Each year, when employers prepare Form EA and submit Form E, the same issue comes back again and again. It is not about the forms. It is about what was missed in payroll during the year.

The most common trigger is Benefit in Kind, BIK, and perquisites.

Many SME owners tell us, “This is small staff benefit only.”
IRB does not see it as small when it affects PCB and taxable income.

This is where the exposure usually hits.

First, PCB audit.
If BIK or perquisites were not included in monthly PCB calculations, IRB may treat it as under deduction. The employer may be required to pay additional PCB, and in many cases, compounds follow.

Second, company tax audit.
Where the expense is personal in nature or not properly supported, IRB may disallow the deduction. The amount is then added back in the tax computation.

One item can trigger two outcomes.
Payroll exposure and corporate tax exposure.