Question

MALAYSIAN TAX SUBJECT /

Mr. Raja i He works as a senior officer at National Audit Department, Putrajaya since year 1990. He received RM8,200 per month as salary and RM300 for the monthly entertainment allowance. He retired on 31 August 2018, when his age is 55 years old. ii. During his period of working with government, Mr. Raja has been provided with the following benefits: a. A fully- furnished house with monthly rental of RM2,100 of which RM480 is for furnishings. The furnished house was provided to Mr. Raja since year 2010 b. Medical cost of RM8,700 for her son's treatment in Hospital Serdang. iii. He has been paid a gratuity amounting to RM200,000 upon his retirement. iv. On September 2018, he was employed as senior manager by an audit firm, PriceWaterhouseCooper (PwC) in Kuala Lumpur. His gross salary is RM10,340 per month. He is also entitled to a travelling allowance of RM100 per month Additional information: i. Both Mrs. Kumari and Mr. Raja purchased books and magazines worth RM1,600 and RM790 respectively Type of policy Life Insurance for Mr Raja Premium paid per annum 3,800 ii. Mr. Raja donated cash of RM800 to the National Library, an approved institution Required: a) Compute the income tax payable for the year of assessment 2018 for (i) Mr. Raja

Answer 1

Computation of Total Income and Income Tax Payable of Mr. Raja For year 2018

			National Audit Report
Particulars	Per Month	Per Annum	Gross
Basic Salary	8200	98400	98400
Entertainment Allowance	300	3600
Leess: Exempt	300	3600
HRA (Note-1)	2100	25200
Less: Exempt (Note-1)		9600	15600
Gratuity Allowance		200000
Less: Exempt (Note-2)		200000	0
Medical Allowance	`	8700
Less: Exempt		8700	0
Gross Salary
Travelling Allowance
Less: Exempt
Gross Salary of PMC	10340	124080	124080
Travelling Allowance	100	1200
Less: Exepmt		0	1200
Gross Total Income			239280
Deduction
Child Care Allowance	Note 3	2400
Deposit SSPN		3900
Donation to national Library		800
Life Insurance		6000	13100
Net Income			226180

Computation of Total Income:

Net Income			226180
Income Tax
Upto RM 5000	0%	0
5000-20000	1%	150
20001-35000	5%	750
35001-50000	10%	1500
50001-70000	16%	3200
70001-100000	21%	6300
100001-226180	24%	6283.2	18183.2
Total Tax-Payable			18183.2

Note:

1. Calculation HRA   

Actual Received 19440

50% of Salary 49200

Rent Paid-10% of the Salary    9600

Lower of the above    9600

2. Gratuity should be fully exempt if retirement take place after 55 years.

3. Child care allowance in respect of children upto 12 years of age. RM2.400.

3. Tax Relief is given for life insurance premiums and contribution to approved retirement Fund (Such as the EPF) combined, upto RM6,000.