Karam, a Malaysian tax resident, is married to Susan and has a 19-year-old son, David. David is pursuing a full-time degree at a local Malaysian university and received a full scholarship from a multi-national company in Malaysia for his university fees. Susan has no income. Karam is employed by Olive Sdn. Bhd. as an operations manager based in Ipoh, Malaysia. Details of his employment income for the year 2020 are as follows:
A salary of RM48,000. An entertainment allowance of RM3,000. During the year 2020, Karam spent RM2,000 on entertaining the companys clients. Employees provident fund (EPF) contributions by Olive Sdn. Bhd. of RM5,760. Karam made EPF contributions of RM5,280.
Olive Sdn. Bhd. also provided Karam with the following benefits during the year 2020:
Semi-furnished accommodation. Olive Sdn. Bhd. paid a monthly rental of RM2,100 for an apartment which included RM100 for the furniture in the lounge and dining room. Medical benefits of RM250
Karam also runs a part-time business selling computer games software. Details of his business income for the year 2020 are as follows:
Adjusted income RM30,000 Capital allowances RM5,000 Unabsorbed business loss brought forward RM1,000
In addition, in 2020, Karam received RM3,000 as a commission from his neighbour for assisting him in securing a buyer for the sale of the neighbours small office, home office (SOHO) unit. Details of Karams other expenditure for the year 2020 are as follows:
Medical expenses for a weight reduction and wellness programme for his wife of RM2,000. A donation of goods worth RM10,000 to an approved institution. Deferred annuity premiums paid of RM3,500. Books purchased for his own personal use of RM1,200.
Required:
Compute the income tax payable by Karam for the year of assessment 2020. Note: You should indicate by the use of the word nil, as appropriate, any item referred to in the question for which no adjusting entry needs to be mad
Advise Karam and Susan how they should manage their taxable income to maximising the relief and rebates available.
is pursuing a full-time degree at a local Malaysian university and received a full scholarship from a multi-national company in Malaysia for his university fees. Susan has no income. Karam is employed by Olive Sdn. Bhd. as an operations manager based in Ipoh, Malaysia. Details of his employment income for the year 2020 are as follows: -A salary of RM48,000. - An entertainment allowance of RM3,000. During the year 2020, Karam spent RM2,000 on entertaining the company's clients. - Employees' provident fund (EPF) contributions by Olive Sdn. Bhd. of RM5,760. Karam made EPF contributions of RM5 280 Olive Sdn. Bhd. also provided Karam with the following benefits during the year 2020: - Semi-furnished accommodation Olive Sdn. Bhd. paid a monthly rental of RM2,100 for an apartment which included RM100 for the furniture in the lounge and dining room - Medical benefits of RM250 Karam also runs a part-time business selling computer games software. Details of his business income for the year 2020 are as follows: Adjusted income RM30,000 Capital allowances RM5,000 Unabsorbed business loss brought forward RM1,000 In addition, in 2020, Karam received RM3,000 as a commission from neighbour assisting him in securing a buyer for the sale of the neighbour's small office, home office (SOHO) unit. Details of Karam's other expenditure for the year 2020 are as follows: Medical expenses for a weight reduction and wellness programme for his wife of RM2,000. - A donation of goods worth RM10,000 to an approved institution - Deferred annuity premiums paid of RM3.500. -Books purchased for his own personal use of RM1,200 Required: a) Compute the income tax payable by Karam for the year of assessment 2020. Note: You should indicate by the use of the word 'nil', as appropriate, any item referred to in the question for which no adjusting entry needs to be made in the tax computation (10 marks b) Advise Karam and Susan how they should manage their taxable income to maximising the relief and relates available 1) marles) is pursuing a full-time degree at a local Malaysian university and received a full scholarship from a multi-national company in Malaysia for his university fees. Susan has no income. Karam is employed by Olive Sdn. Bhd. as an operations manager based in Ipoh, Malaysia. Details of his employment income for the year 2020 are as follows: -A salary of RM48,000. - An entertainment allowance of RM3,000. During the year 2020, Karam spent RM2,000 on entertaining the company's clients. - Employees' provident fund (EPF) contributions by Olive Sdn. Bhd. of RM5,760. Karam made EPF contributions of RM5 280 Olive Sdn. Bhd. also provided Karam with the following benefits during the year 2020: - Semi-furnished accommodation Olive Sdn. Bhd. paid a monthly rental of RM2,100 for an apartment which included RM100 for the furniture in the lounge and dining room - Medical benefits of RM250 Karam also runs a part-time business selling computer games software. Details of his business income for the year 2020 are as follows: Adjusted income RM30,000 Capital allowances RM5,000 Unabsorbed business loss brought forward RM1,000 In addition, in 2020, Karam received RM3,000 as a commission from neighbour assisting him in securing a buyer for the sale of the neighbour's small office, home office (SOHO) unit. Details of Karam's other expenditure for the year 2020 are as follows: Medical expenses for a weight reduction and wellness programme for his wife of RM2,000. - A donation of goods worth RM10,000 to an approved institution - Deferred annuity premiums paid of RM3.500. -Books purchased for his own personal use of RM1,200 Required: a) Compute the income tax payable by Karam for the year of assessment 2020. Note: You should indicate by the use of the word 'nil', as appropriate, any item referred to in the question for which no adjusting entry needs to be made in the tax computation (10 marks b) Advise Karam and Susan how they should manage their taxable income to maximising the relief and relates available 1) marles)
