Cover image via 
Follow us on Instagram, TikTok, and WhatsApp for the latest stories and breaking news.
The Inland Revenue Board (LHDN) has revealed that it identified 14,858 Malaysian tax residents holding more than RM10 billion in overseas financial accounts that were never declared in their income tax filings
In a statement on Monday, 2 February, LHDN said the discovery was the result of a coordinated international effort to clamp down on cross-border tax non-compliance.
So how did LHDN find them?
The agency said the information came through the exchange of international financial account information involving more than 100 countries.
According to LHDN, the collaboration was carried out in line with international tax transparency standards, allowing tax authorities to identify offshore income and assets that may not have been reported in taxpayers' annual filings.
Through this process, LHDN was able to flag Malaysian tax residents with significant balances in foreign financial accounts that were not declared via their Income Tax Return Forms (BNCP).
LHDN identified offshore accounts in several major financial hubs and tax havens
The agency said the undeclared accounts were linked to jurisdictions commonly associated with international finance and offshore wealth management.
Among the countries mentioned were Luxembourg, Hong Kong, Guernsey, the Cayman Islands, the Bahamas, and Bermuda.
Here's what LHDN uncovered from the data exchange:
- 14,858 Malaysian tax residents with overseas financial accounts
- More than RM10 billion in total account balances
- No corresponding tax declarations made through BNCP for the relevant income or assets
LHDN said these cases point to potential non-compliance involving income and assets that should have been taxed in Malaysia.
While the agency did not provide a breakdown, each offshore account has an average of more than RM6.6 million.
What happens next?
For now, LHDN says it is taking a "nudging" approach rather than moving straight to enforcement, by issuing reminders to the individuals involved.
"LHDN has issued reminder notices to the relevant tax residents as a voluntary compliance encouragement measure, while also providing an opportunity for them to review and declare their income before any enforcement action is taken," the statement read.
The agency also urged Malaysian tax residents with undeclared foreign income or overseas financial accounts to come forward voluntarily.
"Malaysian tax residents who have undeclared income and foreign financial accounts from sources of income that should be taxable in Malaysia are encouraged to come forward voluntarily in the near term to make proper reporting and compliance."
However, LHDN made it clear that those who ignore these reminders could face penalties and legal action under the Income Tax Act 1967.
The agency said voluntary disclosure could help affected individuals avoid harsher consequences
LHDN said the move reflects its commitment to running the country's tax system in a way that is transparent, fair, and aligned with international standards, especially as cross-border financial activity becomes harder to track without global cooperation.
The agency added that strengthening tax compliance is essential to protecting public revenue and ensuring the tax system remains equitable for all taxpayers.
Meanwhile, the Malaysian Anti-Corruption Commission (MACC) said it's open to jointly investigating with LHDN the offshore accounts for potential corruption
According to the New Straits Times, MACC chief commissioner Tan Sri Azam Baki said that cooperation between agencies would be crucial for tracing suspicious fund flows, particularly where tax evasion may intersect with corruption, abuse of power, or money laundering.
"We do not know which companies are on LHDN's radar," Azam was quoted as saying.
"We are willing to conduct joint investigations on corruption-related issues if LHDN is willing to share information with us."
