What is tax corporate governance framework?

What is tax corporate governance framework?

A strong tax governance framework establishes the techniques and processes within the organisation to identify tax risks, assess risks and sets out the appropriate actions to mitigate the impact of those tax risks.

Objective of TCGF

The purpose of corporate governance is to facilitate effective, entrepreneurial and prudent management that can deliver the long-term success of the company. Corporate governance is the system by which companies are directed and controlled. Boards of directors are responsible for the governance of their companies.

Background

The Inland Revenue Board (IRB) has launched the Tax Corporate Governance (TCG) Framework during the opening ceremony of the IRB's 26th Hari HASiL celebration and has recently published the TCG Framework and the TCG Guidelines. The introduction of the TCG Framework is part of the IRB’s initiative towards adopting a co-operative tax compliance that is both fair and effective in Malaysia.

Benefits of TCGF

Organisations will be able to enjoy the following benefits upon their participation in the TCG Programme :

I. Reduced scrutinization of compliance activities.

  •  Lesser tax audits will be conducted.

  •  Higher materiality or reduced sample size.

II. Expedite tax refunds.

 Accelerate tax refund process for compliant participants, provided no anomalies are

noted the best endeavour will be given to expedite refunds.

III. Appointment of a dedicated tax officer.

 A single point of contact between the taxpayer and the IRBM.

IV. Expedite any ongoing dialogue on technical matters.

  •  Priority consideration

  •  Eligible to be granted priority consideration for compliant participants, which are:

- Consideration will be given accordingly in respect of tax penalty rates.

- Step down of compliance activities.

TCGF at a glance

TCG is suitable for all sizes and types of businesses that give priorities and resources to corporate governance matters.

TCG Programme is currently being implemented as a pilot project. However, the interested organisations are advised to adopt and execute the framework.

TCG in Malaysia is currently being implemented as a pilot project. Therefore, selected organisation will receive an invitation from IRBM to join the programme.

Other interested organisations may contact IRBM via tcg@hasil.gov.my to communicate their interest.

Once an organisation is accepted into the programme, the TCG status will be valid for 3 years subject to terms and conditions stated in the offer.

There will be no fees charged to participate in the programme.

These expenses are capital in nature and not allowable for tax deduction under subsection 33(1) ITA 1967.

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