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> Rental income, interest and tax deduction question, How they are all related?

chunho01
post Dec 8 2010, 08:57 PM


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I read before that if the property is used to generate rental income, the interest portion of the mortgage repayment can be claimed as tax deduction. I am a bit confused by the statement above.

My current interpretation of the statement is:
Let's say my monthly mortgage repayment is RM1000, and out of the RM1000, RM700 is interest.
I can deduct RM700 from my rental income as it is to pay the mortgage interest without paying tax for the RM700.
However, I will need to pay tax for the remaining rental income, the amount after deducted the RM700.

I appreciate further clarification on this matter. Thank you for all your advices smile.gif
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kok_pun
post Dec 9 2010, 12:50 AM


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put it in an easy way: your nett gain is taxable, the rest are non taxable

the expenses like sinking fund, management fee and etc can be deducted as well.

so total gain 1000 - interest 700 - bills (maybe 150) = 150

taxable income rm150 only


Added on December 9, 2010, 12:51 amplease note that assessment and quit rent cannot be deducted...afaik

This post has been edited by kok_pun: Dec 9 2010, 12:51 AM
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awiekupo
post Dec 9 2010, 08:37 AM


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Is there any such thong as tax deduction if we buy a new house? (eg; for paying deposit of non-completed unit)
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property101
post Dec 9 2010, 09:11 AM


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QUOTE(kok_pun @ Dec 9 2010, 12:50 AM)
put it in an easy way: your nett gain is taxable, the rest are non taxable

the expenses like sinking fund, management fee and etc can be deducted as well.

so total gain 1000 - interest 700 - bills (maybe 150)  = 150

taxable income rm150 only
does this apply to individual investor or property management company? or both?
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rakyat
post Dec 9 2010, 09:20 AM


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QUOTE(kok_pun @ Dec 9 2010, 12:50 AM)
put it in an easy way: your nett gain is taxable, the rest are non taxable

the expenses like sinking fund, management fee and etc can be deducted as well.

so total gain 1000 - interest 700 - bills (maybe 150)  = 150

taxable income rm150 only


Added on December 9, 2010, 12:51 amplease note that assessment and quit rent cannot be deducted...afaik
*
kok_pun - r u sure of the calculation? As a 'mortgage advisor', u should check ur facts. You CANNOT* interest as cost.

You can only deduct 'cost of making the property rentable' i.e. minor renovation, fittings, repairs, stamping cost, agency fees & maintainence cost. Hence the calculation should be gain 1000 - bills 150 = RM850.00 taxable income


* except for 'own stay' property bought from 2009 onward but this is only for a 3 year period (2009 to 2011)
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yeowa
post Dec 9 2010, 09:21 AM


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QUOTE(awiekupo @ Dec 9 2010, 08:37 AM)
Is there any such thong as tax deduction if we buy a new house? (eg; for paying deposit of non-completed unit)
*
Deposit cannot be deducted as it is part of the capital expenses (i.e. house).

QUOTE(property101 @ Dec 9 2010, 09:11 AM)
does this apply to individual investor or property management company? or both?
*
Apply for both. You can claim your interest, utility bills incurred and maintenance fees.
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rakyat
post Dec 9 2010, 09:22 AM


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QUOTE(property101 @ Dec 9 2010, 09:11 AM)
does this apply to individual investor or property management company? or both?
*
Both uses the same calculation except for companies can deduct 'cost of maintaining the company' - audit, accounts, salary & depreciation
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property101
post Dec 9 2010, 09:38 AM


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QUOTE(rakyat @ Dec 9 2010, 09:20 AM)
kok_pun - r u sure of the calculation? As a 'mortgage advisor', u should check ur facts. You CANNOT* interest as cost.

You can only deduct 'cost of making the property rentable' i.e. minor renovation, fittings, repairs, stamping cost, agency fees & maintainence cost. Hence the calculation should be gain 1000 - bills 150 = RM850.00 taxable income
* except for 'own stay' property bought from 2009 onward but this is only for a 3 year period (2009 to 2011)
*
care to explain more on 3 years period?

for example i bought a property in year 2009, i rented it out. while filing income tax, my taxable is only rm150? and i can do this until year 2011. from 2012 onwards i will not be able to deduct the interest portion from being taxed?

or

as long as the property is bought in between 2009 to 2011, i will be able to deduct the interest portion from tax? even in year (lets say) 2015, i still can deduct the interest portion?

This post has been edited by property101: Dec 9 2010, 09:39 AM
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yeowa
post Dec 9 2010, 09:44 AM


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QUOTE(rakyat @ Dec 9 2010, 09:20 AM)
kok_pun - r u sure of the calculation? As a 'mortgage advisor', u should check ur facts. You CANNOT* interest as cost.

You can only deduct 'cost of making the property rentable' i.e. minor renovation, fittings, repairs, stamping cost, agency fees & maintainence cost. Hence the calculation should be gain 1000 - bills 150 = RM850.00 taxable income
* except for 'own stay' property bought from 2009 onward but this is only for a 3 year period (2009 to 2011)
*
hi. Interest is deductible if your property are generating income.

Source: Malaysian Taxation - Rental Income
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kok_pun
post Dec 9 2010, 10:40 AM


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QUOTE(property101 @ Dec 9 2010, 09:11 AM)
does this apply to individual investor or property management company? or both?
*
i did for myself individual, no idea on company 1...


Added on December 9, 2010, 10:51 am
QUOTE(rakyat @ Dec 9 2010, 09:20 AM)
kok_pun - r u sure of the calculation? As a 'mortgage advisor', u should check ur facts. You CANNOT* interest as cost.

You can only deduct 'cost of making the property rentable' i.e. minor renovation, fittings, repairs, stamping cost, agency fees & maintainence cost. Hence the calculation should be gain 1000 - bills 150 = RM850.00 taxable income
* except for 'own stay' property bought from 2009 onward but this is only for a 3 year period (2009 to 2011)
*
mortgage consultant is my job, a sales job mar.... this is tax planning mar, not in my job scope also... i am sharing my personal experience, it is just what i know....
and thanks for pointing out biggrin.gif

then i have to redo my tax for last year. Are you pretty sure interest is taxable? any source? Please provide... i am getting worried.


Added on December 9, 2010, 10:53 am
QUOTE(yeowa @ Dec 9 2010, 09:44 AM)
hi. Interest is deductible if your property are generating income.

Source: Malaysian Taxation - Rental Income
*
then rakyat is wrong and i am right.... guess i need not to redo my tax lar.....

friend, dont scare me okay?


Quote:
"
# mortgage interest ( Please take note that mortgage interest is not equaled to the mortgage payment. Monthly mortgage payment consist of mortgage interest and capital repayment. Mortgage interest is deductible expense but capital repayment is not deductible expense)
"

This post has been edited by kok_pun: Dec 9 2010, 10:53 AM
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yeowa
post Dec 9 2010, 10:55 AM


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QUOTE(kok_pun @ Dec 9 2010, 10:40 AM)
i did for myself individual, no idea on company 1...


Added on December 9, 2010, 10:51 am

mortgage consultant is my job, a sales job mar.... this is tax planning mar, not in my job scope also... i am sharing my personal experience, it is just what i know....
and thanks for pointing out biggrin.gif

then i have to redo my tax for last year. Are you pretty sure interest is taxable? any source? Please provide... i am getting worried.


Added on December 9, 2010, 10:53 am
then rakyat is wrong and i am right.... guess i need not to redo my tax lar.....

friend, dont scare me okay?
Quote:
"
# mortgage interest ( Please take note that mortgage interest is not equaled to the mortgage payment. Monthly mortgage payment consist of mortgage interest and capital repayment. Mortgage interest is deductible expense but capital repayment is not deductible expense)
"
*
You can claim interest if your property you rent out is on loan.

This post has been edited by yeowa: Dec 9 2010, 10:55 AM
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kok_pun
post Dec 9 2010, 11:01 AM


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thanks yeowa, the picture is clear and bright now
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yeowa
post Dec 9 2010, 11:16 AM


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QUOTE(kok_pun @ Dec 9 2010, 11:01 AM)
thanks yeowa, the picture is clear and bright now
*
you are most welcome. Got scared by rakyat eh... hahaha...
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rakyat
post Dec 9 2010, 01:00 PM


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QUOTE(yeowa @ Dec 9 2010, 11:16 AM)
you are most welcome. Got scared by rakyat eh... hahaha...
*
Ai-yer then all this while I have been doing the wrong approach mad.gif Should not pay down the loan!

Well we learn something new everyday. Sori for wrong info.
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property101
post Dec 9 2010, 01:34 PM


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no wonder property guru ask people to borrow as much as possible...

can anyone enlighten me on the following?

QUOTE(property101 @ Dec 9 2010, 09:38 AM)
care to explain more on 3 years period about 2009-2011?

for example i bought a property in year 2009, i rented it out. while filing income tax, my taxable is only rm150? and i can do this until year 2011. from 2012 onwards i will not be able to deduct the interest portion from being taxed?

or

as long as the property is bought in between 2009 to 2011, i will be able to deduct the interest portion from tax? even in year (lets say) 2015, i still can deduct the interest portion?
*
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Iceman74
post Dec 9 2010, 01:56 PM


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QUOTE(property101 @ Dec 9 2010, 01:34 PM)
no wonder property guru ask people to borrow as much as possible...

can anyone enlighten me on the following?
*
The up to RM10k relief is for those signed S&P from 10.03.2009 to 31.12.2010. - you still have 20 more days smile.gif
The condition is
1. Malaysian citizen & resident
2. limited to 1 residential
3. cannot be rent out or cannot have any rental income

there are fomula to calculate it. look it up in IRB website

This post has been edited by Iceman74: Dec 9 2010, 01:58 PM
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chunho01
post Dec 9 2010, 08:31 PM


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Thank you everyone for your replies biggrin.gif I am now clear on the deductable expenses of taxable rental income


Added on December 9, 2010, 8:37 pm
QUOTE(kok_pun @ Dec 9 2010, 12:50 AM)

Added on December 9, 2010, 12:51 amplease note that assessment and quit rent cannot be deducted...afaik
*
Wait! From the link provided, assessment and quit rent are also included under deductable expenses. Can someone clarify this?

Note*: I have yet to buy my first property, still in learning stage. So may I ask, what is assessment and quit rent?

Malaysia Taxation on Rental Income

This post has been edited by chunho01: Dec 9 2010, 08:37 PM
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yeowa
post Dec 9 2010, 08:55 PM


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QUOTE(chunho01 @ Dec 9 2010, 08:31 PM)
Thank you everyone for your replies biggrin.gif I am now clear on the deductable expenses of taxable rental income


Added on December 9, 2010, 8:37 pm

Wait! From the link provided, assessment and quit rent are also included under deductable expenses. Can someone clarify this?

Note*: I have yet to buy my first property, still in learning stage. So may I ask, what is assessment and quit rent?

Malaysia Taxation on Rental Income
*
assessment n quit rent is payable annually depending on the size of your property to majlis pembandaran. as i know, it is deductible.
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lhkmmyy
post Dec 9 2010, 11:52 PM


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QUOTE(Iceman74 @ Dec 9 2010, 01:56 PM)
The up to RM10k relief is for those signed S&P from 10.03.2009 to 31.12.2010. - you still have 20 more days smile.gif
The condition is
1. Malaysian citizen & resident
2. limited to 1 residential
3. cannot be rent out or cannot have any rental income

there are fomula to calculate it. look it up in IRB website
*
Yea, this is the same as what i know. The property cannot be rented!! Else any individual is not entitled for the tax deduction.
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jasonhanjk
post Dec 10 2010, 11:06 AM


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The age old strategy is this:

You do not want to own your property, you let the bank own the property. You merely want to control it.
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yeowa
post Dec 10 2010, 11:53 AM


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QUOTE(rakyat @ Dec 9 2010, 01:00 PM)
Ai-yer then all this while I have been doing the wrong approach  mad.gif Should not pay down the loan!

Well we learn something new everyday. Sori for wrong info.
*
I think you can redo and submit a reduced assessment. Claim back all your taxes paid. smile.gif
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rakyat
post Dec 10 2010, 02:24 PM


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QUOTE(yeowa @ Dec 10 2010, 11:53 AM)
I think you can redo and submit a reduced assessment. Claim back all your taxes paid. smile.gif
*
No-la, my tax consultant did deduct the interest but I thot it was due to the 2009 to 2011 taxbreak thingy & borang B instead of BE.

Anyway I'm an oldtime cinaman not Mr. Donald Trump, I wanna pay off my liabilities and not over extend my leverage especially now that many ppl predicting that the property bubble gonna burst + US double dip + recession.
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yeowa
post Dec 10 2010, 02:43 PM


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QUOTE(rakyat @ Dec 10 2010, 02:24 PM)
No-la, my tax consultant did deduct the interest but I thot it was due to the 2009 to 2011 taxbreak thingy & borang B instead of BE.

Anyway I'm an oldtime cinaman not Mr. Donald Trump, I wanna pay off my liabilities and not over extend my leverage especially now that many ppl predicting that the property bubble gonna burst + US double dip + recession.
*
hahaha.... you call yourself cinaman? aiyo... cinaman rich is ok ma... smile.gif
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cutealex
post Dec 10 2010, 05:23 PM


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QUOTE(rakyat @ Dec 9 2010, 09:20 AM)
kok_pun - r u sure of the calculation? As a 'mortgage advisor', u should check ur facts. You CANNOT* interest as cost.

You can only deduct 'cost of making the property rentable' i.e. minor renovation, fittings, repairs, stamping cost, agency fees & maintainence cost. Hence the calculation should be gain 1000 - bills 150 = RM850.00 taxable income
* except for 'own stay' property bought from 2009 onward but this is only for a 3 year period (2009 to 2011)
*
this only implement for 3 years ? 2009 - 2011? for eg, i have rent my house at Jan 2010 - Dec 2010, but S&P was signed on Jan 2008. can it be claim?

now i received LDHN, 1 week ago and ask me to declare, i) Pemastautin warganegara Malaysia (mean malaysian right?) ii) Terhad satu unit sahaja/ iii) perjanji jual beli ditandatangi dalam tempoh 10 MAc- 31 2010, iv) rumah tersebut tidak boleh disewakan.

how? if i got sign other property S&P at Jan 2010...but interest a little bit.. what else can be claim ? thanks

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rakyat
post Dec 13 2010, 02:22 PM


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QUOTE(cutealex @ Dec 10 2010, 05:23 PM)
this only implement for 3 years ? 2009 - 2011? for eg, i have rent my house at Jan  2010 - Dec 2010, but S&P was signed on Jan 2008. can it be claim?

now i received LDHN, 1 week ago and ask me to declare, i) Pemastautin warganegara Malaysia (mean malaysian right?) ii) Terhad satu unit sahaja/ iii) perjanji jual beli ditandatangi dalam tempoh 10 MAc- 31 2010, iv) rumah tersebut tidak boleh disewakan.

how? if i got sign other property S&P at Jan 2010...but interest a little bit.. what else can be claim ? thanks
*
Ai-ya u never read that I got it wrong-meh?

For rental property, u can claim back the interest portion of your loan instalment no matter when you bought the property and for as long as you service your bank loan.

So in your case, you can deduct the loan interest from your rental income.

If for 'own stay' then property bought from Jan 2009 to Dec 2011 eligable to tax rebate on the interest paid for the 3 yrs
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property101
post Dec 14 2010, 12:06 AM


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QUOTE(rakyat @ Dec 13 2010, 02:22 PM)
Ai-ya u never read that I got it wrong-meh?

For rental property, u can claim back the interest portion of your loan instalment no matter when you bought the property and for as long as you service your bank loan.

So in your case, you can deduct the loan interest from your rental income.

If for 'own stay' then property bought from Jan 2009 to Dec 2011 eligable to tax rebate on the interest paid for the 3 yrs
*
haha...what if my condo has 4 rooms, i own stay one room and rent out the other 3 whistling.gif
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cutealex
post Dec 14 2010, 02:43 AM


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QUOTE(rakyat @ Dec 13 2010, 02:22 PM)
Ai-ya u never read that I got it wrong-meh?

For rental property, u can claim back the interest portion of your loan instalment no matter when you bought the property and for as long as you service your bank loan.

So in your case, you can deduct the loan interest from your rental income.

If for 'own stay' then property bought from Jan 2009 to Dec 2011 eligable to tax rebate on the interest paid for the 3 yrs
*
sorry...where and which part of LDHN to claim for "rental property" ??? thanks
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Iceman74
post Dec 14 2010, 08:45 AM


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QUOTE(property101 @ Dec 14 2010, 12:06 AM)
haha...what if my condo has 4 rooms,  i own stay one room and rent out the other 3  whistling.gif
*
if you really wanted to report yr extra income, you are welcome to do so tongue.gif
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yeowa
post Dec 14 2010, 09:01 AM


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QUOTE(property101 @ Dec 14 2010, 12:06 AM)
haha...what if my condo has 4 rooms,  i own stay one room and rent out the other 3  whistling.gif
*
As long as your tenant does not claim as expenses in their business income, you are safe not to declare your income. Your tenants are just working adults right?

Unless if you want to buy more properties in the future, there is always need for you to declare all your rental income. No tax paid with many properties will lead to IRB investigation. smile.gif



This post has been edited by yeowa: Dec 14 2010, 09:05 AM
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novabankinghall
post Dec 15 2010, 08:33 AM


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i always thought rental income can only be "recognize" in your income tax if its consider as rental business income

rental business income means:-

1) you are individual but have 5 or more residential property which generates rental income

or

2) you have a registered property holding company
for these properties however this also means the rental business is recognized for the business not the individual

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rakyat
post Dec 15 2010, 08:54 AM


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QUOTE(novabankinghall @ Dec 15 2010, 08:33 AM)
i always thought rental income can only be "recognize" in your income tax if its consider as rental business income

rental business income means:-

1) you are individual but have 5 or more residential property which generates rental income

or

2) you have a registered property holding company
for these properties however this also means the rental business is recognized for the business not the individual
*
I think the above qualify you to file your claim as a business entity borang B instead of BE. But even for individual with 1 rental property you need to declare your rental income, this is filed under the same section as the annual salary/ bonus. There is a sub-section for other income source.

Most of the time if you stamped your tenancy agreement you will need to declare as it is quite easy for IRB to connect the dots. If no legal/ stamped agreement then you might try to fool IRB by declaring the property vacant.

For renting out rooms, IMO you do not need a stamped tenancy agreement since u r in contact with the tenant everyday. Chances of absconding or non-payment or damaging ur property is kept in check by u daily. Hence if not stamped, you can 'forget' to declare and the case is not as obvious as a property left 'vacant'

This post has been edited by rakyat: Dec 15 2010, 08:57 AM
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yeowa
post Dec 15 2010, 09:05 AM


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QUOTE(rakyat @ Dec 15 2010, 08:54 AM)
I think the above qualify you to file your claim as a business entity borang B instead of BE.  But even for individual with 1 rental property you need to declare your rental income, this is filed under the same section as the annual salary/ bonus. There is a sub-section for other income source.

Most of the time if you stamped your tenancy agreement you will need to declare as it is quite easy for IRB to connect the dots. If no legal/ stamped agreement then you might try to fool IRB by declaring the property vacant.

For renting out rooms, IMO you do not need a stamped tenancy agreement since u r in contact with the tenant everyday. Chances of absconding or non-payment or damaging ur property is kept in check by u daily. Hence if not stamped, you can 'forget' to declare and the case is not as obvious as a property left 'vacant'
*
Thanks for the clearer explanation. smile.gif My explanation was more to a lazy bummer type. smile.gif
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novabankinghall
post Dec 15 2010, 11:46 PM


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ok then.... my next question... is

As an individual (say only 1 property with rental income). If i declare my rental income, will it improve my financial credit? Say in future wish to apply for more property loans, will they take in consideration of my rental income to approve my loan?

Perhaps this might be case to case basis, but if any credit officer out there pls comment. Or anyone with this experience welcome to comment too.
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yeowa
post Dec 16 2010, 12:19 AM


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QUOTE(novabankinghall @ Dec 15 2010, 11:46 PM)
ok then.... my next question... is

As an individual (say only 1 property with rental income). If i declare my rental income, will it improve my financial credit? Say in future wish to apply for more property loans, will they take in consideration of my rental income to approve my loan?

Perhaps this might be case to case basis, but if any credit officer out there pls comment. Or anyone with this experience welcome to comment too.
*
Yes, this will. But you need a tenancy agreement to prove it.
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novabankinghall
post Dec 16 2010, 12:23 AM


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QUOTE(yeowa @ Dec 16 2010, 12:19 AM)
Yes, this will. But you need a tenancy agreement to prove it.
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is the tenancy agreement good without stamping? smile.gif
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yeowa
post Dec 16 2010, 10:38 AM


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QUOTE(novabankinghall @ Dec 16 2010, 12:23 AM)
is the tenancy agreement good without stamping? smile.gif
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Not really sure about this. But you can call loan officer to find out. Sure they are more than happy to assist. smile.gif
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yeapsc73
post May 25 2012, 12:38 PM


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the deduction for loan interest is applicable if we refinance the house?

say, initially rental = 1700, loan interest 700, net rental taxable montly = 1000

if i refinance the house, now with loan interest 1300, so now rental taxable = 300?

sifus please advise
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michaellee
post May 25 2012, 06:34 PM


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QUOTE(yeapsc73 @ May 25 2012, 12:38 PM)
the deduction for loan interest is applicable if we refinance the house?

say, initially rental = 1700, loan interest 700, net rental taxable montly = 1000

if i refinance the house, now with loan interest 1300, so now rental taxable = 300?

sifus please advise
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once you refinance your house, you lose all your interest deductibility benefits.


Added on May 25, 2012, 6:36 pm
QUOTE(rakyat @ Dec 15 2010, 08:54 AM)
I think the above qualify you to file your claim as a business entity borang B instead of BE.  But even for individual with 1 rental property you need to declare your rental income, this is filed under the same section as the annual salary/ bonus. There is a sub-section for other income source.

Most of the time if you stamped your tenancy agreement you will need to declare as it is quite easy for IRB to connect the dots. If no legal/ stamped agreement then you might try to fool IRB by declaring the property vacant.

For renting out rooms, IMO you do not need a stamped tenancy agreement since u r in contact with the tenant everyday. Chances of absconding or non-payment or damaging ur property is kept in check by u daily. Hence if not stamped, you can 'forget' to declare and the case is not as obvious as a property left 'vacant'
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I am not certain if income tax has actually pursue such scenarios but if you have more than 1 property and the other properties are being occupied by relatives who doesn't pay you rental, you are still obliged under the law to pay not less than 70% of the market rental rate, ie a RM1,000 you should declare RM700 as rental income even though you are not receiving anything. This was done to prevent the cash economy of accepting rental and not declaring it. I know Australia is extremely strict on the second property rule.

This post has been edited by michaellee: May 25 2012, 06:36 PM
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yeapsc73
post May 25 2012, 08:58 PM


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thanks michael.

what if i top up loan for my first house and use the money to pay downpayment for second house, is the interest for the top up loan deductible from rental for second home?

say rental for second house is 1700, loan interest 700, top up loan interest 500, so net rental permonth is?

first house is for own stay
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michaellee
post May 26 2012, 12:23 AM


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QUOTE(yeapsc73 @ May 25 2012, 08:58 PM)
thanks michael.

what if i top up loan for my first house and use the money to pay downpayment for second house, is the interest for the top up loan deductible from rental for second home?

say rental for second house is 1700, loan interest 700, top up loan interest 500, so net rental permonth is?

first house is for own stay
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This is way too technical and should be address to a tax consultant. But my believe is such, once I take a loan out for a property, I will leave it there until the tenure is up especially if it is for investment. The only thing I am happy to do is to hope that the bank can readjust my interest every now and then downward.

It is very hard to separate the original interest and the top up portion as the bank would not separate it for you and instead lump it into one loan.
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ruben7389
post May 26 2012, 09:09 AM


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QUOTE(michaellee @ May 26 2012, 12:23 AM)
This is way too technical and should be address to a tax consultant. But my believe is such, once I take a loan out for a property, I will leave it there until the tenure is up especially if it is for investment. The only thing I am happy to do is to hope that the bank can readjust my interest every now and then downward.

It is very hard to separate the original interest and the top up portion as the bank would not separate it for you and instead lump it into one loan.
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I asked my banker they said it will not be lumped under one loan and rather another loan given out for it.

My tax consultant says that Interest due to the loan taken to acquire the property to generate rental is tax deductible. Hence, my understanding is that the top up portion is not tax deductible

If the top up loan is to acquire another property and you want to use interest on top up loan for prop 1 to offset against rental of prop 2, I think this then becomes very complicated and open to scrutiny if called up, even if that's doable which Im not sure
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SmallPotato2011
post May 26 2012, 11:14 AM


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QUOTE(chunho01 @ Dec 9 2010, 08:31 PM)
Thank you everyone for your replies biggrin.gif I am now clear on the deductable expenses of taxable rental income


Added on December 9, 2010, 8:37 pm

Wait! From the link provided, assessment and quit rent are also included under deductable expenses. Can someone clarify this?

Note*: I have yet to buy my first property, still in learning stage. So may I ask, what is assessment and quit rent?

Malaysia Taxation on Rental Income
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This information is very useful for passive income investor....
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michaellee
post May 26 2012, 12:07 PM


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QUOTE(ruben7389 @ May 26 2012, 09:09 AM)
I asked my banker they said it will not be lumped under one loan and rather another loan given out for it.

My tax consultant says that Interest due to the loan taken to acquire the property to generate rental is tax deductible.  Hence, my understanding is that the top up portion is not tax deductible

If the top up loan is to acquire another property and you want to use interest on top up loan for prop 1 to offset against rental of prop 2, I think this then becomes very complicated and open to scrutiny if called up, even if that's doable which Im not sure
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Hi, exactly what I meant with the difficulty of separating the loan amount. If you can separate the loan amount from the top up, then the original amount is tax deductible but not the top up portion. But because you have actually topped up the amount, and since we cannot separate which interest belongs to which, you might end up losing your tax deductibility advantage for your initial/original interest portion of the loan. Cheers!
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ruben7389
post May 26 2012, 04:10 PM


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cool... at least then my banker and tax guys seem to know what they are doing. thanks boss for your input
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kiddo
post Mar 13 2013, 10:20 PM


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hi all,
how do we know the total RM of mortgage interest paid for the particular year?
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tiramisu83
post Apr 16 2013, 04:12 PM


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QUOTE(kiddo @ Mar 13 2013, 10:20 PM)
hi all,
how do we know the total RM of mortgage interest paid for the particular year?
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u didn't get any bank statement? It stated clearly there, or you need to go bank and check, some fees may charged
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tiramisu83
post Apr 16 2013, 04:14 PM


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QUOTE(kok_pun @ Dec 9 2010, 12:50 AM)
put it in an easy way: your nett gain is taxable, the rest are non taxable

the expenses like sinking fund, management fee and etc can be deducted as well.

so total gain 1000 - interest 700 - bills (maybe 150)  = 150

taxable income rm150 only


Added on December 9, 2010, 12:51 amplease note that assessment and quit rent cannot be deducted...afaik
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Assessment and quit rent confirmed cannot be deducted?
I saw this 2 can be deducted in www.start-investing.com/Malaysia-Investment/Property-Investment/Malaysia-Taxation-on-Rental-Income.html
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This post has been edited by tiramisu83: Apr 16 2013, 04:15 PM
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1282009
post Apr 16 2013, 07:00 PM


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QUOTE(tiramisu83 @ Apr 16 2013, 04:14 PM)
Assessment and quit rent confirmed cannot be deducted?
I saw this 2 can be deducted in www.start-investing.com/Malaysia-Investment/Property-Investment/Malaysia-Taxation-on-Rental-Income.html
blink.gif
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Interested to know as well..


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EddyLB
post Apr 16 2013, 07:23 PM


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QUOTE(1282009 @ Apr 16 2013, 07:00 PM)
Interested to know as well..
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Assessment and quit rent boleh deduct
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straw
post Apr 18 2013, 01:36 PM


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hi pjm ur thread here for refinancing loan, is the interest deductible? thanks.
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