Address 7.


79 views
Uploaded on:
Category: Home / Real Estate
Description
Barring organization just on individual pay. Salary RECEIVED IN MALAYSIA FROM OUTSIDE ... YA 2004 - Business, association and cooperatives (800,000) ...
Transcripts
Slide 1

Address 7 Tax Planning: Concept, Planning and Calculation

Slide 2

LEGISLATION Income Tax Act 1967 Real Property Gains Tax Act 1976 Lembaga Hasil Dalam Negeri (LHDN) Inland Revenue Board (IRB) Corporatised on March 1, 1995

Slide 3

PERSONAL TAXATION Employment Sole Proprietorship Partnership

Slide 4

SCOPE OF CHARGE Territorial idea Income of any individual Accruing in (right to get) Deriving from (who pays you – government and state government, installment from duty inhabitant, charged as friendly costs) Received in Malaysia From outside Malaysia

Slide 5

DEFINITION OF PERSON Individual Company Body of people Corporation sole Excluding association – just on individual pay

Slide 6

INCOME RECEIVED IN MALAYSIA FROM OUTSIDE MALAYSIA Taxable Income Resident individual/assortment of people/organization Resident organizations including 4 particular ventures: keeping money, protection, delivering and air transport Tax Exempted Non-occupant (under Schedule 6 para. 28) Resident organization - pay charge (exclusion) Unit Trusts Offshore Companies (LOBATA 1990)

Slide 7

RECENT TAX DEVELOPMENTS Historically Preceding year premise (PYB) 1/1/98 to 31/12/98 Year of appraisal 1999

Slide 8

CHANGE OF ASSESSMENT SYSTEM Preceding year premise (PYB) to ebb and flow year premise (CYB) Effective date Year finished 31/12/2000 Financial year in 2000

Slide 9

BASIS PERIOD Current year premise Calendar year 1/1/2000 to 31/12/2000 Year of evaluation 2000 Financial year 1/7/1999 to 30/6/2000 Year of evaluation 2000

Slide 10

BASIS YEAR 2000 Current year premise (CYB) 1/1/1999 to 31/12/2000 Year of evaluation 2000 1/1/2000 to 31/12/2000 Year of appraisal 2000

Slide 11

TAX IMPLICATIONS – SHIFT TO CYB Year of appraisal 2000 2 premise periods Basis period in 1999 Tax waiver year Income charge (revision) Act 1999

Slide 12

TAX WAIVER YEAR Income earned in 1999 No duty payable Exceptions Dividend Payment subject to withholding charge Non-national/non-inhabitant people who initiate or stop work in 1999

Slide 13

SELF-ASSESSMENT Effective Date 1 January 2000 Year of appraisal (YA) 2001 YA 2001 - Companies (220,000) YA 2004 - Business, organization and cooperatives (800,000) YA 2004 – Employment (1,800,000)

Slide 14

CLASSES OF INCOME – SECTION 4 (RESIDENTS OR NON-RESIDENTS) Business Employment Dividends, premium or rebates Rents, eminences or premium Pensions, annuities or other periodical installments Gains or benefit outside of (a) to (e)

Slide 15

SPECIAL CLASSES OF INCOME – SECTION 4A Recipients: Non-occupants Withholding charge – installment/credit Services utilization of property/rights Installation/operation of plant + hardware Technical guidance/administrations/help/administration/organization Rent – portable property

Slide 16

PAYMENTS TO NON-RESIDENT – WITHHOLDING TAX

Slide 17

INCOME VS CAPITAL

Slide 21

* self, mate + tyke # self, mate, youngster + guardian

Slide 22

COMPUTATION OF TAX PAYABLE Tax Payable = Chargeable Income X Relevant Tax Rate Tax Rates Resident individual/club/exchange affiliation/co-agent society Scale rates : 0% to 28 % Company Trust – 28 % Non-occupant individual – 28 % (total wage = chargeable pay)

Slide 23

TAX COMPUTATION FORMAT Business X TOTAL INCOME XX Employment X Less: Personal Reliefs (X) Investment Income X Chargeable Income XX Other Sources X TAX PAYABLE XX Aggregate Income XX Less: Rebates (X) Less: XX Basis Year Loss (XX) Less: DTA Reliefs (X) Approved Donation/ Sec 110 Set-off (X) Subscription (X) TAX PAYABLE/REPAYABLE XX TOTAL INCOME XX

Slide 25

PERSONAL REBATES Set-off against expense payable Chargeable pay < RM35,000 Single (RM350) Separate Assessment Husband (RM350) Wife (RM350)

Slide 26

PERSONAL REBATES Combined appraisal Husband (RM350) Wife (RM350) Personal Computer RM400 (like clockwork) Employment Levy Religious Payments Zakat/Fitrah

Slide 27

DERIVATION – SECTION 13(2) Exercised in Malaysia Leave owing to job in Malaysia Overseas obligations coincidental to job in Malaysia Director of occupant organization Employment on board ship/air ship

Slide 28

TYPES OF EMPLOYMENT INCOME Salary, compensation, expense, reward, compensation, leave pay, commission, tip, perquisite, recompense Benefits-in-kind Living convenience Non-endorsed annuity plan/provident asset Compensation installment

Slide 29

GRATUITY Tax excluded sick wellbeing 55 years + 10 years of administration Taxable Period of occupation 6 years of appraisal Whichever is shorter

Slide 30

ASSESSMENT - Gratuity – RM60,000 Employment period 5 years RM12,000/for each YA Employment period 7 years RM10,000 for each YA

Slide 31

SHARE OPTIONS Not-Taxable Option not practiced Taxable Option practiced Option date Difference between business sector worth and choice business sector

Slide 32

BENEFITS-IN-KIND Motor vehicle Private use - RM1,200 to RM25,000 Fuel – RM600 to RM3,000 Driver – RM3,600 Accommodation (30% of real) Household furniture Barely-outfitted, semi-outfitted, completely outfitted, administration charges, utilities installment and so forth

Slide 33

LIVING ACCOMMODATION Job necessity Tax absolved Hotel/lodging 3% X Sec 13 (1) (an) Apartment/house Lower of 30% Sec 13(1)(a) or Actual rental (empty settlement) Mobile telephone, plant specialist, hirelings, school/educational cost charges, club enrollment, staff advance

Slide 34

LIVING ACCOMMODATION Salary RM100K Defined quality – unfurnished : RM36K/24K Assessability of Benefits Salary RM100K Lower of 30% X RM100K or RM36K/24K RM30K/24K Gross Income RM130K/124K

Slide 35

TAX EXEMPT - BIK Discounted merchandise and administrations Subsidised nourishment and beverages Free transport Child care advantages Medical/dental Leave entry Group protection approach

Slide 36

APPROVED FUND/SCHEME EPF Contributions 11% (Employee) 12% (Employer) Tax deductibility – 19% Reduction in Cash Remuneration Lower charge risk Cash stream Time estimation of cash

Slide 37

RESIDENT STATUS – INDIVIDUAL :SECTION 7 > 182 days <182 days however connected to another time of 182 days or more Temporary nonappearance Incidental to job, meeting/study/course, sick wellbeing, social visits (<14 days) 90 days – promptly going before 3 years < 90 days instantly taking after year – inhabitant Immediately going before 3 years - inhabitant

Slide 38

SECTION 7(1)(B) Aug.1999 Aug. 2000 A B Period A -< 182 days Period B -> 182 days Period A connection to Period B Link -31 Dec. to 1 Jan. in Malaysia Period A qualifies as occupant

Slide 39

SECTION 7(1)(B) April 1999 March 2000 A B Period A -> 182 days Period B -< 182 days Period A connection to Period B Link -31 Dec. to 1 Jan. in Malaysia Period B qualifies as inhabitant

Slide 40

SECTION 7(1)(C) YA 1999 150 days 1998 92 days 1997 RESIDENT 1996 15 days 1995 138 days Qualifies as occupant

Slide 41

SECTION 7(1)(D) YA 1999 Resident 1998 63 days 1997 Resident 1996 Resident 1995 Resident Qualifies as occupant

Slide 42

CAPITAL GAINS Real Property Gains Tax (RPGT) Act, 1976 Effective date – 7/11/1975 Disposal of genuine property or shares in a genuine property organization Replaced Land Speculation Tax Act 1974

Slide 43

ACQUISITION/DISPOSAL DATE Acquisition date = transfer date Written understanding (S & P) Completion date Asset exchanged Full thought paid or got Conditional contract

Slide 44

CHARGEABLE GAIN OR ALLOWABLE LOSS Disposal Price > Acquisition Price = Chargeable Gain Disposal Price < Acquisition Price = Allowable Loss

Slide 45

TAX RATES

Recommended
View more...