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When to Claim Tax Agent & Statutory Filing Fees: Avoid Common Mistakes in YA 2024
As we approach tax season, many business owners and finance teams ask:
“Can we deduct tax agent and statutory filing fees in the current year of assessment?”
Let’s clear up the confusion.
Tax Deduction Rule: “Incurred Basis” Applies
Under Malaysian tax law, expenses are only deductible when they are incurred — not when they relate to.
“Incurred” means the work has been done and the business is legally liable to pay.
So even if the expense is for YA 2024, if the service (e.g. tax filing or statutory submission) is only performed in 2025, it can’t be deducted in YA 2024.
Common Examples
| Fee Type | When Service is Rendered | Claim in YA | Notes |
| Tax Agent Fee (for YA 2024 filing) | 2025 | YA 2025 | Add back in YA 2024 |
| CP204 (Tax Estimate Submission) | 2025 | YA 2025 | Only deductible once service is performed |
| Form E & EA (Employer Filing) | 2025 | YA 2025 | Even though it relates to 2024 salaries |
| Monthly Payroll Processing | Monthly (e.g. Jan–Dec 2024) | YA 2024 | Deductible if billed monthly |
FAQs: Tax Agent & Statutory Submission Fees
Q1: Why can’t we deduct tax agent fees in YA 2024?
A: Because the fees are only incurred when the service is completed — usually in 2025. Tax deduction is based on when incurred, not what year it relates to.
Q2: We paid a deposit to our tax agent in Dec 2024. Can we deduct it?
A: No, unless the services were also completed in 2024. Prepayments are not deductible until the work is done.
Q3: What if the invoice date is 2024?
A: Invoice date alone is not enough. You must check when the services were actually performed.
Q4: Can we claim monthly payroll processing fees in YA 2024?
A: Yes — if services are rendered monthly (e.g. Jan–Dec 2024), those are deductible in YA 2024.
Q5: Do we need to “add back” the expense in YA 2024 tax computation?
A: Yes. If you’ve accrued or provisioned for 2025 services in 2024, you must add back the expense to avoid over-claiming.
What You Should Do
- Review year-end accruals for tax agent, CP204, and Form E/EA services.
- Ensure only expenses incurred by 31 Dec 2024 are claimed in YA 2024.
- Add back unpaid or unrendered services in tax computation.
- Claim next year when the service is completed and invoice is final.
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