Monthly Tax Deduction as final tax

Assalammualaikum frens...

To those who are not yet aware. Starting this year, LHDN has introduced new tax return method which is using our monthly PCB or MTD as final tax....

Here is a brief on it based on FAQ compiled by IRB.

SECTION 1: INTRODUCTION

Q1: What is Monthly Tax Deduction (MTD) as Final Tax?

A1: Tax payers who fulfil the criteria of MTD as Final Tax may elect not to furnish a return (BNCP) to Inland Revenue Board of Malaysia (IRBM).

Q2: Who may elect not to furnish return?

A2: Tax payer may elect not to furnish return, if:
i. Has income only in respect of gains or profits from an employment other than gains or profits in respect of the use or enjoyment of benefits provided by his employer under paragraph 13(1)(b) or (1)(c);
ii. MTD have been made by his employer in respect of such gains or profits;
iii. Working for twelve months in the basis period with the same employer;
iv. Taxes are not borne by their employers; and
v. Not opted for joint/combined assessment with the spouse.

SECTION 2: RETURN

Q1: If tax payer do not fulfill with the criteria of MTD as final tax, do he needs to furnish return ?

A1: Yes. Tax payer needs to furnish return, if:
i. Works more than one employer or change employers during the year;
ii. Works less than twelve months during the year;
iii. Tax borne by employer;
iv. Opt for joint assessment;
v. Has non-employment income such as business income, rental income, etc during the year;
vi. Wish to claim refund or deduction/rebate and etc.

Q2: If tax payer works with two or more difference company within twelve
months in a year, do he needs to furnish return ?

A2: Yes. The tax payer has not complied with the criteria of working for twelve months in the basis period with the same employer.

Q3: If tax payer receive rental or dividen income, do he needs to furnish return ?

A3: Yes. Tax payer has income other than gains or profits from an employment, i.e. rental income, dividen income, commision without MTD deduction is not qualify elect not to furnish return. Therefore, he must submits the return before or at 30th April.

Q4: Tax payer fulfil the criteria of MTD as Final Tax, do he allows to furnish a
return ?

A4: Yes. He may submits the return before or at 30th April.

SECTION 3: CALCULATION FOR MTD AS FINAL TAX

Q1: How to verify the MTD as final tax calculation is accurate and correct? A1: (a) Employer’s who use the payroll system (Computerised Calculation Method) Tax payer may use the ‘Kalkulator PCB’ at IRBM website to verify the MTD calculation.
(b) Employer’s who use manual Table/Schedule of MTD (without payroll system) Tax payer may use table/schedule of MTD to verify the MTD calculation.

Q2: The MTD calculation using formula (computerised calculation method) is
difference from using table/schedule of MTD?

A2: Yes. There is a slightly difference of MTD calculation by using formula (computerised calculation method) compare to table/schedule of MTD. The formula (computerised calculation method) is more accurate and round up to cent value. But, MTD calculation for table/schedule of MTD is based on the range of RM5.00 within the two value by taking the highest of that particular range as MTD calculation (i.e. RM2,571 – RM 2,575, the MTD calculation is based on RM 2,575).

Q3: If the employer using the wrong method to determine to MTD calculation, is
there any compound issue to employer?

A3: Yes. Under the Income Tax (Deduction From Remuneration) (Amendment) Rules, the compound will be issued to the employer whose not comply with using the correct method to determine MTD and deduct less MTD. However, the employer has the right to appeal for that particular compound issued.

Q4: Tax payer received EA/EC form from employer and discovered the MTD as
Final Tax is not accurate/correct, What should tax payer do ?

A4: Tax payer may elect to submit return form to verify the accuracy of MTD deduction determined by employer.
If the taxable amount as per return form is different from the MTD deducted by the employer, tax payer may elect to furnish return form before or at 30 April.

SECTION 4: LATE SUBMISSION PENALTY/ FAIL TO FURNISH RETURN FORM

Q1: Tax payer fulfill the criteria MTD as Final Tax and submit the return form after 30 April to claim additional deduction or rebate, is there any late submission penalty?

A1: Yes. There is penalty under Section 112(3), Income Tax Act 1967. The total penalty amount should offset with the refund (if any).

GST : Frequently Asked Question (FAQ) - Part 1

Q1 What is GST?
GST is a consumption tax based on the value-added concept. GST is imposed on goods and services at every production and distribution stage in the supply chain including importation of goods and services.

Q2   Is GST a new consumption tax?
GST will replace the present consumption tax comprising the sales tax and the service tax (SST). The difference between GST and the present consumption tax is in terms of its scope of charge which is more comprehensive, inclusive of the manufacturing and distribution stages as well as providing a tax credit claim for GST paid on business inputs. When compared with the present consumption tax system, the sales tax is imposed only at the manufacturing stage that is at the time when the goods are manufactured or when the goods are imported. On the other hand, service tax is imposed on specific services at the time when the services are provided to the consumer.

Q3   Why the sales tax and service tax (SST) need to be replaced with GST?
GST is a more comprehensive, effective, transparent, and business friendly tax system. GST can overcome the various weaknesses inherent in the present consumption tax system. The inherent weaknesses under the present tax system are the cascading tax, double tax and pyramiding tax, tax erosion and leakages through transfer pricing and other means. Besides that, GST is expected to increase tax compliance and is easier to administer in view of its self policing method. Besides that, the businesses are required only to submit simplified tax returns based on prescribed formats. All records and documents relating to the relevant transaction are required to be kept in the business premises for audit by the GST auditor.

Q4   What is the rate of GST that will be imposed?
The Government has fixed the GST rate at 6%.

Q5  When will the government implement GST?
Goods and Services Tax (GST) will be implemented with effective from 1 April 2015 and GST rate is fixed at 6 (%) per cent.

Q6   How does GST work?
GST is charged and collected on all taxable goods and services produced in the country including imports. Only businesses registered under GST can charge and collect GST. GST collected on output must be remitted to the government. However, businesses are allowed to claim the input tax credit through the following mechanism and method:-

i. GST collected on output (output tax) is deducted against the GST paid on input (input tax).
ii. If there is excess, the amount shall be remitted to the government within the stipulated period.
iii. If there is deficit, businesses can claim for refund from the government.

Q7 Who will collect GST and remit to the government?
GST can only be collected by persons who are registered under GST and the tax shall be remitted to the government within the stipulated period.

Q8 How will the government ensure that the business will remit the right amount of tax collected to the government?
To ensure that businesses remit the right amount of tax, the government will conduct an early detection program through desk audit and transaction audit on the tax returns submitted by businesses for every taxable period. The GST audit team will conduct field audit on records and accounts of businesses to ensure there is no tax manipulation by businesses. Besides that, the GST risk assessment system, a computerized checking system, will trigger alerts relating to high risk cases.

Q9 Will the GST rate be increased in the near future like what has been done by the Singapore government?
The main objective of the government is to ensure the smooth and efficient implementation of the GST. The government has no plans to increase the GST rate like what has been done by the Singapore government. The government is concerned and always take into consideration the interest and welfare of the rakyat before making any policy changes. It is important to note that even though the sales tax was implemented since 1972, the rate has been increased only once in 1983, whilst the rate of service tax has never been increased since its introduction in 1975.

Q10 Are all goods and services subject to GST?
In principle, GST is imposed on all goods and services produced in the country including imports. However, certain basic foodstuff likes rice, sugar, flour, cooking oil, vegetable, fish and meat, eggs and essential services such as health and private education, public transportation, residential property and agricultural land are not subject to GST. Such exemption is to ensure that the lower income group is not burdened by GST.

Q11 Do I have to apply to Royal Malaysian Customs if I want to act as an agent for my overseas principal who is liable under the GST Act?
If an overseas principal is liable under the GST Act, he has to be registered through an agent appointed by him. Therefore, as a person appointed by the overseas principal, you must apply to RMC to be such agent. You need to submit supporting documents such as an authorized letter from the overseas principal. Upon such registration, you will be held accountable for GST liabilities and need to file returns on behalf of the overseas principal. You will also have to keep separate records for the non-resident. If you are a taxable person yourself, you must also register yourself separately.

Q12 How do I account for GST if my client has paid less than the amount of the progress claim?
If you issue a tax invoice equivalent to the value/ amount stated in the interim certificate, but is less than the amount stated in the progress claim, you may issue a debit note and account for GST.

Q13 What happens if a client does not pay after the tax invoice has been issued?
You can claim bad debts relief on the GST output tax paid in respect of taxable supplies. The GST portion of the bad deft can be recovered subject to certain conditions:

(a) The tax is already paid;
(b) You have not received any payment 6 months after the supply has been made, or the debtor has become insolvent; and
(c) Sufficient efforts have been made by you to recover the debt.

Q14 Do I have to make a formal claim to recover GST due to bad debt?
No, you only need to make an adjustment by increasing your input tax in your GST return after you have satisfied all the conditions for bad debt relief.

Q15 What types of export document to be kept?
All documents related to exportation must be kept for a period of seven years. Any failure to do so is an offence under GST Act 20XX. Documents that have to be kept are as follows:

(a)  Export declaration (K2)
(b)  Sales invoices
(c)   Bill of lading
(d)  Shipping note
(e)  Insurance note
(f)   Payment document, such as documentary credit, debit advice, bank statement, etc.
(g)  Debit and Credit note
(h)  Tally sheet from Port Authority (I)   Short ship/short landed certificate (j)   Other documents related to export.

Good Service Tax (GST)

Assalamualaikum...

we are now counting days to the implementation of GST, by now many should had have understand what is GST all about. Just in case you don't, i hope below sharing could assist you to have basic knowledge on this most talk about matters :)

WHAT IS GST ?

GST which is also known as Value Added Tax (VAT) in other countries is a tax on final consumption of goods and services in Malaysia.

GST is a broad based consumption tax and will be imposed on all goods and services made in Malaysia and import of goods and services into Malaysia [except goods and services categorized under zero rated supply and exempt supply orders as determined by the Minister of Finance (MoF) and published in the Gazette].

GST terminologies:

Input tax GST that a taxable person has incurred on the purchases of goods and services in the course or furtherance of his business

Output tax GST that a taxable person charges on his taxable supply of goods and services made by him in the course or furtherance of his business

Standard rated supplies Taxable supply of goods and services which are subject to GST at standard rate (i.e. 6%). The taxable person is eligible to claim input tax credit on his business inputs in making taxable supplies

Zero rated supplies Taxable supplies that are subject to zero rate. Although there is no GST to be imposed on these supplies, the taxable person is eligible to claim input tax credit on his business inputs in making taxable supplies

Exempt supplies Non-taxable supplies which are not subject to GST. Suppliers of exempt supplies are not eligible to claim the GST incurred on his business inputs

Scope of GST

•GST shall be charged on any taxable supply of goods and services made by a taxable person in the course or furtherance of business carried on by him in Malaysia.

•GST is charged on the importation of goods and services.

◦Goods imported will be charged GST at the time of importation.

◦Imported services will be taxed by adopting a “reverse charge mechanism” where a person who receive services from an overseas supplier is to account for GST as if such person had supplied the services to himself.

Example: Importation of services – reverse charge mechanism

•Importation of consultation services of USD10,000, @ RM3.4 = RM34,000, GST @ 6% = RM2,040

•When the recipient makes payment to the foreign supplier, the recipient has to account for output tax on the amount paid, i.e., output tax = RM 2,040. The amount shall be credited to the output GST account.

•In view that the recipient is in the business of providing taxable supply, the recipient can claim input tax credit on the GST paid of RM 2,040. The amount shall be debited to the Input GST account.

•At the end of the day, the entries of the output GST and input GST will cancel off each other. Nevertheless, the recipient MUST account for the transactions.

Unlike the present sales tax and service tax system which is a single stage tax, GST is a multi-stage consumption tax on goods and services. Payment of tax is made in stages by the intermediaries in the production and distribution process. Although the tax will be paid throughout the production and distribution chain, it is ultimately passed to the final consumer. Therefore, the tax itself is not a cost to the intermediaries and does not appear as an expense item in their financial statements.

A person is required to be registered for GST if he makes taxable supplies where the annual turnover exceeds RM 500,000.

A person who is registered under GST is required to charge GST on his output of taxable supply of goods and services made to his customers. He is allowed to claim as input tax credit any GST incurred on his purchases which are inputs to his business. His customer, if he is also in a business of making taxable supply of goods and services, in turn is allowed to claim input tax credit on GST paid on his output. Thus, double taxation will be avoided and only the value added at each stage is taxed.

Multi-stage collection and payment of GST

First layer Assuming a supplier making a taxable supply of goods sell the goods at the price of RM400 to the service provider. The GST charged by the supplier is 6% of RM400 = RM24. The amount that the service provider has to pay to the supplier is RM424. Assuming the supplier does not make any purchases in his business, i.e., no input tax incurred, the supplier will have to pay the output GST of RM24 to the Customs.

Second layer The service provider uses the goods purchased from the supplier to provide services to the local customer, and charge the customer a price of RM1,000 for the services rendered. The service provider will charge the customer a GST of 6% on the RM1,000, i.e., RM60. The total amount that the customer has to pay is RM1,060. The service provider’s output tax is RM60, i.e., what he charged to the customer. His input tax is RM24, i.e., what he paid to the supplier of the goods. The amount that he needs to pay to the Customs is the net, RM60 – RM24 = RM36. Note that GST is a form of value added tax, hence GST is imposed on the value add provided by the service provider, i.e. on the amount of RM600 [RM1,000 charged to the customer – RM400 paid to the supplier].

Third layer GST is borne by the individual end consumer.

Where output tax is more than the input tax, the GST registrant has to pay the net GST to the Customs.

Where output tax is less than input tax, a refund will be given by the Customs to the GST registrant.

There is no requirement to match input tax with output tax and the claim for input tax can be made when the expense is incurred and a GST tax invoice is issued by the vendor.

Ramli Awang Murshid (RAM)

Assalammualaikum....

Since primary school aku memang suka membaca. I am more into cerita2 penyiasatan but baca juga novel2 yg purely sastera for the sake of appreciating the authors. Yup ada juga baca novel2 simplistic yg glamor mcm Bukan Puteri Lindungan Bulan etc tu hahaha...

Masa kecik aku biasa dgn Enid Blyton yg dh diterjemahkan ke bahasa melayu...mana paham baca bahasa omputih. Best giler baca cerita 5 bersaudara tu sampai aku terbawa-bawa in my real life...aku tubuh pasukan penyiasatan sendiri dgn kawan2 sekolah hihi. Ntah apa2 la masatu.

Bila masuk U....my lecturer introduced me to Agatha Cristie...tried la baca a few of her mystery novel...menarik but just borrow from library je...not buying any of them. Agatha to me....macam tgk cerita kat channel Diva... dia slow....kita kena sabar tunggu plot berkembang.

Dalam masa yg sama i am also exposed to John Grisham....x kenal pun tapi selalu nampak novel dia atas rak library with such tipikal remarks like New York Best Seller! Which i noticed has been printed on almost all of english novel in book store...like seriously??

Okay back to the subject matter...RAM. aku 1st baca novel dia masa sek men...tajuk Pei Pan. Masa ni belum under alaf 21 and x borther pun siapa yg tulis but that novel won hadiah sastera sumthing...anugerah pak sako kalo tak silap. Sejak tu aku jatuh cinta dgn gaya penulisan dan olahan RAM.

Kebetulan makcik aku pun hantu novel. So bila aku pergi rumah dia time cuti...aku terjumpa novel ADAM. Sebuah naskah RAM juga....damn suspen gile cerita tu. Both Pei Pan and ADAM dah divisual kan dalam drama TV.

Eversince aku baca every single novel yg dihasilkan oleh RAM....tak beli but pinjam either dr acik or my good fren Azmir time di kampus. Bila dah kerja ni baru beli sendiri.

All and all RAM dh hasilkan 24 naskah kalau tak silap and aku dh baca semua kecuali sebuah je lagi....gigih nak cari ni.

Cakap pasal RAM ni...pd aku dia la novelis triller paling sukses di Malaysia. Bila masuk kedai buku, kalo tgk novelist lain org akan baca tajuk novel kan? But for him...org akan baca nama dia dulu...tajuk no 2 and almost tak penting. Sinopsis pun tak payah bother la sebab nama RAM on the cover page tu dah cukup gah.

Cara dia menulis cukup simple. Sekali sekala dia tunjuk skill guna bahasa bunga2 bila ada relevancy. Else he sticks to his usual way. Isi dia full of facts which i like....boleh learn so many new things by reading his novel. Siap bagi reference at the end of his novel so kita tahu dia tak fabricate the facts.

Idea dia original and walaupun agak science fiksyen tapi sentiasa diwajarkan dgn hujahan yg bersifat islamik. Ada nas dan dalil yg bertepatan utk sokong imaginasi2 luar tabii yg dia selitkan dalam plot cerita. Untuk yg dah biasa baca buku dia memang tak rasa janggal la.

Out of his many, aku paling suka series of Laksamana Sunan...boleh imagine cerita ni kalo di layar perak is better than Harry Potter and Lord Of The Ring tu sorry.... dia berjaya buat aku masuk into his own created fantasy dimension without sekelumit pun rasa merepek apa mamat ni.. ha macam tu la.

But yang paling aku tak suka is novel 9 nyawa....sorry to say la RAM. As follower aku rasa novel tu ditulis secara sambilan atau dgn malas....mcm left over food. Tak ada roh RAM yg kuat dalam tu....maybe sebab dia menyelit antara mega novel of sunan the series....dunno.

Wish dapat jumpa 1 hari nanti nak minta signature hehe....selalu pergi pesta buku hoping that dapat jumpa tp belum ada rezeki.

Ok...baru habes baca his latest actually...Raudhah...best. now nak sambung baca Mitch Albom's...the first call u receive from heaven.....dah lama beli tp tak habes2 baca...

Bai!

JPO, Hello Kitty World, Chupcai Cafe and Creator Hotel...

Assalamualaikum…


Last story kan was about my trip to Sibu Island in Mersing. Okay from Jetty Tg Leman to Johor Premium Outlet is only about 1 hour and half driving time. Hence kami decided to pay a short visit to JPO instead of going home! Hahaha

This is our 2nd visit to JPO (1st was about 2 years ago). We noticed the outlets are pretty much the same like before with addition of few new outlet namely Saccor, Oroton and few others which I can’t recall, probably because the brand is not familiar to me.

We spent about 6 hours there…simply walked in into each and every outlet that we feel we want to look in. Most outlet were having super-duper sales at that time, up to 80% for some stores.

Later at night we went for dinner at Cupchai Café & Bistro in Bandar Baru Uda…near by Plaza Angsana or close to Jakel. The place to me is quite cool to chill out…it has “kacang pool” a must have menu once you are in Jb! We tried as well its mee rebus, tasty but not the best. Pricing wise is reasonable.

After that we checked in at budget hotel named Creator Hotel in Kulai…yaya one must wonder why on earth I travel from JPO to Bandar Baru Uda then travel back to Kulai where tomorrow morning I m going to Puteri Harbour kan??? Well JB is close to my heart and to me all those area are not so far to each other since all of them are well linked with a toll highway. Jalan2 lah…

About the hotel. I am highly recommending this hotel to all who want cheap stay at reasonable comfort. Located near by main road, big and tall building….easy to spot. Nice deco, very arty and creative actually…better than higher rated hotel in Malaysia. The room is spacious, 32 sqft. Its clean and new, open in year 2014. Price only RM 99 and you also get breakfast voucher at Old Town White Coffer for 2 person. Heaven!

After check out, we went to our ultimate destination of the trip…..Hello Kitty Town in Puteri Harbour. About 40 minits drive from Kulai, using google maps the place is easily located. Our daughter got so excited the moment she saw Hello Kitty character on the building wall and she cries…cries…cries wanted to go into that building huhuhu….

We paid RM 85 each for an adult (3 yrs and above). Below 3 yrs is free so both of our kids are FOC. That amount grant us an access to all theme parks. You may also pay RM 55 to enter only 1 out of the 2 theme park which are Hello Kitty Town and Play park which I forgot the name.

Btw, price stated is for Malaysian ic holder only. In Hello Kitty park you basically will do visit and activities while in the other park it is for games and rides….because I was too eager to try almost everything so we decided to take the combo package of both.

Hello Kitty world (HKW) is a perfect place for your girl lah…..all pink in color! Sort of Kidzania’s set up but the area is smaller hence has lesser activities. It has Hello Kitty house, craft making, biscuits making , photo booth, maze and word search, playground, giant cup ride and of course Kitty’s show at the centre stage.

At level 2….it has ballerina class, pinggu island games centre, bob the builder massive playground and several food stores.

At level 3….it is like indoor theme park in Berjaya Megamall. Just that the rides are less xtreme and suitable for small kids. I tried all but the bump car because at the time I want to play it no one want to play with me and thus no car to bump to huhu. It’s actually pretty fun not only for kids but for us the parents too especially one like me who are not dare enough to ride on any extreme rides in another theme park.

We spent about 5 hours in there and had to rush back home since our journey heading back is about 5 hours. Before that we had our late lunch at The lat’s Place….awesome restaurant in terms of decoration. The whole concept is about Budak Kampung cartoon series.

So that’s about the end of our short and adhoc trip to JB…..

Sibu Island Resort

Assalammualaikum

Disclaimer: i am an indoor type of person.

Cuti sekolah datang lagi! This time kami sekeluarga berjalan ke Sibu Island Resort, Mersing Johor.

Journey from Kerteh is about 4 jam 30 minit drive. Ferry to Sibu Island stationed at Jetty Tg Leman Mersing but please don't get confuse with another Jetty to island located at the Mersing town. Tg Leman is farther than town...about 1 hour drive. Set your gps to kfc Tg Leman or Felda resort.

The ferry only depart twice perday from mainland to resort. 1130 am and 4 pm. Similarly going back to mainland at 10 am and 2 pm.

Apparently this island has only one resort which is SIR which i suspect the nearby islands have other resorts. Practically u had no choice to stay but here in SIR.

The ferry was quite large and able to accomodate 50 passengers at time. It tooks us 30 minits riding on the ferry before reaching our destination. U cant see the panaroma of the sea from inside ferry....pitty.

Once arrived....i really hope to be amazed. But tht wasn't the case. I think it is because i've been to Redang..my mind have some sort of expectation. Comparing both is not an apple to apple but ya....i prefer Redang or even Perhentian.

Compare with Kapas....i guess it about the same in the context of its sand and water quality. Still i like Kapas more because in Kapas you can feel the island mood. Here just too big and to hilly...resort far from sandy beach...i can't really sea the white beach and turqoise sea water.

Went for snorkeling at the beach. Not going to sea park. Got jelly fish but not so many. On second day they prohibited us from snorkeling as they said jelly fish getting more....

There are several xtvt provided by SIR like moonlight walk...we went to see blue sand. Ok it is not a sand in blue color but it is a sea species kind of plankton live in a deep sea...to me it looks like firefly but in blue and green light which actually its blood.

Other than that....it has junggle trekking which i don't try but i believe its fun because the track end up at the hill top. The have archery and flying fox facilities and typical beach xtvt such as banana boat etc.

Food wise...i have no complaint. Decent selection of menu...good taste and fresh materials.

The staff are mostly friendly...helpful and polite. The resort itself quite ok tho a little bit rundown but i am not really fussy about it because i know this is an island. Better than Kapas at least u have electricity and water supply all day and night.

Plus point about SIR is its open zoo concept. Tho not so many but ada peacock, deer, birds, goat....they live freely within the island vancinity and you can simply feed or touch them if u dare haha.

Thts all for now....babai