Many salaried employees have been left confused after receiving the Inland Revenue Board’s (LHDN) 2026 tax instalment notice (CP500), despite earning only monthly wages that are already subject to scheduled tax deductions (PCB) and having no additional income.
The CP500 is a tax instalment scheme meant for individuals with non-employment income such as business profits, rental income or royalties. Payments made under the CP500 at the beginning of the year are treated as advance tax and are later offset against the final tax assessment issued by LHDN at year-end.
According to a report by The Star, a 28-year-old pharmaceutical industry employee from Shah Alam, identified only as Ms Lee, said she was puzzled by the notice as she has no source of income apart from her salary.
“I already have monthly PCB deductions, so I don’t understand why I received a CP500 notice and was asked to pay instalment tax. I don’t know what to do and may have no choice but to pay first. My income is just enough to get by,” she said.
She also questioned how the tax authority concluded that she had additional income.
Ms Lee said friends told her the notice could be linked to an error in how her bonus was declared or categorised during tax filing.
“I think I will go to LHDN personally in the next few days for peace of mind,” she added.
Similar concerns were raised in the comments section of a Facebook post by chartered accounting firm Syafiq Suhaimi & Co regarding CP500 notices. Several netizens reported receiving the notice despite being salaried employees.
One user, Rashin, said he received a CP500 notice for 2026 even though he does not run any business. Another netizen, Hafiz, said he also received the notice despite having only salary income and filing his taxes regularly.
In response, the accounting firm advised affected taxpayers to submit a revised CP500 form or visit the nearest LHDN office to apply for the cancellation of the notice.
