Hi:

I am initially looking to buy a house with budget around RM300k with 90% loan from bank I am just nice to qualified.

Now my Relative from Thailand, wanted to sponsor me about 50% of the cost, but she wanted me to buy a bungalow instead of normal linked or semi-D, and the bungalow in my area are selling at RM500k and above...ok...even at RM600k, with his 50% sponsor I am still able to secure for a loan...now the problem is...when LHDN come and audit my purchase, will I be in deep trouble because technically speaking with my earning I am not qualified to purchase the house.

I think you wont get into trouble because to them this is small matter compare to company fraud and such. And also you can prove that 50% money is from your relative right?

Try to declare in LHDN that the money comes from your relative perhaps can..correct me if i am wrong..

As long as you can prove the relationships between you and your relative, then it's out of question for LDHN to trouble you.

So should LDHN looks for primary students where they got the money from?

As i know. If you do the installment to the bank. LHDN will lazy to check on you already. Except cash in one shot.....

Photostat the banker cheque or bank debit slip of the transfer & other relevant documentation.

Keep it as record.

When LHDN query, show them to prove where your money's from.

As long as u didn't steal the $ u shouldn't be worried even if ur questioned by the authorities for it was given to you

OK,thing has been changed.

Now instead of putting 50% downpayment, I am paying 100k as downpayment for a RM650k house...I can secure a loan from bank with installment of RM5k per month.
However, I definitely can't afford RM5k per month without sponsor from relative but I definitely can prove that I can afford 100k downpayment due to many 5 years working.

I've heard that if I get 80% to 90% of loan from bank, I will be safe from LHDN audit is this true?

if u can't afford rm 5K per month, at the first place, why u wanna take loan that need u to pay that amount monthly?

just asking... btw, the choice is yours...

tq.

The story is like this, my aunty (foreign citizen) wanted to buy a property and put my name as the owner, she has a business where she wanted to invest in property here so she could escape some tax in her country.

The monthly installment will be paid by her.

no worries at all if u keep all ur receipt

keep the proof of source of money u got to support ur purchase.

The question is this.

Would the bank approve your loan, when your income on paper can't sustain a RM5k monthly instalment.

They will, I can provide them with FD statement as supportive document.

@virus,
Is an FD statement good enough as supportive document to bank for housing loan? I could put in RM1m today just to show it to the bank and then take it out immediately after the loan is approved.

I have joint account with my father, several hundred thousands...already been there for about a year. I am also given privelege status on the bank, so I guess this is enough to secure me a loan.

My main concern is how to avoid audit from LHDN? I heard that if I loan 90% then LHDN will not bother to check, how true is that?

It could be pledged to the bank. Think out of the box .

Aiya, u got several hundred thousands in FD, u got RM100k+ in savings.

Why worry about LHDN? Like I mentioned b4, when they query, just show them how you got the money from.

Well of course, if you're evading tens of thousands income tax per year!! U should be worried.

Anyway, 2 things which usually attract LHDN's attention. Buying new house (NEW not 2nd hand) and new car (over the range of RM100k).

@SKY 1809,
Yes U can pledge the FD to the bank but that doesn't mean U won't withdraw the $ from the bank upon approval of the home loan.

@viruz,
scorgio is right - if U haven't evaded taxes U shouldn't get into problem with LHDN. As to how U got the $? Well, tell them it was a love gift *grins*

Thankfully, I haven't yet been questioned by LHDN but like I said, if U haven't done anything wrong there's nothing to worry about.

@scorgio,
New car above RM100k is quite common isn't it?

This post has been edited by tinkerbel: Jul 9 2008, 02:19 PM

If you have a property loan, you too can sell your property , right ?

But you still need to pay back the loan.

Can you suggest a way to walk away with all the money, and not paying back to bank ?

I am interested to learn from you.

@SKY 1809,
I don't know of a way to default payment to banks. What I'm trying to say is that I'm not too sure if banks will take into account the $ U have in ur FD when processing a home loan because that $ is withdraw-able anytime.

The discussion is not about being unable to withdraw the $ in FD or sell the house but more towards getting a home loan approved with insufficient monthly income to pay monthly installments and using $ in FD to proof that U haf the financial capability to pay.

Depending on ur declared income.

If ur declared income is RM4000 monthly or higher. Then of course no issue.

But if u only declare RM3000, and u bought a Honda Accord or Toyota Camry that kind of car.

Hehe... I won't be surprised if LHDN officials come knocking at ur door.

@scorgio,
I haven't done anything wrong so I don't see Y LHDN officials should waste time knocking on my door

Hello... pledging FD = the receipt will be in the bank's custody.

So how can you withdraw the money without a receipt?

As for ur question above, the property title has to be charged to the bank b4 the loan is released.

Which mean, u can't perform transfer b4 the title's being redeemed.

The bank has a panel of lawyers working for them, they are not stupid.

5 years working already got 100k ... not bad . Anyway, your relative is very nice to you ... half of 650k is quite a lot O.o

I knew u can LEGALLY afford something more expensive than that.

@scorgio,
If U pledge the FD to the bank then perhaps it's possible but to show the bank U haf $ in the FD I don't think that is workable. Ah well, I'm no banker so I wouldn't know plus I haven't been in such a situation before either *grins*

Most of us CAN afford it; we just don't wish to spend too much $ on something that depreciates too quickly!

FDs pledged for loans are workable for many foreign banks, but not too sure with local banks' culture . Also widely used to secure business loans .

Once pledged, you cannot use this FD bcos it is locked up and becomes bank's asset if defaulted.

I think you are cash rich, but lacking the skills to put it into " better use".

This post has been edited by SKY 1809: Jul 9 2008, 06:14 PM

@SKY 1809,
I suppose if it's a 'pledge' it should be possible. It perhaps might be a better idea to get a flexi loan and put the $ available in FD to contra off some interest rates on the home loan package *shrugs*

Hi Tinkerbel,

discussion is related to TS, not yours. You have the problem of "IF I buy cash."

Plse do not compare the poor with the rich. diff story.

@SKY 1809,
I am not discussing MY issue - I merely commented on the possibility of getting a home loan through show of FD receipt!

HIS CASE is not qualifying a 90% loan bcos of low taxable income.

Banks also could consider your "other" incomes, not necessary must be one reported to Income Tax.



This post has been edited by SKY 1809: Jul 9 2008, 07:19 PM

All,

There is a FUNDAMENTAL question that has not been asked. Is the money given by relative from Thailand taxable?? If it is and when you are queried by LHDN and you said the money is from Thailand, you will be charged with tax evasion.

Dreamer

In theory , no tax.

But, you need to prove the source of money where it comes from. It is not logical for a poor relative to give you so much money. What is her status ?

And you always have the risk of "thorough investigation." of your all assets.

This post has been edited by SKY 1809: Jul 9 2008, 08:27 PM

Even without a proper/sufficient payslip/epf/tax you can still get a loan if you have enough money in your banks. Of course the approval chances might not be that high, but it is still one of the method.

<Just saw your other post she's a foreign citizen>
2. What business or occupation she's in, that makes her so wealthy?
3. Why she chose you instead of other relatives?
4. So you're helping her with tax evasion?

It is not just LHDN you'll be worrying about, banks and other government agencies could be suspicious that you're into money laundering.

This post has been edited by bbjslee: Jul 9 2008, 07:47 PM

Tinkerbel, if one person has enough amount of FD or investment combination to qualify as a priority banking member.

Then, the bank can treat the case individually.

@scorgio,
OkieSs... now I know

It is way income tax dept gets to know.

No incomes to declare, but declaring a lot of assets. Falls from heaven.

The golden answer, "I bought the assets cheap mah".

@scorgio,
Yeah.. a friend sold it to me for RM1 *grins*

Those who sold you the assets will have to answer for you. Many lands were stolen in Selangor.

This post has been edited by SKY 1809: Jul 9 2008, 09:30 PM

U never heard of under table? Between buyer & seller.

SKY 1809,

Who say so??? Under Malaysia tax system, you are TAXED when the money come into Malaysia. What makes you think that it is NOT taxable??

Dreamer

When money is given as a GIFT ( voluntary payment and non contractual ) let say from a parent to child.

It is not considered as SOURCE OF INCOME. One off situation rather than on regular basis. However, GIFTs from employers to employees could be deemed as employment incomes ( if not , could be abused ).

Gain on Share Investments ( CAPITAL GAINS ) are not taxable in Malaysia. Likewise. applicable to gains from oversea markets brought back to Malaysia.

Or it could a settlement of a debt owed to you ( whereby you sent out money earlier ).

Income Tax does not tax on cashflows ( money circulating in the system ) but on SOURCES OF INCOMES.

For Incomes from outside Malaysia remitted back to Malaysia , tax laws change quite often in this area. Not too sure of the latest rulings. And so the complications of non resident or resident rules.

Also, Malaysia has Double Taxation Treaty signed with other countries for avoiding double tax imposed on persons or companies.

Correct me if I am wrong.

---

Added on July 10, 2008, 10:28 amTax Incentives by Legislation


*8) Incentives for Malaysian Experts Abroad To Return To Work In Malaysia*
To encourage Malaysians experts who are abroad to return to serve
Malaysia the following incentives are granted:

(i) income remitted within 2 years from the date of arrival will be
exempted from income* *tax;

(ii) two motorcars registered in the country of origin for at least 6
months in the name of either the husband/wife/children will be exempted
from import duty and sales tax; and

(iii) husband/wife and children of a Malaysian citizen will be given
permanent resident status within 6 months from the date of arrival.

These incentives will be effective from 1 January 2001. Applications for
this incentive should be submitted to a Special Committee in the
Ministry Of Human Resources.


Last Update Date: 10 Jul 2008 8:36 am

This post has been edited by SKY 1809: Jul 10 2008, 11:11 AM

SKY 1809,

<<Also, Malaysia has Double Taxation Treaty signed with other countries for avoiding double tax imposed on persons or companies. >>

Only with SOME countries and in some case limited to some jobs. For example, Malaysia's TAX Treaty with USA only apply to pilot and stewardess, and ship captains and workers.


<<*8) Incentives for Malaysian Experts Abroad To Return To Work In Malaysia*>>

Which does not apply in this case.


<<Gain on Share Investments ( CAPITAL GAINS ) are not taxable in Malaysia. Likewise. applicable to gains from oversea markets brought back to Malaysia.

Or it could a settlement of a debt owed to you ( whereby you sent out money earlier ).

Income Tax does not tax on cashflows ( money circulating in the system ) but on SOURCES OF INCOMES.

For Incomes from outside Malaysia remitted back to Malaysia , tax laws change quite often in this area. Not too sure of the latest rulings. And so the complications of non resident or resident rules.>>>

Who say so?? Malaysia do not TAX on income from oversea. Malaysia TAX on remittance into Malaysia. This is different from any other countries in the world.

I am just saying it is complicated enough that a person cannot just say that it is NOT taxable.

Dreamer

I talk of money given as a gift NOT as income given by the relative as per TS asked. It is not an across the board answer ( or answering to your problems directly ). I was not making any comparison with US or so bcos I am not familiar with US Tax laws. There is a diff between MONEY and Income remitted to Malaysia. And it is very risky to apply tax law across the board generally.

I also said it is in thoery bcos, practically it is not easy for a relative to give away few hundred K . Not easy to make Income Tax people to believe also.

Related to your Q.

Tax Resident : Incomes received * in Malaysia from Outside Malaysia are still subjected to tax . ( I am not able to track back since when it is not taxed ). Correct me if I am wrong.

Anyway, thanks for sharing yr info with us.

* remittance/brought back to Malaysia.

This post has been edited by SKY 1809: Jul 11 2008, 01:34 PM