What is the Malaysian Income Tax Reporting System (MITRS)?
In Malaysia, publicly listed companies must prepare and submit XBRL financial reports with SSM. The aim of adopting XBRL for financial reporting was to facilitate storing, sharing, and using business data. Apart from financial reporting, Malaysia adopted XBRL for tax computation to achieve a higher tax return compliance rate.
IRBM (the Inland Revenue Board of Malaysia) or LHDNM (Lembaga Hasil Dalam Negeri Malaysia) introduced an online platform to submit tax working sheets electronically, known as the Malaysian Income Tax Reporting System (MITRS). It was developed using the XBRL (eXtensible Business Reporting Language) format, an international standard for digitally sharing financial reports of businesses, replacing paper-based reporting.
The LHDNM issued the XBRL taxonomy framework to reflect information requirements for tax return forms and support tax working sheets. The tax working sheets contain 3 categories: working sheet, financial information, and sole proprietorship financial information (SPFI).
Companies, sole proprietorships, partnerships, associations, and cooperative societies in Malaysia must prepare and submit tax working sheets using MITRS. You can access MITRS using an e-filing digital certificate.
Preparing and Submitting Tax Working Sheets Using MITRS
You can prepare and submit tax working sheets using MITRS via two methods:-
Fill in Web Form
- Fill in the related tax working sheets online.
- Validate the working sheets online.
- After validation, submit the sheets using a digital certificate online.
- A QR code will be generated to confirm the submission.
- Save and print the tax working sheet.
- Save and print the confirmation of receipt of the working sheet.
Import Instance
- Download the LHDNM taxonomy file and generate instances using either the XBRL tools or special software (self-developed by the company/ software provider).
- Next, upload the instance into MITRS.
- Validate the working sheets online.
- After validation, submit the sheets using a digital certificate online.
- A QR code will be generated to confirm the submission.
- Save and print the tax working sheet.
- Save and print the confirmation of receipt of the working sheet.
MITRS Implementation
The taxonomy for preparing and submitting tax working sheets using MITRS was announced and published in February 2019. The implementation of MITRS began in phases beginning on 1 September 2020. In the first phase, the submission of tax working sheets is only applicable for Malaysian companies under audit or investigation. The company involved is given an option but encouraged to submit tax working sheets through MITRS because it is user-friendly, saves time, and guarantees data protection.
The phases for submitting tax working sheets by sole proprietorships, partnerships, associations, and cooperative societies under audit or investigation are yet to be announced.
Bottom Line of MITRS
MITRS was introduced by IRBM to help companies save a lot of time while submitting their tax working sheets. To know more about MITRS, you can email at HelpITMITRS@hasil.gov.my. You can also visit the DataTracks blog to learn more about XBRL adoption by Malaysian companies.