Manish Speaks, September 2021: HOW DO YOU KNOW IF YOU’RE CALCULATING YOUR TAXES RIGHT?

Tax season is not one of those anticipated times of the year given their arrival just after Lunar New Year festivities. While all departments get busy setting up targets for the upcoming fiscal year, having the tax filing responsibility of the whole office fall on a single employee in your finance team can be distressing. And a cause for concern too. Much as we hate keeping up with complicated income tax forms and the latest tax regulations, tax filing can’t be avoided. 

All companies seek a financial reputation that is in accordance with the law and want their employees to stay compliant on their tax filings as well. The annual tax season in Malaysia which falls in March and April is also a time when companies are firing on all cylinders to grow their business for the rest of the year. A busy time like this perhaps not always the best time to get tangled up in tax errors. There are also chances that you may not know an error has occurred. 

But does really that happen?

You’d be surprised but it does. 

A former client of ours that has now merged with a global automation company went with misreported expatriate tax for years until we discovered it. We noticed that the payroll of expatriate was grossed up for tax purpose and their tax agent was unaware of this. Thus, the grossed income was wrongly reported as total income with tax-on-tax allowance. This created double tax liability, costing the client more than a million ringgits every year. Propay Partners informed the client about this and the client managed to claw back tax refund for the past few years, rectifying tax reporting in the process.

At the time, the company was switching its global payroll outsourcing provider to a local partner and found us. The tax error was discovered at the same time and immediately addressed. But as this experience taught us, there may be several companies out there who might be misreporting taxes without the slightest clue that it’s already gone wrong. Not only will they be facing penalties later on but are also shelling out so much on tax payments every year!

Outsource Tax Filing to Get Guided Tax Reporting

Payroll and tax outsourcing may not be the first thought that comes into everyone’s mind, but it’s the most trusted solution that can work for delicate accounting matters. It saves your staff countless hours figuring out this from that and wondering what is taxable and what is not. During the course of a busy year, it takes away the frustration of having to deal with something that can otherwise easily be handled by tax experts.

How Tax & Payroll Outsourcing Can Help

Having a dedicated, reliable partner who takes care of all your employees’ tax and payroll needs can bring you greater relief from compliance issues with tax authorities. You can bring down inaccuracies and errors by a huge degree and also rely on the outsourcing partner to alert you on tax changes, exemptions, new clauses and the like. As they manage payroll as well, they will make sure every employee’s payroll is calculated with respect to their tax deductions and allowances. 

Choosing a Local Outsourcing Partner Over Global

Our client who misreported tax was under a global outsourcing vendor before they found us. Global outsourcing firms prefer partnerships with companies that have huge volume, thus reducing chances for smaller global ventures to find an outsourcing partner that meets their size and scale. Also, local partners have a much broader view of tax systems in Malaysia and can meet filing requirements to desired levels.

Employee Mobility Solutions for Expats

At Propay Partners, we specialise in expatriate tax and payroll requirements. Having served a variety of MNCs and their expat talents for the last 20 years, we make sure all expat requirements including immigration, insurance and visa formalities are done with minimal error and complete satisfaction.

To know more about our services, visit us at www.propaypartners.com