When tax arrears must be paid, dead or alive

 

The people might lose motivation about paying tax arrears if they know the arrears will be written off eventually, says a deputy minister. (Bernama pic)

PONTIAN: The government does not plan to amend the section in the Income Tax Act which stipulates that the administrator or next of kin of a deceased income taxpayer has to pay the tax arrears.

Deputy finance minister Ahmad Maslan said if the law was not enforced on the executors and heirs, the people’s motivation and sense of responsibility to pay their taxes would decline.

“We believe there are parties who will be unmotivated to pay taxes. They will wait till they die because then all debts do not need to be paid and their debts with LHDN (the Inland Revenue Board) are settled.

Ads by Kiosked

“The matter is already in the Act. If the heirs can pay the tax, they should do so,” he said.

Section 74 of the Income Tax Act stipulates that any income tax arrears cannot be automatically written off even if the individual involved is certified dead.

On Wednesday, religious affairs minister Na’im Mokhtar reportedly said the muzakarah committee of the National Council for Islamic Religious Affairs would meet soon to reach a consensus on the payment of outstanding taxes by a deceased person, following differences of opinion on the matter between two state muftis. - FMT