Question
Khai, a mechanical engineer with UOE Sdn Bhd, retired from the company on 30 November 2018 upon reaching his compulsory retirement age and received gratuity
Khai, a mechanical engineer with UOE Sdn Bhd, retired from the company on 30 November 2018 upon reaching his compulsory retirement age and received gratuity of RM60,000. He has been working with the company since 28 December 2011. His employment income for the year 2018 is as follows:
| RM |
Salary (gross)
| 99,000 |
Entertainment allowances (50 percent of the allowances were used for official purpose)
| 10,000 |
Travelling allowances (20 percent of the allowances were used for private purpose)
Bonus | 11,000 |
- for the year ended 31 December 2018 paid in 2018 | 9,000 |
- for the year ended 31 December 2017 paid in 2018 | 8,000 |
Other benefits received by Khai are as follow:
- Khai was provided with four (4) holiday trips to various local resorts in Sabah, each costing at RM2,000, and addition special trip to Hong Kong costing at RM3,000. For all trips, both local and oversea, 20 percent of the costing is to cover cost of meals and accommodation.
- Khai was being provided with motorcar and fuel for his personal use. During the period of service in 2018, the annual value of benefits was RM3,600 and RM1,200 respectively. UOE Sdn Bhd also provided him a driver with the salary of RM600/month.
- Gardener provided and paid by UOE Sdn Bhd at RM300 per month. Additionally, UOE employed a domestic servant solely for his familys use at RM700 per month from 1 April 2018. This cost was reimbursed by UOE Sdn Bhd.
- UOE Sdn Bhd rented a fully furnished four-room bungalow in Jitra for RM2,400 per month (inclusive of furniture at RM400) for Khai. Two of the rooms in the house were not used by Khai and his family but reserved for the use of UOE Sdn Bhds clients when they were in Jitra. Khai was required to pay a nominal rent of RM500 per month to the employer.
For the year of assessment 2018, determine Khais adjusted employment income.
Income Tax Rate Year of Assessment 2018
Chargeable income calclution rate %
Chargeable income | calclution | rate % | TAX RM |
0,5000 | ON FIRST 2500 | 0 | 0 |
5001-20000 | On first 5000 Next 15000 | 1 | First 0 Next 150
|
20001-35000 | On first 20000 Next 15000 | 3 | First 150 Next 450 |
35001-50000 | On first 35000 Next 15000 | 8 | First 600 Next 1200 |
50001-70000 | On first 50000 Next 20000 | 14 | First 1800 Next 2800 |
70001-100000 | On first 70000 Next 30000 | 21 | First 4600 Next 6300 |
100001-250000 | On first 100000 Next 150000 | 24 | First 10900 Next 3600 |
250001-400000 | On first 250000 Next 150000 | 24.5 | First 46900 Next 36750 |
4000001-600000 | On first 400000 Next 200000 | 25 | First 83650 Next 50000 |
600001-1000000 | On first 600000 Next 400000 | 26 | First 133650 Next 104000 |
EXCEEDING 1000000 | On first 1000000 Next rinngit | 30 | First 237650 |
Year of Assessment 2018
No. Individual Relief Types Amount (RM)
1 Self and Dependent 9,000
2 Medical expenses for parents OR Parent Limited 1,500 for only one mother Limited 1,500 for only one father 5,000 (Limited) OR 3000 (Limited)
3 Basic supporting equipment for disabled self, spouse, child or parent 6,000 (Limited)
4 Disabled Individual 6,000
5 Education Fees (Self) (i) Other than a degree at Masters or Doctorate level-for acquiring law, accounting, Islamic financing, technical, vocational, industrial, scientific or technological skills or qualifications; (ii) Degree at Masters or Doctorate level-for acquiring any skills or qualification 7,000 (Limited)
6 Medical expenses for serious diseases for self, spouse or child 6,000 (Limited)
7 Complete medical examination for self, spouse, child - 500 (Limited)
8 Lifestyle: (i) Purchase of books journals, magazines, printed newspaper and other similar publications (except banned reading materials) for self, spouse or child; (ii) Purchase of a personal computer, smartphone or tablet for self, spouse or child; (iii) Purchase of sports equipment for any sports activity as defined under the Sports Development Act 1997 (excluding motorized twowheel bicycles) and gym memberships for self, spouse or child; and (iv) Payment of monthly bill for internet subscription 2,500 (Limited)
9 Purchase of breastfeeding equipment 1,000 (Limited)
10 Net saving in SSPN's scheme (total deposit in year 2018 MINUS total withdrawal in year 2018) 6,000 (Limited)
11 Child care fees to a Child Care Centre or a Kindergarten 1000 (Limited)
12 Husband/Wife/Alimony Payments 4,000 (Limited)
13 Disable Wife/Husband 3,500
14 Ordinary Child relief 2,000
15 Each unmarried child of 18 years and above who is receiving fulltime education ("A-Level", certificate, matriculation or preparatory courses). 2,000
16 Each unmarried child of 18 years and above that: (i) receiving further education in Malaysia in respect of an award of diploma or higher (excluding matriculation/preparatorycourses). (ii) receiving further education outside Malaysia in respect of an award of degree or its equivalent (including Master or Doctorate). (iii) the instruction and educational establishment shall be approved by the relevant government authority. 8,000
17 Disabled child 6,000 Additional exemption of RM8,000 disable child age 18 years old and above, not married and pursuing diplomas or above qualification in Malaysia @ bachelor degree or above outside Malaysia in program and in Higher Education Institute that is accredited by related Government authorities
18 Life insurance dan EPF INCLUDING not through salary deduction 6,000 (Limited)
19 Deferred Annuity and Private Retirement Scheme (PRS) - with effect from year assessment 2012 until year assessment 2021 3,000 (Limited)
20 Insurance premium for education or medical benefit INCLUDING not through salary deduction 3,000 (Limited)
21 Contribution to the Social Security Organization (SOCSO) 250 (Limited)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started