Not all allowances are tax exempted.

If you received HP benefits or company is paying you the bill, you need to declare back as benefit in kind (BIK) which will add into your gross taxable income as well.

The introduction of BIK years back is to close the loop hole as you mentioned.

I don't think meal, house allowances is tax exempted as well.
Correct me if I am wrong.

This post has been edited by cherroy: Jul 5 2009, 11:39 PM

Simplesmile,

Yes, you can construct you wages in that kind of structure, but bare in mind, the tax allowance issue can be changing year to year, sometimes, it is kind of troublesome for company to restrucuture the salary to meet the changing rules. Company generally won't bother to change the whole system (especially for company having many employee one), as it means troublesome in acounting as well as auditing issue.

Sometimes, it is not wise to save up some on tax allowance issue by reducing the basic salary and large portion to allowance side.
Eg. previously you have 5,000 basic and no allowance. Now you want to save a bit of tax, then change it to 4,000, and lot of allowance that allowed for tax relief.

Why I said so, because if company want to retrench the employee, compensation is solely based on basic alone.

As far as I know, there is no specific details about the book issue.
As long as those are books, then it is ok.

Where got this kind of ruling??

Please do not mislead others.

You cannot say like this one, if they audit time, one will need to pay the wrongly claimed tax relief + penalty.
There is no such thing no so strict.
Either yes & no.
If the rules stated what type of relief can be claimed, then it is.
If not stated, then cannot.

4) Only those donation that has applied for LHDN tax relief can. Other ordinary donation cannot.

No hire purchase on vehicle has no tax relief.