CHAPTER 5

Donation, Personal Reliefs & Rebates

Assoc. Prof. Dr. Idawati Ibrahim
Content
Concept of Aggregate Income, Total Income & Chargeable Income
Approved Donation
Personal Reliefs
Tax Liability
Rebates
Tax Payable/Refund
Tac Computation Format
Aggrgate
Income

Total Income

Chargeable
Income

Tax Liability

Tax
Payable/Refund
FORMAT OF TAX COMPUTATION
 S4(a) Business Income xxx Less: Reliefs
 S4(b) Employment Income xxx .…. xx
 S4(c) Dividend, Interest, Discount xxx ….. xx
 S4(d) Rental, Royalty, Premium xxx ….. xx (xxx)
 S4(e) Pension, Annuity xxx CHARGEABLE INCOME XXXX
 S4(f) Other Income Refer
xxx Tax: on first RM…. xx Tax Rate Table
AGGREGATE INCOME XXXX on next RM… x…% xx
Less: Current Year Business Loss (xx) Tax Liability xxx
Approved Donation (xx) Less: Rebates
TOTAL INCOME XXXX Personal/Spouse Rebates x
Zakat x
TAX PAYABLE x
Less: MTD (x)
NET TAX PAYABLE/(REFUND) XXX
Business Loss
 Sec..4(2)
 Business losses in the relevant year (current year loss)
… to be deducted FIRST from aggregate income (i.e. all sources of income) for
that YA
 Sec. 43(2)
 Unabsorbed business losses (b/f loss)
to be carried forward & to be utilised against future business income
[sec 4(a)] ONLY [i.e. all business sources – S4(a) only]
 Approved Donation S44 ITA 1967 [see p.153-158]
1. Cash donation to the government, a state government or a local
authority – S44(6)** **Cash wakaf:
2. Cash donations to approve. institutions/organizations/or social a. to a state religious authority
enterprise [limited to 10% of aggregate income]. b. To public University approved
3. Cash donation or in-kind for sports activity/Body [limited to 10% by the state religious
aggregate income] authority ; and
4. Cash donation or in-kind to approved project of national interest [limited c. Cash endowment contribution
to 10% aggregate income] to a public University
5. Cash contribution to public libraries, school libraries/higher education  Donations made must be
libraries [restricted to RM20,000]
evidenced with original
6. Cash donations or gift of medical equipment to any
receipts
healthcare facility approved by the MOH [limited to
RM20,000]  Donations are to be deducted
7. Cass donation or in-kind for public facilities for the benefit of last
disabled persons.  Unutilized donations cannot be
8. Gift of paintings to the National/State Art Gallery carried forward (i.e. permanent
9. Gift of artefact, manuscript or painting to the Federal/State Government. loss)
10. Zakah on Business
Personal Reliefs [p.158]
 Available for resident individual  Deferred annuity & private retirement
 They are allowed as deductions from total income in
scheme
arriving at chargeable income
 Relevant section - S46 – 49
 Serious disease
 Self relief RM9,000  Parent medical relief
 Disabled person, further RM6,000  Supporting equipment for disabled
 Own study fees, RM2,000/YA max total RM7,000
person
 Parents’ med treatment/care/exp max RM8,000
 Basic supporting equipment  Education & medical insurance
(OWCP-own/wife/child/parent) max RM6,000  Education fees
 Medical expenses for serious diseases OWC, max
RM10,000, including max RM1,000 for complete  Net saving to SSPN
medical examination + COVID&mental health  Contribution to SOCSO
 Wife/husband relief
 Child relief  Lifestyle expenses
 Disabled child  Breastfeeding equipment
 Disabled child studying HE
 Life insurance
 Fees for childcare center/kindergarten
 EPF  Domestic travelling
 18

Self & Spouse Relief

• Taxpayer/Self [S46(1)(a) ]
 RM9,000

 + RM6,000 for disabled [S46(1)(e)]

• Wife/Spouse/Alimony
 RM4,000 [S47(1)(a)]

 + RM5,000 if disabled [S47(1)(b)]

 Applicable to wife under separate assessment

 not applicable under separate assessment
 alimony payment be allowed as wife relief
 Child Relief [Sec.48]
 Child ..
CHILD RELIEF:
 A legitimate child
 NormalChild is under 18 years old
 A step child
 an adopted child [RM2,000]
 Child relief is given to either husband/wife  Disabled Child, irrespective of age
based on selection made by them. They [RM6,000]
may allocate the number of child relief
among them.  Child is over 18 years old BUT
 In case of divorce, if there is 2 claims, each receiving full-time higher
of them entitle to 50% of child relief. education (local or overseas)/
 Child is unmarried and maintained by
serving under
resident parent.
articleship/indenture [RM8,000]*
 Child relief is not given if the child’s  *Additional [RM6,000] relief for
total income exceeds the relevant child
relief. disabled child under this category
= [RM14,000].
Life Insurance, EPF, Approved Schemes
1. Life insurance premium restricted to RM3,000;
2. Contributions to EPF or any approved scheme restricted to RM4,000
3. Contribution under any written law relating to widow, widower or
orphan’s pension or under any approved scheme restricted to RM4,000.
The amount (1) to (3) shall not exceed RM7,000.
Public servant under pension scheme?
Tax Liability
Tax rates for the resident individual is a progressive tax rate (0% - 30%)
Tax rate for non-resident ?
Check for YA2023 tax rates
Rebates & Final Tax Liability/Refund
Rebates Final Tax Liability/Refund
Personal rebate RM400 Zakat
Spouse Rebate RM400 MTD
Section 132/133
Joint Assessment OR Separate Assessment
Separate Joint
Both can claim reliefs Spouse relief
Reliefs depend on who is the
taxpayer.
THANK YOU!!!