# Before You Leave Malaysia: The Tax Clearance Letter Your Employer Has to File First

> You can't just pack up and fly out. LHDN requires a Tax Clearance Letter (Surat Penyelesaian Cukai) before a departing employee's final pay is released — and the filing duty sits with the employer, not the person leaving. What the SPC process actually involves, and the wind-down checklist around it.

- Category: settling-in
- Language: en
- Status: published
- Updated: 2026-07-24
- Canonical: https://negaraku.md/en/settling-in/leaving-malaysia-tax-clearance

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You've handed in your resignation, booked the flight, and started giving away furniture. Then HR asks for something you've never heard of: a Tax Clearance Letter. Without it, part of your last paycheck doesn't move — and it isn't even you who's supposed to request it.

## The letter, and who actually files for it

The Tax Clearance Letter — Surat Penyelesaian Cukai, or SPC — is LHDN's confirmation that a departing employee's income tax position is settled. Most people assume this is something they, personally, apply for. It isn't.

Under LHDN's own rules, the **employer** files the request, using Form **CP21**, whenever a tax-chargeable employee is leaving Malaysia for more than three months — whether that's a permanent move home, the end of an overseas posting, or an open-ended relocation. The employer must submit it at least **30 days before the expected departure date**. Since 1 January 2024, that submission can only happen one way: online, through the **e-SPC** application on the **MyTax portal**. Manual paper filing at a counter is no longer accepted.

The practical effect: the first thing to check isn't a form you fill in yourself — it's whether your employer has already started the e-SPC process. If they haven't, and departure is a month away, you're already behind.

## What happens to your money in the meantime

Once LHDN receives the CP21, your employer is required to **hold back any money still owed to you** — final salary, unused leave payout, bonus, whatever's outstanding — for up to **90 days from the date LHDN received the form**, or until the SPC is issued, whichever comes first. Employers who release funds early, or who simply never file the notification, are committing an offence: a fine of **RM200 to RM20,000**, up to **six months' imprisonment**, or both.

That penalty falls on the employer, not you. But it's your money sitting in escrow, so confirm the filing actually happened rather than assume it's someone else's problem.

## The wind-down checklist

The SPC is the anchor everything else hangs off. Once it's moving, line up the rest of the exit in roughly this order:

| Task | Why it can't wait |
| --- | --- |
| Confirm employer has filed CP21 via e-SPC | Sets the 30-day clock and the 90-day withholding window |
| Settle any outstanding tax returns | LHDN clears your file only once your return position is current |
| Apply for EPF Leaving Country Withdrawal | KWSP's own document checklist expects proof alongside your passport and pass-cancellation records — start this well before your last week, not after |
| Cancel or let lapse your Employment Pass / work pass | A pass tied to an employer that's ceased sponsoring you needs formal closure through the Expatriate Services Division, not just non-renewal |
| Close or convert your bank account | Malaysian banks generally expect a forwarding arrangement or closure once residency and pass status end |
| Cancel SIM, utilities and tenancy | Routine, but easy to forget once the tax and immigration pieces are absorbing all the attention |

Foreign workers on a Temporary Employment Visit Pass also need a **Check Out Memo (COM)** from Immigration — since 1 September 2025, filed only through the MyPASS@JIM or FWCMS portals, with counter submissions no longer accepted. That's a distinct process from Employment Pass cancellation, so confirm which category applies to your pass before assuming either one covers you.

## Common mistakes

- **Waiting for HR to bring it up.** The CP21 duty is the employer's, but ask in writing whether it's been filed, early enough that a missed 30-day window doesn't become your problem at the airport.
- **Assuming "permanent departure" is the only trigger.** CP21 applies to any employee leaving Malaysia for more than three months, including a long secondment with no fixed return date.
- **Starting the EPF withdrawal after you've already left.** KWSP's leaving-country route expects paperwork that's easier to assemble while you're still in the country with access to HR and Immigration records.
- **Treating pass cancellation as automatic.** A lapsed Employment Pass and a formally cancelled one are not the same thing on Immigration's records, and the difference can matter on a future visit.

## What's next

For the employer's side of this same duty — the exact statutory timelines, the 90-day withholding rule in full, and what happens if it's breached — see [Tax Clearance: CP21, CP22A and the 90-Day Rule](/en/taxation/tax-clearance) and the [Offboarding Statutory Checklist](/en/employment/offboarding-statutory-checklist). If your pass is an Employment Pass specifically, see [Employment Pass](/en/employment/employment-pass-malaysia) for how sponsorship and cancellation work. And if you're on the opposite side of this move — just arriving rather than leaving — [Moving to Malaysia: The Order to Sort Out Your Pass, Entry, and First-Week Admin](/en/settling-in/moving-to-malaysia-first-steps) covers the same admin in reverse.

## Sources

- Pemberitahuan Pemberhentian Kerja (Notification of Cessation/Departure of Employee) — https://www.hasil.gov.my/majikan/pemberitahuan-pemberhentian-kerja/ (Lembaga Hasil Dalam Negeri Malaysia (LHDNM / HASiL))
- Garis Panduan Operasi Bil. 2/2024 — Prosedur Permohonan Surat Penyelesaian Cukai (SPC) Individu — https://www.hasil.gov.my/wp-content/uploads/20251101_garis-panduan-operasi-bil-2-tahun-2024-prosedur-permohonan-spc-individu.pdf (Lembaga Hasil Dalam Negeri Malaysia (LHDNM / HASiL))
- Leaving Country Withdrawal — https://www.kwsp.gov.my/en/member/account-centre/leaving-country (Kumpulan Wang Simpanan Pekerja (KWSP / EPF))
- Check Out Memo Applications Now Mandatory Online — https://www.imi.gov.my/index.php/en/pengumuman/elementor-164422/ (Jabatan Imigresen Malaysia (Malaysian Immigration Department))

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Source of truth: https://github.com/negaraku-md/NegaraKu.md
License: CC BY-SA 4.0