Streamlining Tax Clearance Letter (SPC) Applications via e-SPC for Employers
Starting in 2024, the Inland Revenue Board of Malaysia (IRBM) is rolling out new rules for applying for Tax Clearance Letters (SPC) via the e-SPC system. This article provides an overview of the new guidelines and the responsibilities that employers need to fulfill when handling SPC applications through the e-SPC system.
Individual SPC Application Guide
As of April 1, 2024, IRBM has released a new comprehensive guide for the application of individual SPCs by employers. This guide can be accessed through the IRBM Portal under the Employment Termination section. Employers are advised to ensure that their handling of employee termination services aligns with this new guideline to avoid discrepancies and ensure smooth processing.
Exemption Criteria for SPC Applications
Employers should note that not all employees require an SPC upon termination of employment. IRBM has clarified that employers are exempt from applying for an SPC for employees who meet the following criteria:
- The employee’s monthly income is below the minimum amount required for monthly tax deductions (PCB) and they do not receive any compensation or remuneration beyond this; or
- The employee’s income has already been subjected to tax under the 1994 Income Tax (Deduction From Remuneration) Rules, and they do not receive any additional compensation or remuneration.
New CP22A/CP22B Formats for Group Submission
From September 1, 2024, all group submissions of CP22A or CP22B forms through the e-SPC system must use the new format introduced by IRBM. Employers should ensure that they are familiar with these updated formats and prepare their submissions accordingly.
Amendments and Additions to SPC Applications
Starting August 1, 2024, any changes or additions to SPC applications must be made through the e-SPC system. Manual submissions will no longer be accepted after September 1, 2024.
