Tax Law

Most Malaysians know that you can appeal your tax assessment if you think the Inland Revenue Board (LHDN) got it wrong. But many people do not know who actually decides those appeals and how the hearings work.

This article explains , in plain language , the roles, procedures, and powers of the Special Commissioners of Income Tax (SCIT) under the Income Tax Act 1967.

What Happens After You File a Tax AppealWhen a taxpayer disagrees with a tax assessment issued by the Inland Revenue Board (LHDN), the case can eventually go before a special panel known as the Special Commissioners of Income Tax. Think of them as the “judges” of Malaysia’s tax world — independent decision-makers who make sure both sides are treated fairly. They’re formally addressed as “Yang Arif”, just like judges in court. They have almost the same powers as a Sessions Court, which means they can summon witnesses, examine evidence, and make binding decisions.

When you file your taxes, you expect the Inland Revenue Board (LHDN) to process your return correctly. But sometimes, you may receive a notice of assessment that you believe is wrong — maybe your income was overstated, or a deduction was missed. The Malaysian Income Tax Act 1967 gives you the right to challenge such assessments through a formal appeal process. While the law uses technical language, the procedure itself follows a clear and logical path. Let’s walk through it step by step.

The Special Commissioners of Income Tax (SCIT) serve as an independent tribunal established under the Income Tax Act 1967. Often regarded as Malaysia’s “tax court,” the SCIT is the first level of appeal for taxpayers who wish to challenge assessments made by the Inland Revenue Board (Lembaga Hasil Dalam Negeri, or LHDN).

Understanding Industrial Building Allowance (IBA) Under the Malaysian Income Tax Act 1967The Industrial Building Allowance (IBA) is one of the key tax incentives available to businesses in Malaysia. It allows companies to reduce their taxable income by claiming deductions for the cost of constructing or purchasing qualifying industrial buildings. This incentive is designed to encourage long-term investment in industrial and productive infrastructure.