write-off - - - - -
Balance As At 31 Dec 2014 77,209 4,968 - - 82,177
* Balance of the loan write-off refers to remaining balance of convertible education loan of employees that are eligible to convert
from loan to scholarships education after the respective employee succeeded to comply with the requirements stated by IRBM.
The write-off amount recognized as expenses in the income statement in the year where the period of eligibility of the agreement
expired.
101
16
Loans to Employees Shown In The:
2015 2014
RM RM
Current Assets (Receivable within 12 months) 603,423 598,925
Non-Current Assets 1,128,695 1,582,341
1,732,118 2,181,266
Loans to employees as follows:

Scheme Repayment Period Service Fee
Years % / Year
Motor Vehicles 6–9 4 % (reducing balance)
Computer 4 4% (reducing balance)
Education 5 -
Zero Interest Loan 1 -
6. DEPOSITS AND PREPAYMENTS
2015 2014
RM RM
Water Deposits 53,110 52,210

Electricity Deposits 755,270 754,470
Office Rental Deposits 182,290 79,790
Prepayment Of Health Insurance Premium 1,406,492 1,328,226
Prepayment Of Supply And Services 153,676 6,332,318
Other Prepayments 9,349 9,349
2,560,187 8,556,363

7. PAYMENT OF ADVANCES
Total
Emolument Employee Others
RM
RM RM RM
Balance
21,029 63,576 59,544 144,149
As At 1 Jan 2015
Advances 76,133 763,872 6,072,920 6,912,925

97,162 827,448 6,132,464 7,057,074
Less:
Repayment of advances 65,514 801,369 5,998,444 6,865,327
Balance
As At 31 Dec 2015 31,648 26,079 134,020 191,747
Balance
9,978 11,370 160,748 182,096
As At 1 Jan 2014
Advances 69,346 871,804 7,329,878 8,271,028

79,324 883,174 7,490,626 8,453,124
Less:
Repayment of advances 58,295 819,598 7,431,082 8,308,975
Balance
As At 31 Dec 2014 21,029 63,576 59,544 144,149
8. OTHER DEBTORS
2015 2014
RM RM
Emolument Debtors 118,934 72,802

Trade Debtors 65,065 173,808
Service Agency Debtors* 284,845,674 -
285,029,673 246,610
Debtors Service Agency is Receivable Fees from Federal Government for year
2015.
9. GOODS AND SERVICE TAX RECEIVABLE
The introduction of goods and service tax (GST) which takes effect on 1st April
2015 and governed by the Goods and Services Tax Act 2014 (Act 762). IRBM is
a registered firm under the Act to allow incorporating output tax on goods and
services rendered and incurred input tax deduction for use in the operations. The
aggregate of all input tax received would be deducted from all output tax billed
and accounted as GST receivable by RMC for the period from July 2015 to
December 2015.
18 103
10. FIXED DEPOSITS AND SHORT TERM INVESTMENTS
2015 2014
RM RM
Fixed Deposits 61,000,000 231,000,000

Repurchase Agreements (Repo) 90,000,000 100,000,000
151,000,000 331,000,000
The effective placement rate for fixed deposits and short term investments range
is from 2.62% to 4.05% per annum (2014: 3.10% to 3.80% per annum) with the
holding periods up to three months.
11. OTHER CREDITORS
2015 2014
RM RM
Accrued Gratuity For Retirees* 81,601,019 81,601,019

Supply And Services 66,215,028 15,683,825
Accrued Interests On Terms Loan 4,462,968 754,602
152,279,015 98,039,446
*Accrued Gratuity For Retirees involves the provision of benefits to retirees under
the IRBM Remuneration Scheme who retired from 1March, 1996 until 31 March,
2013. Distribution of payments conducted in continuous manner in the current
financial year after funds received from Government in December 2015 and
January 2016 respectively.
19
12. TERM LOANS

2015 2014
RM RM
Repayment Of Term Loans

- Within 1 year 24,514,717 46,927,764
- 1 to 5 years - 24,514,717
24,514,717 71,442,481
Less: Service Cost On Term Loans 8,102,333 23,430,333
Current Value Of The Term Loans 16,412,384 48,012,148
2015 2014
RM RM
Term Loans Shown As:
Current Liabilities
- Within 1 year 16,412,384 31,599,764
Long Term Liabilities

- 1 to 5 years - 16,412,384
Current Value Of The Term Loans 16,412,384 48,012,148
IRBM had received loans from Retirement Fund (Incorporated). The details of
IRBM’s with Retirement Fund (Incorporated) are as follows:
Loan Administration Repayment
Year Amount Fee Period Building/Land
RM % / Year Year
2008 103,800,000 6 8 Menara Hasil, Petaling Jaya, Selangor
(Fixed Rate)
2008 140,000,000 6.5 8 Akademi Percukaian Malaysia Kuching

(Fixed Rate)
13. FINANCE LEASE
2015 2014
RM RM
Repayment Of Finance Lease
- Within 1 year 2,983,860 2,983,860

- 1 to 5 years 8,201,711 11,185,571
11,185,571 14,169,431
Less: Service Cost On Finance
Lease 1,077,844 1,691,787
Current Value Of The Finance Lease 10,107,727 12,477,644
20
105
2015 2014
RM RM
Finance Lease Shown As:
Current Liabilities
- Within 1 year 2,500,599 2,369,917
Long Term Liabilities

- 1 to 5 years 7,607,128 10,107,727
Current Value Of The Finance Lease 10,107,727 12,477,644
IRBM obtained borrowings by way of finance lease for motor vehicles acquisition
of RM14,597,863 in year 2014 with carrying interest service rate of 5.0% to 5.7%
per annum (2014: 5.0% to 5.7%).
14. DEPOSITS
2015 2014
RM RM
Special Deposits 972,979 4,354,256

Retention Monies 475,011 136,182
Guaranteed Money 8,850 16,450
Other Deposits 6,002 618,585
1,462,842 5,125,473
15. DEVELOPMENT RESERVE
Development Reserve consists of grants given by Federal Government as at 31

December 2014 to finance capital development projects (buildings and
computerization) under 8th, 9th and 10th Malaysian Plan (RMKe-8, RMKe-9 and
RMKe-10). Amortisation of the fund in current financial year considered in return
of the benefits provided for the usage of property, plant and equipment in which
similar to the depreciation of property, plant and equipment
2015 2014
RM RM
Balance As At 1 January 853,281,529 865,526,415
Cash receipts from Federal Government - 140,408,242
Non-cash receipts from Federal Government - 7,319,036

853,281,529 1,013,253,693
21
Less: Amortisation of Development Grant - -

Cash Expenditure 24,910,631 76,184,851
Depreciation Of Property, Plant And
Equipment 73,186,595 83,787,313
98,097,226 159,972,164
Balance As At 31 December 755,184,303 853,281,529

*No development grant received from Federal Government in return of the Agency Fees received effective financial year 2015
16. TRUST RESERVE
IRBM Trust Reserve consists of:
16.1 Kumpulan Wang Amanah Akademi Percukaian Malaysia was set-up to

account for revenue and expenses related to the welfare of participants
involved in courses given, training activities, research and publications of
Akademi Percukaian Malaysia (APM). It also involves international
courses in collaboration with the Economic Planning Unit (EPU), Prime
Minister’s Department under the Malaysian Technical Cooperation
Program.
16.2 Tabung Wang and effective Ihsan LHDNM (also known as Trust
Account) established from 1 January 2015. It is intended to manage aid
to IRB employees, beneficiaries and external parties, donations and
assistance to charities, help victims and other welfare programs to
support Government functions in performance corporate social
responsibility (CSR) to employees and the public generally.
2015 2014
Akademi Akademi
Percukaian Tabung Percukaian Tabung
Malaysia Ihsan Total Malaysia Ihsan Total
RM RM RM RM RM RM
Revenue
Revenue from Internal

Resources 358,552 138,540 497,092 451,074 - 451,074
Contributions from External
Resources 717,038 1,515,235 2,232,273 595,065 - 595,065
Interests received 39,432 - 39,432 27,859 - 27,859
1,115,022 1,653,775 2,768,797 1,073,998 1,073,998
Less: Expenditure
Cash Expenditure 522,945 895,720 1,418,665 662,388 - 662,388
Depreciation of
Property, Plant and
Equipment 402,721 - 402,721 384,238 - 384,238
925,666 895,720 1,821,386 1,046,626 - 1,046,626
22
107
Current Surplus 189,356 758,055 947,411 27,372 - 27,372
Accumulated Surplus From

Previous Year 2,928,260 - 2,928,260 2,860,717 - 2,860,717
Adjustments
(40,171) - (40,171) - - -
Accumulated Surplus
Carried Forward 3,077,445 758,055 3,835,500 2,888,089 - 2,888,089
17. INVESTMENT RESERVE
Investment Reserve of RM18,000,000 is a financing grant given by Ministry of

Finance (refer letter dated 21 Mac 1997) when IRBM was incorporated. It’s
purpose as an investment mechanism in generating additional income to IRBM.
IRBM was given the power under Section 28, Inland Revenue Board of Malaysia
Act 1995 to make investing activities with limitation to invest in fixed savings,
bankers’ acceptance and repurchase agreements in banks and licensed financial
institutions under Banking Act and Financial Institutions Act 1989 and approved
by Ministry of Finance.
18. CONVEYANCE RESERVE

Motor Vehicles Computer Education Total
RM RM RM RM
Approved Fundings 14,000,000 3,000,000 1,000,000 18,000,000
Balance at 1 Jan 2015 13,423,898 2,096,374 216,285 15,736,557
Less:
Loans to employees 207,400 486,500 117,264 811,164
13,216,498 1,609,874 99,021 14,925,393
Add:
Repayments from 235,724 451,738 72,093 759,555

employees
Balance of loans write-off - - 504,831 504,831
Balance at 31 Dec 2015 13,452,222 2,061,612 675,945 16,189,779
Balance at 1 Jan 2014 13,446,177 2,277,325 253,127 15,976,629
Less:
Loans to employees 264,501 589,100 41,248 897,249
13,181,676 1,688,225 211,879 15,079,382
Add:
Repayments from employees 242,222 408,149 4,406 657,177
Balance at 31 Dec 2014 13,423,898 2,096,374 216,285 15,736,557
23

19. RETAINED EARNINGS
2015 2014
RM RM
Retained Earnings from previous year 530,564,476 660,153,730

Surplus /(Deficit) of current year 94,143,898 (129,589,254)
Retained Earnings carried forward 624,708,374 530,564,476
20. REVENUE
With effect in the year 2015, the main revenue of IRBM which is Agency Fee
receivable from Federal Government upon performance condition are met as
set out in Section 10 of the Inland Revenue Board Act 1995. Revenue comprise
of income from the following resources:
2015 2014
RM RM
Agency Fee 1,818,537,574 -

Federal Government Grant 128,000,000 1,704,527,700
Amortization Of Development Reserve 98,097,226 159,972,164
Amortization Of Trust Reserve 1,821,386 1,046,626
Previous Year Repayment Received 1,387,440 1,051,182
Rental 332,223 807,865
Penalties 173,137 464,307
Sales Of Other Printing Goods 351,014 146,998
Profits Of Insurance Protection Scheme
From Takaful Company 138,463 107,856
Other Income 718,181 96,078
2,049,556,644 1,868,220,776
21. OTHER OPERATING INCOME
Other operating income consist of:

2015 2014
RM RM
Proceeds From Sales Of Store Items 16,144 2,170

Proceeds From Disposal Of Property, Plant
And Equipment 94,213 90,222
Non-Cash Items (In Assets Form) 369,256 1,588,912
479,613 1,681,304
24
109
22. EMPLOYEE COSTS
Employee Costs consist of:

2015 2014
RM RM
Salaries 802,725,120 775,354,044

Fixed Allowances 110,575,026 106,371,141
Statutory Contributions 213,789,429 205,040,314
Overtime Allowances 7,539,048 7,963,159
Other financial benefits 252,811,056 240,757,046
1,387,439,679 1,335,485,704
23. OTHER OPERATING EXPENSES
2015 2014
RM RM
Expenditure And Subsistence 21,884,265 23,072,779

Transportation 1,146,068 3,204,850
Communication And Utility 73,886,390 61,062,569
Rental 99,443,807 84,791,006
Supplies And Materials For Maintenance 1,806,812 1,800,222
Sundry Materials And Supplies 11,416,738 12,373,285
Maintenance And Minor Repairs 30,524,871 27,880,155
Professional Services And Hospitality 103,638,239 100,401,223
Audit Fee 80,000 80,344
Clinical And Medical Services 20,296,453 19,048,181
Grants And Fixed Payment Charge 47,479,910 123,837,996
Miscellaneous 21,219,620 19,484,157
Amortization Of Cash Expenditure For
24,910,631 76,184,851
Development Reserve
Amortization Of Cash Expenditure For
1,418,665 662,388
Trust Reserve
459,152,469 553,884,006

25
24. RECEIPTS FROM FEDERAL GOVERNMENT AND OTHER INCOME
2015 2014
RM RM
Agency Fee 1,533,691,900 -

Federal Government Grant 128,000,000 1,704,527,700
Previous Year Repayment Received 1,387,440 1,051,182
Rental 332,223 807,865
Penalties 173,137 464,307
Sales Of Other Printing Goods 351,014 146,998
Profits Of Insurance Protection Scheme
From Takaful Company 138,463 107,856
Other Income 718,181 96,078
Proceeds From Sales Of Store Items 16,144 2,170
Trade Debtors 108,743 576,964
1,664,917,245 1,707,781,120
25. PAYMENT TO SUPPLIERS AND EMPLOYEES
2015 2014
RM RM
Employee Costs (Note 22) 1,387,439,679 1,335,485,704

Other Operating Expenditure 432,823,173 477,036,767
Other Creditors (54,239,569) (74,249,058)
Deposits 3,662,632 (1,694,743)
Deposits And Prepayments (5,996,177) 1,324,757
Advance Payment 47,598 (37,947)
Employee Debtors 46,132 25,848
Audit Fee Charges 1,009 (665)
GST Input Tax 6,502,473 -
1,770,286,950 1,737,890,663
26. CAPITAL COMMITMENT
2015 2014
RM RM
Approved and Contracted 163,489,636 90,814,864
111
26
27. CONTINGENT LIABILITIES
IRBM is defending an action brought by a professional consulting firm of

RM1,470,021 inclusive of professional fees of RM1,246,145 and reimbursement
fee of RM223,876. On 29 March 2016, the Court had decided that the plaintiff
brought the matter to the registered Arbitrary and IRBM estimated the cost of
arbitrary could amount to RM50,000. There is no provision in the Financial
Statements for the claim because it does not affect the financial position of the
IRBM.
28. OPERATING LEASES
Non-cancellable operating lease rentals are payable as follows:
2015 2014
RM RM
Payable:
Within 1 year 83,787,560 28,356,535
1 to 5 years 64,913,239 148,700,800
148,700,799 177,057,335
27
29. FINANCIAL INSTRUMENTS
29.1. Interest Rate Risk
Interest rate risk refers to variances due to the changes of market interest
rate and the average effective interest rate based on the financial assets
and financial liabilities as follows:
Total Effective
Carrying Within 1 To 5 After 5 Interest
Amount 1 Year Years Years Rate
RM’000 RM’000 RM’000 RM’000 %

2015
Financial Assets
Loans to employees 1,732 603 1,128 - 4.0
Fixed deposits and
151,000 151,000 - - 2.62 – 4.05
short term investments
Cash and bank balances 4,533 4,533 - -
157,265 156,136 1,128 -
Financial Liabilities
Term loans 16,412 16,412 - - 6.0 – 7.0
Finance leases 10,108 2,501 7,607 - 5.0 – 5.7
26,520 18,913 7,607 -
2014
Financial Assets
Loans to employees 2,181 599 1,582 - 4.0
Fixed deposits and
331,000 331,000 - - 3.1 – 3.8
short term investments
Cash and bank balances 17,849 17,849 - - -
351,030 349,448 1,582 -
Financial Liabilities
Term loans 48,012 31,600 16,412 - 6.0 – 7.0
Finance leases 12,478 2,370 10,108 - 5.0 – 5.7
60,490 33,970 26,520 -
29.2. Credit Risk
Maximum credit risk involving financial assets identified as the carrying

amount as stated in the balance sheet. IRBM does not have any specific
deal towards the credit risk with any other parties.
26.3. Fair Value
The carrying amount for all the financial assets and financial liabilities of
IRBM on the Balance Sheet date estimated at fair value.
30. INCOME TAX
Refers to the power of the Minister in section 127 (3) (b) of the Income Tax Act,
1967, IRBM has been granted exemption from payment of income tax in respect
of all income (excluding dividends) for the period from the year of assessment
1997 until the subsequent years of assessment. The exclusion order is a
reference to the Income Tax (Exemption) (No. 20), 2000.
28
113
Exemption in respect of dividend income received by IRBM falls under the

single-tier system [paragraph 21B, Schedule 6 Tax Exemption, Income Tax Act
1967].
31. COMPARATIVE FIGURES
The comparative figures reclassified to restate in the Financial Statement of 2015

in order to present the movement of certain items in the current year.
Restated As Stated In
Previous Year
RM RM
Income Statement
- Employee costs 1,335,485,704 1,243,947,990
- Other Operating Expenses 553,884,006 645,421,720
32. GENERAL INFORMATION
The number of employees at the end of the financial year was 13,793 compared
to 13,717 persons in 2014. The differences consists of the reduction of 236
permanent employees, increase of 18 contract staffs and 294 temporary staffs.
The decline in the number of permanent employees is due to the retirement

period of employee in year 2015.
29
FINANCIAL
PERFORMANCE
REPORT
INCOME
The total income for the IRBM for the year ending 31 December 2015 was RM2,058.09 million comprising:
Agency Fees
Starting from 2015, the IRBM’s main source of revenue was agency fees from the federal government for services
provided as stipulated in Section 10 of the Inland Revenue Board of Malaysia Act 1995. The IRBM receives
agency fees in lieu of the federal government grant received prior to this pursuant to an agreement between
the IRBM and the Government of Malaysia on 29 May 2015. The said agreement came in force on 6 January
2015. The calculation of the estimated fee payable by the government is based on the total estimation of
gross revenue in a year. The total agency fees received in 2015 was RM121.236 billion. The income from fees
contributed 88.36% of the IRBM’s total income.
Government Grant
The IRBM no longer receives a management and development grant (2014: RM1,634.53 million) which has been
replaced with agency fees in line with the policy change arising from the shift from being a government-based
financing entity to a self-financing entity. However, in the current year, the IRBM received a grant of RM128
million from the government which comprised funding for BR1M of RM68 milion (2014: RM70 milion) and end
of service gratuity of RM60 milion. The portion of the grant utilised in 2015 was RM99.92 milion comprising the
provision for development grant (rm98.10 million) and the trust fund grant (RM1.82 million).
Other Income
Apart from agency fees and government grants, other sources of income contributed to the IRBM’s total income
such as Interest from investments and borrowings of RM8.05 million (2014: RM17.06 million), Rental income of
RM0.33 million (2014: RM0.81 million), reversal of payments from previous years of rm1.39 million (2014: rm1.05
million) and other income of RM1.86 million (2014: RM2.50 million).
On the whole, the IRBM’s income increased by 9.07% from RM1,886.96 million in 2014. The increase was
attributable to the receipt of agency fees, the end of service gratuity, increase in sale of printed documents
and sale of store items and other income.
115
Chart 1: Income for the Year Ending 31 December 2015
Others
Rental
Reversals of Payment from

Previous Years
Interest on Investments
& Borrowings
Amortised Goverment
Grant
Goverment
Grant
Agency Fees

EXPENDITURE
Summary of Expenditure
The IRBM’s total expenditures for the year ending 31 December 2015 were RM1,963.95 million (2014: RM2,016.55
million). Staff cost was the biggest expense for the IRBM at RM1,387.44 million (2014: RM1,335.49 million), followed
by professional and hospitality service expenses of RM124.01 million (2014: RM119.53 million). Apart from that,
other expenses included depreciation and impairment loss of property, plant and equipment of RM101.36
million (2014: RM111.62 mlilion), rental expenses of RM99.44 million (2014: RM84.79 million), communication
and utility expenses of RM73.89 million (2014: RM61.06 million), gifts and fixed charges of RM47.48 million (2014:
RM123.84 million), maintenance and minor repair expenses of RM30.52 million (2014: RM27.88 million), amortised
development and trust fund expenses of RM26.33 million (2014: RM76.85 million), travel and subsistence expenses
of RM21.88 million (2014: RM23.07 million), finance costs of RM16.00 million (2014: RM15.56 million) and other
expenses totalling RM51.67 million (2014: RM52.50 million).
Chart 2: Expenditure for Year Ending 31 December 2015

1.11%
1.55% 1.34%
1.81% 0.81%
2.42%
3.76% Staff cost
5.06% Professional and Hospitality Services
Depreciation/Impairment loss of Property, Plant and

Equipment
5.16% Rental
Communication and Utilities
6.31% Gifts and Fixed Charges
Other Expenses
Maintenance and Minor Repairs
Amortised Cash Expenditure
Travel and Subsistence
Finance Costs
70.65%
Analysis of Expenditure
The IRBM spent 70.65% of the total expenditure for staff cost comprising permanent, contract and part-time staff.
Human resources was an important asset which guaranteed the achievement of the IRBM’s KPIs. The rise in staff
costs was attributable to the annual salary increment of 6% and off-set by the vacant positions yet to be filled
arising from the retirement of staff resulting in a total cost increase of 3.89% as compared to 2014. The second
largest expense was for professional and hospitality services, comprising expenses such as computer licences,
legal services, printing services, advertising, medical expenses and others.
117
Table 1: Comparison of IRBM’s 2014 and 2015 Expenditures
2015 2014
Type of Expenditure
(RM) (RM)
Staff cost 1,387,439,679 1,335,485,704
Professional and hospitality services 124,014,692 119,529,748
Depreciation/Impairment loss of property, plant and

101,356,529 111,623,266
equipment
Rental 99,443,807 84,791,006
Communication and utilities 73,886,390 61,062,569
Gifts and fixed charges 47,479,910 123,837,996
Maintenance and minor repairs 30,524,871 27,880,155
Amortised cash expenditure 26,329,296 76,847,239
Travel and susbsistence 21,884,265 23,072,779
Finance costs 15,997,243 15,559,783
Other expenses 35,589,238 36,862,514
Total 1,963,945,920 2,016,552,759
Comparison of Expenditure
On the whole, the IRBM’s expenditure decreased by 2.61% from RM2,016.55 million in 2014. The biggest contributor
to this decrease in expenses was the decrease in expenses in relation to gifts and fixed charges (61.66%) and the
accrued ESG for 2014 in respect of retirees from 1997 until 31 March 2013 totalling RM81.60 million. Apart from
that the amortised cash expenditure in respect of development grant and trust fund grant showed a decrease
of 65.74% due to realignment of development project proposals.
Nevertheless there was also an increase in expenditure in terms of rental cost (17.28%) attributable to the
migration of several branches to new buildings or office space, in view of the increase in number of staff and
taxpayers, whereas the increase in communication and utilities (21.00%) was due to the cost of ceased line
charges for the IRBM’s intranet network data system.

Table 2: Financial Performance in Five-Year Period (2011 – 2015)
2011 2012 2013 2014 2015

Essential Financial Statistics
RM’MILLION RM’MILLION RM’MILLION RM’MILLION RM’MILLION
Income 1,191.54 1,696.55 1,948.13 1,886.96 2,058.08
Expenditure 1,118.48 1,582.77 1,907.27 2,016.55 1,963.94
Income Surplus / (Deficit) 73.06 113.78 40.86 (129.59) 94.14
Accumulated Reserves 505.52 619.30 660.15 530.56 624.71
Non-Current Assets 1,436.50 1,405.07 1,609.95 1,509.33 1,431.24
Current Assets 269.50 327.38 343.15 358.78 451.48
Current Liabilities 81.43 62.82 58.90 137.22 172.73
Long-Term Liabilities 113.71 79.61 48.01 26.52 7.61
Chart 3: Performance of Balance Sheet Components in Five-Year Period
PERFORMANCE OF IRBM'S BALANCE SHEET COMPONENTS
119
SUMMARY OF IRBM’s BALANCE SHEET COMPONENTS
The increase in current assets by 25.48% was attributable to the accrued agency fees for 2015. As a result,
current liabilities also increased by 25.88% comprising supply and service creditors.
In respect of long-term liabilities, there was a decrease of 71.30% attributable to the impending settlement
of the loan from the Retirement Fund (Incorporated) to finance the IRBM building, namely the Petaling Jaya
branch and the Kuching Malaysian Tax Academy. There was an outstanding balance of one year to the loan
scheduled to be fully paid off by October 2016.
Chart 4: Performance of Statement of Income Components for the Year Ending 31 December 2015
PERFORMANCE OF IRBM'S STATEMENT OF INCOME COMPONENTS
SUMMARY OF IRBM’S STATEMENT OF INCOME COMPONENTS
The IRBM’s income plays an important role in the planning of its current and non-current expenditures. Its income
is an independent variable whereby the revenue received will determine the pattern of current expenditure and
the planning for long-term expenditure. The decrease in expenditure for 2015 as compared to the preceding
year, by 2.6%, initiated recommendations for the IRBM’s cost-cutting measures for 2015 onwards.

PERFORMANCE OF OPERATING EXPENDITURE BY PROGRAMME AND ACTIVITY
The IRBM’s provisions are distributed and spent according to the 6 main programmes comprising eight activities.
Programmes at the headquarters are tax services, compliance, policy, tax operations and management, while
state programmes cover activities conducted at branches nationwide. The statistics for expenditure according
to programmes are as stated below.
Table 3: Expenditure According to Programme for 2015 and 2014
Tahun 2012 2013

Programme 2015 RM’MILLION RM’MILLION
Tax services 120,977,905 183,412,049 (34.04)
Compliance 94,291,066 101,172,419 (6.80)
Policy 28,733,799 29,095,275 (1.24)
Tax operations 194,911,878 188,707,922 3.29
Management 189,224,038 187,329,063 1.01
State 1,157,071,486 1,100,584,206 5.13
Total 1,785,210,172 1,790,300,934 (0.28)
Expenses in Table 3 are not inclusive of depreciation/impairment loss of property, plant and equipment, and BR1M expenses.
Chart 5: Performance of IRBM's Expenditure According to Programme for 2015
Tax services Compliance

Rm120.98 Million Rm94.29
Million
Policy Rm28.73 Million
Tax operations
Rm194.91 Million
State
Rm1,157.07 Million Management
Rm189.22
Million
121
Tax Services Programme
Expenditure under the tax services programme covers activities such as tax research, corporate services,
internal audit, inspectorate, risk management, tax appeals, intelligence and special investigations as well as
financial management. The IRBM provided a portion of the budget for tax awareness programmes such as
for tax related advertisements on the radio, television and in newspapers. Expenditure under the tax services
programme showed a decrease of 34.04% as in 2014 it also included accrued expenses in respect of ESG for
IRBM staff who retired from 1997 until 31 March 2013.
Compliance Programme
Expenditure under the compliance programme covers all expenses for activities such as the drafting of
policies related to tax, investigations, audits on corporate tax, multinational company tax and petroleum
tax. Enforcement and investigation of tax related offences are the key to tax compliance in the country. This
programme is implemented by several departments and divisions under the purview of the headquarters.
Policy Programme
The policy programme includes activities related to the drafting of policies for tax operations within and outside
the country. It also covers legal functions such as the handling of court cases and legal advisory functions for the
IRBM. The programme incurred the lowest expenditure, only 1.61% of the total expenditure in 2015, and a large
portion of the expenditure went to staff cost, travel and subsistence expenses
Tax Operations Programme
The tax operations programme is the most important component in ensuring the efficiency of tax collection
in the IRBM. Activities under this programme include tax operation activities and revenue collection as well as
management of information technology. The largest expenditure for this programme involved computer and
data processing services. This expenditure ensures that the quality of the IRBM’s delivery system to its customers
is at its best at all times.
Management Programme
The management programme comprises activities involving the development of the organisation, human
resource management, conduct of courses and training as well as asset and the IRBM’s building management.
The IRBM also emphasises comprehensive training and continuous development of human resources. The
implementation of these activities is seen as a long-term investment for the IRBM to develop highly competent
officers to implement all the outlined functions.
State Programme
The State Programme contributes the largest expenditure in the IRBM, at 64.81% of the total expenditure.
More than 50% of the expenditure is related to staff cost. Activities under the State Programme include state
administration activities, tax audits, collection, stamp duty, investigations, detection, legal and customer services.

PERFORMANCE OF IRBM’S CAPITAL EXPENDITURE FOR 2015
In line with its new self-financing status beginning in 2015, the IRBM no longer receives developmental grants
through the Malaysia Plans from the government. The provision for development has been rebranded as the
provision for capital expenditure whereby the main funding comes from the agency fees received by the IRBM.
For 2015, the approved provision for capital expenditure was RM115,093,900 intended to fund the ICT Project
(RM108,116,500) and the Office Infrastructure Project (RM6,977,400).
The objective of the approved ICT Project is to establish a tax management system that is effective and efficient,
in line with the latest developments in technology. It was proposed as an online project to facilitate transactions
by taxpayers and indirectly has had a positive impact in terms of improvement to collection of taxes.
The Office Infrastructure Project was approved to provide the IRBM with its own office building and facilities
which are more comfortable and customer friendly, for both its officers and taxpayers.
OVERALL ACHIEVEMENT
Overall, the financial management of the IRBM was prudent and transparent with emphasis on attaining ‘value
for money’. All expenditures incurred were aimed at having a positive impact on the IRBM’s core function of
collecting income tax revenue for the country. The reduction in costs by 3% to RM1,963.94 million from those of
2014 (RM2,016.55 million) is a positive indication of good financial management in the IRBM, and is also consistent
with the IRBM’s performance achievements exceeding the set targets in all key performance indicators except
for revenue collection.
123

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2016 Publication

© Inland Revenue Board of Malaysia (IRBM) 2016

All rights reserved. No part of this publication may be

Malaysian National Library

Members of the Board 14

ACHIEVEMENT OF IRBM’s STRATEGIC OBJECTIVE KPI 2015

Achievement of KPIs of Strategic Objective #1 26

Achievement of KPIs of Strategic Objective #2 34

Achievement of KPIs of Strategic Objective #3 43

Achievement of KPIs of Strategic Objective #5 58

NATIONAL HIGHER EDUCATION FUND CORPORATION 70

FINANCIAL PERFORMANCE REPORT 115

4 ANNUAL REPORT 2015

Bismillahirrahmanirrahim 1. Collect due taxes fairly and equitably

TAN SRI DR. MOHD IRWAN

Praise be to Allah, with all His countless blessings the

Before I proceed, I would like to record my

8 ANNUAL REPORT 2015

2015 also saw the IRBM’s continued recognition

The prior significant contribution made by Malaysia

Perkhidmatan terbaik untuk anda

10 ANNUAL REPORT 2015

1. To provide the current year Income Tax Return Form for:

9. To take action on letters, faxes, and e-mails by issuing:

10. To answer telephone calls within 3 rings

To participate in meetings, discussions and agreements pertaining to domestic or international taxation

12 ANNUAL REPORT 2015

Administer repealed legislation to resolve outstanding cases such as:

IRBM’S CORE VALUES

TEAMWORK Work in a team

PROFESSIONAL Being professional

INTEGRITY Founded on integrity

EXCELLENCE To achieve excellence

5 DATUK MOHD NIZOM SAIRI

16 ANNUAL REPORT 2015 LAPORAN TAHUNAN 2015

CHIEF EXECUTIVE OFFICER/DIRECTOR-

DEPUTY CHIEF DEPUTY CHIEF DEPUTY CHIEF DEPUTY CHIEF

CORPORATE OFFICE OF FEDERAL OFFICE OF KEDAH/

OFFICE OF PENANG OFFICE OF

OFFICE OF NEGERI OFFICE OF FEDERAL

a. Secretary-General of Treasury who shall be the Chairman

18 ANNUAL REPORT 2015

a. Procurement Committees A and B

Risk Management and Internal Control

20 ANNUAL REPORT 2015

Collection Gross: Gross:

Company files (C/CS/TA/TC/TR): Company files (C/CS/TA/

Investigation Target number of cases: Number of cases resolved:

22 ANNUAL REPORT 2015

Modernise The IRBM’s 3,000,000 Tax Return 3,575,740 Tax Return

Training Implement Implemented

Collection of Direct Taxes

Tax reimbursement fund (TRF) 7.000 7.000 RM121.236

26 ANNUAL REPORT 2015

Withholding tax Stamp Duty

* IOFC (International Offshore Centre)

Collection by Method of Payment

*Payment Counter Bank Counter Internet Banking Others** Total