Late Return Filing

Failure to file a return by the deadline will result in a penalty of MWK 300,000, plus MWK 50,000 per month, or part of a month, the failure continues. In addition, late payment penalties may apply.

Late Tax Payment

Failure to pay tax by the deadline will result in a penalty of 20% of the amount outstanding in the first month, plus interest on the amount outstanding equal to 5% plus the prevailing bank lending rate per annum for each month, or part of a month, the tax remains unpaid.

Failure to pay sufficient provisional tax results in penalties of 25% or 30%, respectively, where the unpaid tax (as a percentage of the total tax liability) exceeds 10% but does not exceed 50%, or exceeds 50%.

Incorrect Returns

Filing of incorrect returns may result in a penalty of 20% of the amount of tax unpaid as a result of an omission of income, an unlawful deduction/offset, or an undue allowance claim, plus interest on the amount unpaid equal to 5% plus the prevailing bank lending rate per annum for each month, or part of a month, the tax remains unpaid.

If the above violations are committed with the intent to defraud, a penalty of MWK 200,000 or twice the amount of tax due or imprisonment for one year may be imposed. Further, assistance in preparing an incorrect return may result in a penalty of MWK 200,000 in the first month or part of a month plus an additional MWK 10,000 for each month or part of a month that the penalty remains unpaid.

Effective 22 November 2019, a penalty of 6% has been introduced on the amount adjusted by the Commissioner-General following a tax audit.

Failure to Withhold Tax

Failure to deduct withholding tax or submit the tax withheld will result in a penalty of 20% of the amount of tax unpaid. The same penalties as above apply if the failure is with the intent to defraud.

Failure to Comply with a Notice and Keep Records

Failure to comply with a notice, giving incorrect information, failing to keep records, books, or accounts, etc. will result in a penalty of MWK 200,000, plus MWK 50,000 per month, or part of a month, the failure continues.

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