Assume monthly basic salary is RM4000
If your monthly EPF contribution is 11% ( RM440 ), taxable income = RM3560, income tax payable = RM77

If your monthly EPF contribution is 8% ( RM320 ), taxable income = RM3680, income tax payable = RM109

Conclusion : If you choose to contribute 8%, you will end up paying more income tax to the government, which will make the government richer.

Finance Minister Najib said this measure is meant to boost up the slow-down market, but from this example we see that the money does not go into the market.

Instead the money goes direct into the government's pocket through the greater amount of income tax that we will have to pay.

Obviously this measure does not help the market at all

Hmm...good point there

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

Only happen to those yearly EPF less than 6k

 

but even if exceed 6k, less EPF does automatically mean more taxable income

That's a lie. EPF contributions are taxed already. If EPF contributions were tax exempt, you would be calculating your income tax on your gross income minus EPF contributions. Like say a person makes 10k. If his EPF portion were tax exempted, you will only calculate tax on the 8.9k (under 11% contribution), not 10k.

If you mean PCB (Potongan Cukai Bulanan) calculation, it is actually quite complicated, even though you can refer to LHDN for sample calculation

Good point. Kena tanya kat kawan aku at LHDN. Thanks Seager for raising this question. I love you.

Deswai I asked, if anyone can confirm if the deductions are right

True only for the first 11 month, but all will reconcile at December month..... So no effect at the end of december / or doing BE

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

i still wonder. after gst. why still no reduce income tax???

Good point. Kena tanya kat kawan aku at LHDN. Thanks Seager for raising this question. I love you.

i still wonder. after gst. why still no reduce income tax???

Money market hold up due to .....................

The money market become tight & ask u guys spend more to solve it.

everybody spend more  -- > money turnaround faster for gst

Go learn LHDN formula properly before state a fact....

 

Uh only employers portion of epf is not taxed. So the change in the employees portion of the tax to u should be no implication unless u dun get the full rm6000 epf /life insurance relief. So to those within the narrow band of rm3500 to rm5000 will be affected (below tht u dun pay tax anyway)

Source: study tax in acca and was involved in some tax work in pwc.

Kawan aku takde kat opis laa pulak. Lelz. Btw she is hhhnnnghhhhh lady 

Money used to calculate tax includes whatever that enters your EPF.
Whether you put 8% or 11%, it is taxed.

Basically what happens is that most Malaysians, lower - middle income bracket already no more money. So gov allow you take 3% back instead of contributing to EPF, so this money can be spent, and out of the 3% you take back, 6% of that amount will eventually to go government because of GST

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

Below 5k 0% no?

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

If u earn YEARLY 5k only, then yes u dont have to pay tax.

But how did u survived with 5k annual income?!

thats cuz you bloody dont pay tax.

for CY2015, my salary grew by 9%, and my after tax salary grew by 10%

This is due to the 1%-2% lower tax rates for all brackets, and higher brackets.
the only reason you dont "feel" income tax reduction, as you are climbing the brackets

ie: you earn more money, hence moving from 13% to 16% to 20% to 24% bracket. then your after tax salary will grow slower compared to your salary.

KUALA LUMPUR, Oct 23 — For the first time, a national budget has made provision for tax relief for children who provide for their parents.

Budget 2016 provides tax relief of RM1,500 for the mother and RM1,500 for the father.

“The relief is subject to the condition that each parent does not have income exceeding RM2,000 a month and must be 60 years and above,” said Prime Minister Datuk Seri Najib Tun Razak when tabling Budget 2016 in the Dewan Rakyat today.

Najib, who is also the finance minister, also announced an increase in tax relief from RM1,000 to RM2,000 for each child below 18 years of age from year of assessment 2016.

He also announced an increase in the tax relief:

from RM3,000 to RM4,000 for individual taxpayer whose spouse has no income.

from RM6,000 to RM8,000 for each child above the age of 18 years who is studying at local or foreign institutions of higher learning from year of assessment 2016.

from RM6,000 to RM8,000 for disabled child above the age of 18 years who is studying at local or foreign institutions of higher learning, from year of assessment 2016.

“The existing tax relief for parents with a disabled child is RM6,000. This means that if the disabled ch8ld continues his or her education in local or foreign institutions, the total relief allowable is RM14,000,” he said.

Najib also said that to enable more employees to benefit from the Social Security Organisation (Socso), the eligibility for mandatory contribution would be increased from a monthly salary of RM3,000 to RM4,000.

“This adjustment will benefit 500,000 employees. Upon the death of the contributor, during the term of employment, the next-of-kin will receive a monthly payment of up to 90 per cent of his last-drawn monthly salary,” he added. — Bernama

the more i read, the more headache i get.. 

Good point. Kena tanya kat kawan aku at LHDN. Thanks Seager for raising this question. I love you.

If u earn YEARLY 5k only, then yes u dont have to pay tax.

But how did u survived with 5k annual income?!

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Anyone working in income tax capacity/ HR can confirm if the deductions above are right?

u gaji /k standard doesn't make any difference la.

Pelepasan Cukai for KWSP is up to RM6K/year only. So any contribution more than 6K will be taxable, for example if your annual KWSP contribution is 10K than the difference of 4K will be taxable.

but for other who have average salary less than ~ 5K/mth (rough figure), they might ended up paying more tax as their "pelepasan cukai" will be even less than before due to lesser KWSP contribution which will be lower than 6K.

That's a lie. EPF contributions are taxed already. If EPF contributions were tax exempt, you would be calculating your income tax on your gross income minus EPF contributions. Like say a person makes 10k. If his EPF portion were tax exempted, you will only calculate tax on the 8.9k (under 11% contribution), not 10k.

its not 5k.

the threshold is RM6k EPF contribution

EPF contribution is at least 11%+11%-12% which is 23% of base salary.

to achieve RM6k per annum of EPF contribution, your base salary will be RM6k/0.23%=RM26,000 per annum.

most people, with one or two month bonus, will get RM26,000 per annum. even graduates.

did a fast calculation



just estimate only.. consider individual exemption only..
any HR/tax master can correct me if i'm wrong..

poorfags will be taxed higher but not so much that it eat up the whole 3%
either way, its a middle-class BR1M.. cukurrrrr...