There are penalties imposed by LHDN without notice or notification, one of it is under Section 107C(9), of the Income Tax Act, 1967.
Penalty S 107 C (9) is imposed for amount of unpaid tax instalment, CP204, without any notification to tax payer or tax agent.
The penalty is 10% of the unpaid amount.
It is the responsibility of the tax payer to pay the tax instalment within the 15th day of each calendar month.
Below is the extract from the Income Tax Act, 1967, S 107 C (9);
"Where any instalment due and payable has not been paid by the due date or on the date specified by the Director General, the amount unpaid shall, without any further notice being served, be increased by a sum equal to ten per cent of the amount unpaid, and that amount unpaid and the increase on the amount unpaid shall be recoverable as if it were tax due and payable under this Act."
The penalty will be captured by the LHDN system automatically, there is no rulings on the timing of when this penalty will appear in the tax status of tax payer.
LHDN do not send statement of tax status to tax payer or tax agent in a regular basis. The statement of tax status can be obtained from LHDN only upon formal request is made by tax payer or tax agent, due to the confidentiality.
Conclusion: The only way to avoid this penalty is by paying the instalment within the due date, on or before 15th day of each calendar month.