TAX - More Ways to SAVE

1. The higher-income spouse should claim child relief.


2. File separate assessments for husband and wife and claim tax reliefs individually. Generally, when one spouse does not work (and has no other source of Malaysian income), or has total income not exceeding RM3,000, it is beneficial for the income-earning spouse to elect for a combined assessment which entitles him/her to the RM3,000 spousal relief.

3. Claim direct expenses against rental income. Examples of direct expenses include interest incurred to finance the acquisition of the property, repairs and maintenance and so forth. Note that direct expenses in¬¬curred prior to letting of the property is not claimable.

4. Claim the medical expenses (limited to RM5,000) incurred for parents. Should the parents’ medical bills be shared among siblings, the amount expended by each sibling (up to RM5,000 each) would be their respective relieveable entitlement and sufficient evidence of payment must be maintained by each sibling.

For example, in a case when the receipt is in the name of the patient, the individual making the claim must obtain an endorsement on the receipt by the doctor to certify that medical charges were paid by him.

5. Claim medical expenses for the taxpayer, spouse and children on serious diseases up to RM5,000. This includes complete medical examination expenses of up to RM500.

6. If your job function requires you to travel extensively and your yearly travel allowance/toll is more than the standard tax exempt amount of RM6,000, you can review your travels to claim further deduction. Further de¬¬duction can only be claimed if you can provide records for your total claim.

7. If you are entitled to yearly leave passage as an employee, claim the following against your leave passage benefit:

> Travel (includes fares, meals or accommodation) within Malaysia for your family up to three trips.

> One overseas travel (fares only) for your family.

8. Foreign-sourced income is not taxable even if it is remitted into Malaysia. So you are not required to report such income in the tax returns. Examples of such income is rental income from properties located outside Malaysia and employment income arising from an employment exercised outside Malaysia and not incidental to the Malay¬sian employment.

9. In case either you or your spouse has tax overpayments, you can request the Inland Revenue Board (IRB) to transfer the credit to offset the balance of tax either one of you is required to pay. This will improve the cash outflow of your family.

10. Effective from 2009, you can claim interest up to RM10,000 a year which is paid on housing loans for three consecutive years from the first year the housing loan interest is paid. The claim is subject to the following conditions:

a. You are a Malaysian citizen and a tax resident.

b. Limited to one residential house including flat, apartment or condominium.

c. The sale and purchase agreement is executed between March 10, 2009 and Dec 31, 2010.

d. You have not derived any income in respect of that residential property.