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Sunday, October 16, 2016

All about Tax

Do you know that: 

Income Tax
Income tax in Malaysia is collected by Inland Revenue Board, or better known as IRB or LHDN. Tax rate varies from 0% to 25%.

Goods and Services Tax 
Goods and Services Tax or GST is collected by Royal Customs and Excise Department.

Taxable Income
Only income derived and accrued in Malaysia is taxable under Section 4 of Income Tax Act. It means if you send funds obtained from your salary while working overseas, the fund does not attract income tax.

Withholding Tax
There was previously something called as withholding tax. A small portion of interest income received from your savings and fixed deposit in the bank is withheld by the bank to be paid to the government as tax. This tax has been discontinued in 2009.

Benjamin Franklin
Benjamin Franklin was once quoted saying that there's only 2 things certain in life; to pay tax and to die.

"In this world nothing can be said to be certain, except death and taxes."

Reduction of Tax Rate
Reduction in tax rate always benefit the rich more than the middle class and poor.

Writing for the sake of writing and to clear my head. A friend who is a COO of an IT company had asked me if she can evade tax if she brings back her income from investment in overseas.

Apparently, her accountant friend had given her the wrong advice and several others by saying that she would need to pay 25% of the amount to Income Tax. 

Come on la! This is Malaysia. Our income tax is written in the way that they tax income which is derived and accrued only in Malaysia. Don't believe, go read Section 4 of Income Tax Act.

1 comment:

  1. Also the Estate duty or death tax abolished 91 during Daim time. My mum used to worry that the roof my dad left us would be taxed and I would tease her that how I wished it to be as then she would have been a millionaire widow.