What Is Form CP204? A Comprehensive Guide for Businesses

Key Takeaways

• Form CP204 is Malaysia’s corporate tax estimate form (Borang Anggaran Cukai) required under s.107C ITA for companies, LLPs, trust bodies and co-operatives. 
• Deadlines differ for new vs existing: existing file ≥30 days before the new basis period; new entities file within 3 months of commencing operations (if first basis period ≥ 6 months). 
• From Year 2 onwards, your estimate must be ≥85% of the previous year’s latest estimate/revised estimate.
• You may revise via CP204A in the 6th, 9th, and (YA 2024 onward) 11th month of the basis period. 
• Instalments are monthly: existing entities start in month 2; new entities start in month 6. Each instalment is due by the 15th.

Form CP204, officially known as Borang Anggaran Cukai, is a tax estimate form issued by Malaysia’s Inland Revenue Board (LHDN). It requires businesses to declare their expected taxable income and pay corporate tax in monthly instalments.

For many companies, CP204 isn’t just another form. It’s about keeping cash flow steady, staying on LHDN’s good side, and avoiding unnecessary penalties.

Today, we will break down what Form CP204 is, who must file it, deadlines for new and existing businesses, how to calculate estimates, when to revise, and the penalties to avoid. Let’s begin.

What Is CP204 in Malaysia?

Form CP204, or Borang Anggaran Cukai, is Malaysia’s corporate tax estimate form required under Section 107C of the Income Tax Act 1967.

Its main purpose is to let businesses declare their estimated income tax liability in advance and pay it in monthly instalments. 

This system spreads out payments, reduces the risk of a year-end cash flow crunch, and gives LHDN  more predictable tax collections.

“The best way to think of CP204 is like a “budgeting tool” for your tax, you commit to paying bit by bit each month instead of one big lump sum.”

Who Must File and Pay CP204 in 2025?

Contrary to other popular sources, there is no RM20,000 threshold in s.107C. 

If you’ve commenced operations and you’re a company (Sdn Bhd/Berhad), LLP, co-operative society, or trust body, you must furnish CP204 and pay monthly instalments unless you fall under an exemption.

Entities That Must File

• Companies (Sdn Bhd / Berhad)
• Limited Liability Partnerships (LLPs)
• Co-operative societies
• Trust bodies

If you’ve commenced business, you’re in this bucket.

Exemptions & Special Cases

• Dormant / not yet started: Don’t furnish CP204 (but still file the annual tax return).
• First basis period under 6 months: No CP204 for that year.
• New qualifying SMEs: Exempt from furnishing estimates for the first 2 Years of Assessment after you start, if you meet SME conditions.

Example:

• A tech startup that commences operations and expects profit must furnish CP204 within 3 months (if its first basis period ≥ 6 months). 
• A dormant holding company that has not commenced operations need not furnish CP204 (still file the return).

If you’re not exempted, CP204 applies. If you don’t submit it, LHDN can issue CP205 (their own tax estimate), which often sets a higher amount.

When Is the CP204 Deadline for New and Existing Businesses?

The CP204 deadline depends on whether your business is newly established or already operating. Missing it can lead to penalties or an LHDN-issued CP205.

Deadlines For Businesses

• Existing businesses: File ≥30 days before the start of the basis period.
• New businesses: File within 3 months of commencement (if first basis period ≥ 6 months).
• From the second year onwards: CP204 deadlines reset to 30 days before each new basis period.

Submission Deadlines

* First instalment month shown for existing entities, new entities start in month 6. 

Payment Timeline (After Filing)

• Existing entities: instalments begin in month 2
• New entities: month 6. 
• All instalments are due by the 15th of the month.

Treat CP204 like renewing your road tax or business licence, you file before the new period begins, not after.

How Do You Submit Form CP204?

Form CP204 must be submitted to LHDN either online via e-Filing, through the MyTax portal. Just make sure to keep the acknowledgement after you submit.

Submission Methods

• e-Filing (preferred method)
  • Log in to MyTax Portal.
  • Select e-CP204.
  • Fill in company details, basis period, and estimated tax payable.
  • Submit electronically and keep the acknowledgement slip for your records.

What You’ll need

• Company/LLP details and tax reference number
• Basis period dates
• Your projected chargeable income and estimated tax
• Details of the authorised submitter (director, tax agent, or company secretary)

After filing, set up payments through ByrHASiL/FPX so you don’t miss the 15th of the month due date.

Note: Paper/manual submission is legacy and only used if LHDN specifically instructs you to do so.

How Much Do You Have to Pay Under CP204?

CP204 is simply your estimated corporate tax, split into equal monthly instalments for your basis period.

Which tax rates apply?

• SMEs that qualify: 15% on the first RM150,000, 17% on the next RM450,000, 24% on the balance.
• Non-SMEs (or SMEs that don’t meet the conditions): 24% flat on all chargeable income.

Sample CP204 Tax Estimates (SME rates)

Assumes a 12-month basis period. If yours is shorter/longer, divide by the number of months in your basis period.

Non-SME example:
If you don’t qualify for SME rates, apply 24% flat.

Example: RM500,000 × 24% = RM120,000 total tax → RM10,000/month (12-month basis).

Two rules to keep in mind

• Instalment timing: Existing businesses start paying in month 2. Newly-commenced start in month 6. Each instalment is due by the 15th.

   

• Minimum estimate (Year 2 onwards): Your new CP204 estimate must be at least 85% of the previous year’s latest estimate/revised estimate (not the final tax bill). This prevents under-estimating.

Read more: E-invoicing Malaysia Guidelines: What You Need To Know

How Do You Calculate CP204 Tax Estimates?

Your CP204 estimate is based on projected profits, Malaysia’s corporate tax rates, and compliance with the 85% rule. 

Getting it right is important, under-declaring can trigger penalties, while over-declaring locks up valuable cash flow.

Step 1: Estimate chargeable income

• Forecast your business revenue for the coming year.
• Deduct allowable expenses such as rent, salaries, utilities, and business overheads.
• This gives you your projected chargeable income.

Step 2: Apply corporate tax rates

• Apply 15%/17%/24% if you are a SME.
• For non-SMEs such as large companies, the tax rate is 24%.

Step 3: Check the 85% rule

• From the second year onwards, your CP204 estimate must be at least 85% of the previous year’s latest estimate or revised estimate. 
• This rule prevents businesses from underestimating to reduce monthly instalments unfairly.

Step 4: Divide into monthly instalments

• Split into equal monthly instalments for the number of months in your basis period (often 12 months).
• Payments are due on the 15th of each month starting from the second month of the basis period.

Example Calculation

SME example (qualifies for 15%/17%/24% bands):

Projected chargeable income = RM1,000,000

Tax: RM150,000 × 15% = RM22,500
  RM450,000 × 17% = RM76,500
  RM400,000 × 24% = RM96,000

Total tax = RM195,000 → Monthly = RM16,250 (12-month basis)

Non-SME example (24% flat):

Projected chargeable income = RM1,000,000

Tax = 24% = RM240,000 → Monthly = RM20,000 (12-month basis)

Filed the wrong CP204 amount? You can fix it

Made a mistake in your CP204 tax estimate? No problem, LHDN allows revisions through Form CP204A. 

This makes sure your tax instalments stay realistic and aligned with your business’s true financial performance, and spare you a letter from the tax man.

When Can You Revise?

• 6th month of your basis period
• 9th month
• 11th month

You can revise more than once in different windows, but from the second year onwards, your new estimate must still be ≥85% of the previous year’s actual tax.

How to Submit CP204A

1. Prepare updated figures (management accounts / forecasts).
2. Log in to MyTax (e-Filing) → select e-CP204A.
3. Enter revised tax estimate and effective month.
4. Confirm and submit, then save the acknowledgement.
5. Recalculate monthly instalments immediately.
   How Instalments Are Adjusted

Formula: New Monthly Instalment = (Revised Estimate − Amount Already Paid) ÷ Remaining Months

• If revised upwards, your remaining instalments increase.
• If revised downwards, your future payments reduce, and may even stop if you’ve already overpaid.

Scenario A: (Increase) – Revised in June (6th month)

• Original estimate RM120,000 → RM10,000/month. 
• Revised to RM260,000 in June. 
• Already paid RM50,000.
• New monthly = (260,000 − 50,000) ÷ 7 = RM30,000. 

Scenario B (Decrease) – Revised in November (11th month)

• Original estimate RM360,000 → RM30,000/month. 
• Revised to RM200,000. 
• Already paid RM240,000.
• New monthly = (200,000 − 240,000) ÷ 2 = RM0 (stop; RM40k credit). 

Common Reasons to Revise

• Big shifts in revenue (new contracts, lost clients).
• Cost increases/decreases (fuel, FX, supply chain).
• One-off items (asset sales, grants, impairments).
• Significant market or regulatory changes.

Mistakes to Avoid

• Missing the 6th/9th/11th-month windows.
• Failing to document justification (keep working papers).
• Ignoring the 85% rule from Year 2 onwards.
• Not updating payment instructions

(Formula basis: s.107C(7).)

Penalties for Late CP204 Submission or Payment

LHDN treats CP204 compliance seriously. Late filing or underpayment can lead to penalties, surcharges, and even prosecution.

• Failure to submit CP204: LHDN may issue Form CP205, its own tax estimate (often higher than yours).
• Late payment: A 10% surcharge is added to the unpaid instalment.
• Persistent non-payment: Legal fines or imprisonment under Section 120(1)(f) of the Income Tax Act.

How Do You Pay CP204 Instalments?

LHDN provides multiple payment methods for CP204 instalments, making compliance straightforward.

• FPX / Online Banking: ByrHASiL via FPX (online banking).
• Credit/Debit Card (ByrHASiL or at PPTH KL).
• Appointed bank counters/ATMs (using Bill Number or TIN).

CP204 vs CP204A vs CP205 What’s the Difference?

We mentioned a lot of forms, CP204, CP204A, CP205, and it can get confusing, so here’s a nice clean table of what they do in case you need a refresher.

• CP204 = Your plan.
• CP204A = Your adjustment.
• CP205 = LHDN’s punishment.

Does CP204 Affect Business Cash Flow? Yes 

For Malaysian SMEs, cash flow is king. CP204 may look like just another LHDN form, but it actually decides whether your business has enough to cover salaries, suppliers, or even the annual staff bonus.

Keeps payments predictable

Instead of one painful lump sum at year-end, CP204 spreads tax into 12 instalments, like paying your Astro bill. Easier to budget, less heart attack for your local audit firms.

Locks up your finance if you overestimate

File too high, and you’re basically giving LHDN an interest-free loan. That’s money you could use for stock, payroll, or have a nice chat with your marketing team.

Lets you breathe when times are tough

Business is a bit slow? Use CP204A to lower your estimate so you don’t overpay. That way, your monthly tax bill shrinks, freeing up cash for operations instead of draining your bank account.

“CP204 is like your Netflix plan. Times are good, you stay on premium. Times are bad, downgrade to basic. Either way, you’re still watching, and still compliant with LHDN.”

Conclusion: File CP204 Right and LHDN Will Thank You

Submitting Form CP204 may be a chore but it does help in keeping your business steady and on the right side of the law. 

Do it right, and you avoid nasty penalties, keep cash flow predictable, and stay on LHDN’s good side, which is everything a business could ask for.

But before you click off and get your CP204 form sorted, here’s a quick checklist to recap:

• File CP204 → 30 days before your financial year begins (or within 3 months for new businesses).
• Calculate properly → Apply 15%/17%/24% (SMEs) or 24% flat (non-SMEs)
• Pay on time → Instalments are due on the 15th of each month.
• Revise if needed → Use CP204A in the 6th, 9th, or 11th month.
• Avoid CP205 → Don’t skip filing, or LHDN will issue their own estimate (often higher).
• Automate payments → FPX or auto-debit reduces the risk of missed deadlines.

If all of this is confusing (and it is), why not enlist the help of professionals like us? At Accounting.my, we help businesses file CP204 correctly, stay compliant with LHDN, and keep their finances running smoothly with our professional tax services.

Let us take the stress out of compliance so you can focus on growing your business.