He said the doctors could appeal to the Special Commissioners of Income Tax.

“The doctors have a case, but they must first put their representation in writing,” he told FMT when asked about the doctors’ complaint.

If the Inland Revenue still refuses to accept the representation, then they should lodge an appeal to the Special Commissioners within 30 days upon the issuance of the assessment.”

The doctors’ case was made public on Friday when Malaysian Medical Association president Dr Ashok Zachariah Philip said the Inland Revenue had accused several doctors of making wrongful declarations about their income.

For tax planning purposes, the affected doctors had set up their own companies to provide medical services to hospitals; however the contracts were in their own names, Dr Philip said. The Inland Revenue held that their income had been wrongly declared, backdated five years, and was applying 100 percent penalties.

However lawyer Saravana, a partner with Lee Hishammuddin Allen & Gledhill, said how the doctors conducted their business was up to them as long as the business was legitimate and recognised by the MMA.

“If the IRB wants to make adjustment they must have a basis supported by law and facts. Just because the doctors exercise their practice the way it is now, doesn’t mean their practice arrangement and any tax mitigation arising from such arrangement amounts to tax avoidance or tax evasion,” he said.

The doctors should consult tax lawyers alongside their tax agents and accountants to ensure all of their legal rights are reserved.

He noted that the courts had on many occasions held that the IRB could not dictate to taxpayers how to run their business.

The MMA is holding a meeting today with the Association of Private Hospitals Malaysia, the Bar Council and a few accounting bodies to seek their expertise on the issue.

• MMA to meet experts on claims of docs’ undeclared income