What is a stoppage order for tax defaulters?

A stoppage order is a travel ban order at international exit points imposed by the Director General of Inland Revenue Board of Malaysia (Malay: Jabatan Hasil Dalam Negeri Malaysia (JHDNM)) on individuals or company directors who fail to settle the balance of income tax, real property gains tax or corporate tax.

It prevents tax defaulters from leaving the country.

Stoppage order is enforced under Section 104 of the Income Tax Act 1967 [Act 53] and Section 22 of the Real Property Gains Tax Act 1976 [Act 169].

A certificate of stoppage order will be issued to:
  1. Royal Police Malaysia; or

  2. Immigration Department of Malaysia; and

  3. tax defaulter by registered post to the last known address.

If a tax defaulter does not receive or acknowledge receipt of the notice, the stoppage order will not be invalidated.

A stoppage order will be revoked by the Director General of Inland Revenue Board of Malaysia if full payment of the amount stated on the certificate is paid.

You are advised to check with the Immigration Department of Malaysia Control Status Checking before the date of departure to ascertain whether or not an order has been invoked to prevent you from leaving Malaysia.

Temporary Release

If you are unable to pay in full, you can apply for temporary overseas travel release when you settle 50% of the total outstanding tax amount and make payment arrangement for the remaining balance.

Application must be made at least 7 days before travelling abroad.

You must visit the Inland Revenue Board of Malaysia branch which handles your tax file, in person or through a representative, to submit an application for temporary release stating your travel destination details, travel purpose and duration of visit.

If you are in financial distress, you may require to submit your latest bank statement and cash flow to support your application.

You must settle the amount agreed by the Inland Revenue Board of Malaysia within 5 working days and produce your payment receipt to the branch office to show the amount you paid.

You can make payment through cash, internet banking, bank counter or the Inland Revenue Board payment counter or online payment service, ByrHasil.

Your application will then be approved and a temporary release letter will be issued to you specifying the period you are allowed to travel overseas.

If only partial payment of the 50% is made, your application will only be forwarded to the Director General's office for consideration.

Once you have obtained the temporary release letter, you need to proceed to the Immigration Department of Malaysia to obtain a Facility Letter.

To avoid any inconvenience when you're traveling, bring along the Facility Letter during departure.

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Knowledge Base ID :   1589
Last Reviewed :   April 8, 2017
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