The most discussed subject in the month of April is "income tax". This is because most of the people work as an employee and the deadline for submission and payment falls on 30th April. Everyone will be busy searching the EA form and receipts to do the tax computations.
Income Tax is an amount of money which is taken from your earnings to help towards some of the cost of services we receive in this country. Everyone who earns or receives income exceeding a certain amount will be required to pay income tax. The tax payable for a tax year (a year of assessment) will be based on the income earned for that year. For example, for the tax year 2007 (Year of Assessment 2007 current year basis) you are required to declare your earnings for the year 2000.
The income of an employee from an employment includes wages, salary, remuneration, leave pay, fee, commission, bonus, gratuity, perquisite or allowance (whether such items are paid in money or otherwise) in respect of having or exercising the employment.
Personal relief is a deduction (against your taxable income) given in respect of yourself, wife/husband, children, medical expenses for parents, medical expenses of serious diseases, expenses on supporting equipment for disabled person, any life insurance premiums/contributions to approved provident or pension fund, premium for insurance on education or for medical benefit and annuity premium purchased through EPF annuity scheme.
Self Assessment is a method whereby a taxpayer is responsible for calculating his own tax and making payment within the specified period. Self Assessment is a total process change from the previous formal assessment system.
Under the formal assessment system, taxpayers are required to declare their incomes in the Return Form, submit the Return Form to the Inland Revenue Board (IRB) and the IRB will then raise the assessment. The Notice of Assessment is sent to the taxpayer and based on the tax raised in the Notice of Assessment, payment must be made accordingly.
Under the Self Assessment System, taxpayers are still required to complete and submit Return Form by the required dates. Taxpayers will have to calculate their own tax and make payment of the full amount. In the case of an employee, the Schedular Tax Deduction Scheme will continue to
apply i.e. tax will be deducted from the monthly salary and remitted to the IRB by the employer.
For more information, visit www.hasil.org.my
Income Tax is an amount of money which is taken from your earnings to help towards some of the cost of services we receive in this country. Everyone who earns or receives income exceeding a certain amount will be required to pay income tax. The tax payable for a tax year (a year of assessment) will be based on the income earned for that year. For example, for the tax year 2007 (Year of Assessment 2007 current year basis) you are required to declare your earnings for the year 2000.
The income of an employee from an employment includes wages, salary, remuneration, leave pay, fee, commission, bonus, gratuity, perquisite or allowance (whether such items are paid in money or otherwise) in respect of having or exercising the employment.
Personal relief is a deduction (against your taxable income) given in respect of yourself, wife/husband, children, medical expenses for parents, medical expenses of serious diseases, expenses on supporting equipment for disabled person, any life insurance premiums/contributions to approved provident or pension fund, premium for insurance on education or for medical benefit and annuity premium purchased through EPF annuity scheme.
Self Assessment is a method whereby a taxpayer is responsible for calculating his own tax and making payment within the specified period. Self Assessment is a total process change from the previous formal assessment system.
Under the formal assessment system, taxpayers are required to declare their incomes in the Return Form, submit the Return Form to the Inland Revenue Board (IRB) and the IRB will then raise the assessment. The Notice of Assessment is sent to the taxpayer and based on the tax raised in the Notice of Assessment, payment must be made accordingly.
Under the Self Assessment System, taxpayers are still required to complete and submit Return Form by the required dates. Taxpayers will have to calculate their own tax and make payment of the full amount. In the case of an employee, the Schedular Tax Deduction Scheme will continue to
apply i.e. tax will be deducted from the monthly salary and remitted to the IRB by the employer.
For more information, visit www.hasil.org.my
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