malaysia tax

Question 4 - Presentation Batik Uniform Sdn. Bhd. is a business owned by Mr. Rashid. Currently, Batik Unifom Sdn. Bhd. produces and distributes quality unifoms including industrial unifoms, medical apparels and safety apparels to various customers. For the year ended 31 December 2016, the company's financial statement is as follows: Note RM1000 RM000 Sales 2,300 Less: Cost of sales (970 Gross profit 1,330 Less: Operating expenditure Marketing & Promotion Expenses Payroll costs Employees Provident Fund (EPF) Professional fees and subscriptions Depreciation Utilities Provision for doubtful debts Other expenses Donations ovau AWN Add: Other income Net profit before taxation Notes: Included under cost of sales are: Damaged stocks written off Provision for the foreign exchange loss expected upon payment ofraw material textile) purchased RM27,000 RM32,000 Marketing andpromotionexpenses include: Donation of school unifoms to Bestan School Participation in an approvedintemational trade fairs Customers entertainment relating wholly to sales RM 5,700 RM14,300 RM 3,000 Included under payroll costs are: Medical expenses of staff and their family Provision for retirement benefits Mr. Rashid's salary Employees salary Salary of two disabled operators RM 47.000 RM 50.000 RM 75.000 RM310.000 RM 28.000 4. Included under EPF are contributions for: Mr. Rashid Employees RM10,000 RM50.000 Included under professional fees and subscriptions are Audit and tax fees RM 9,800 Annual subscription fee to ASEAN Manufacturers Association RM 200 Depreciation expenses comprise of depreciation for sewing machine RM35,000 depreciation for office equipment RM5,000, depreciation for ce and fittings, RM5,000 and depreciation for vehicles, RM15,000. Utilities expenses are expenses incurred for the purpose of business. It includes cost of electricity, water, telephone bills and rental of factory. 8. Provision for doubtful debts comprises: General provision for doubtful debts Specific provision for doubtful debts Tra de debts written off Other expenses consist of: Staff refreshments andannual dinner Cost of new computerized security system RM 8,000 RM14,000 RM 8,000 RM25,000 RM45,000 10. Donations: A cash donation of RM15,000 was made to the Heart Foundation of Malaysia (an approved institution). Other income comprises income derived from Malaysia as follows: Tax exempt dividend RM17,000 Interest on deposits frombank licensed under the Banking and Financial Institution Act 1989 RM23,000 Capital allowance due for the year of assessment 2016 is RM80,000. This allowance has included all the qualified assets bought during the year. Required: Starting with the net profit before taxation compute the tax payable of Bank Ufo Siha She for the year of assessment 2016. State your reason for the deductibility or non-deacti o each of the item in your computation. Note: You should indicate by the use of the word nil'any item referred to the question which no adjusting entry needs to be made in the tax computation Suggested Template for solution: Items Less RM Add(+) RM 412,000 Explanation From Income Statement Net profit before taxation (1) Cost of sales Stock written-off Provision of foreign exchange loss Nil 32,000 Realised loss-allowable Non-allowable exp (2) Marketing & promotion Donation of uniforms Participation in approved fairs Customer entertainment (3) Payroll costs Medical expenses Prov. for retirement benefit Owner's salary Employees' salary Salary for handicapped staffs (4) EPF Mr Rashid Employees (50,000 - (19% x (310k - 28k) (5) Professional fees & subscriptions Audit & tax fees Subscription fee to AMA (6) Depreciation expense 1) Utilities (8) Provision for doubtful debts General provision Specific prov for doubtful debts Trade debts written off ? (9) Other expenses Staff refreshments Security systems (10) Donation Cash donation (11) Other income Dividend Interest 17,000 23.000 82,300 After statutory income After statutory income Adjusted income 735.920 653.620 Less: Capital allowance Statutory income from business (80.000) 573,620 Add: Other income Tax exempt dividend Interest income Aggregate income NI Nil Exempted Exempted 573,620 Less: Approved donations Total income 15.000 558,620 Sec 446) Less: Relief Self-Relief Chargeable income Multiply: Tax rate Tax Payable Less: Rebate Tax Charged Question 4 - Presentation Batik Uniform Sdn. Bhd. is a business owned by Mr. Rashid. Currently, Batik Unifom Sdn. Bhd. produces and distributes quality unifoms including industrial unifoms, medical apparels and safety apparels to various customers. For the year ended 31 December 2016, the company's financial statement is as follows: Note RM1000 RM000 Sales 2,300 Less: Cost of sales (970 Gross profit 1,330 Less: Operating expenditure Marketing & Promotion Expenses Payroll costs Employees Provident Fund (EPF) Professional fees and subscriptions Depreciation Utilities Provision for doubtful debts Other expenses Donations ovau AWN Add: Other income Net profit before taxation Notes: Included under cost of sales are: Damaged stocks written off Provision for the foreign exchange loss expected upon payment ofraw material textile) purchased RM27,000 RM32,000 Marketing andpromotionexpenses include: Donation of school unifoms to Bestan School Participation in an approvedintemational trade fairs Customers entertainment relating wholly to sales RM 5,700 RM14,300 RM 3,000 Included under payroll costs are: Medical expenses of staff and their family Provision for retirement benefits Mr. Rashid's salary Employees salary Salary of two disabled operators RM 47.000 RM 50.000 RM 75.000 RM310.000 RM 28.000 4. Included under EPF are contributions for: Mr. Rashid Employees RM10,000 RM50.000 Included under professional fees and subscriptions are Audit and tax fees RM 9,800 Annual subscription fee to ASEAN Manufacturers Association RM 200 Depreciation expenses comprise of depreciation for sewing machine RM35,000 depreciation for office equipment RM5,000, depreciation for ce and fittings, RM5,000 and depreciation for vehicles, RM15,000. Utilities expenses are expenses incurred for the purpose of business. It includes cost of electricity, water, telephone bills and rental of factory. 8. Provision for doubtful debts comprises: General provision for doubtful debts Specific provision for doubtful debts Tra de debts written off Other expenses consist of: Staff refreshments andannual dinner Cost of new computerized security system RM 8,000 RM14,000 RM 8,000 RM25,000 RM45,000 10. Donations: A cash donation of RM15,000 was made to the Heart Foundation of Malaysia (an approved institution). Other income comprises income derived from Malaysia as follows: Tax exempt dividend RM17,000 Interest on deposits frombank licensed under the Banking and Financial Institution Act 1989 RM23,000 Capital allowance due for the year of assessment 2016 is RM80,000. This allowance has included all the qualified assets bought during the year. Required: Starting with the net profit before taxation compute the tax payable of Bank Ufo Siha She for the year of assessment 2016. State your reason for the deductibility or non-deacti o each of the item in your computation. Note: You should indicate by the use of the word nil'any item referred to the question which no adjusting entry needs to be made in the tax computation Suggested Template for solution: Items Less RM Add(+) RM 412,000 Explanation From Income Statement Net profit before taxation (1) Cost of sales Stock written-off Provision of foreign exchange loss Nil 32,000 Realised loss-allowable Non-allowable exp (2) Marketing & promotion Donation of uniforms Participation in approved fairs Customer entertainment (3) Payroll costs Medical expenses Prov. for retirement benefit Owner's salary Employees' salary Salary for handicapped staffs (4) EPF Mr Rashid Employees (50,000 - (19% x (310k - 28k) (5) Professional fees & subscriptions Audit & tax fees Subscription fee to AMA (6) Depreciation expense 1) Utilities (8) Provision for doubtful debts General provision Specific prov for doubtful debts Trade debts written off ? (9) Other expenses Staff refreshments Security systems (10) Donation Cash donation (11) Other income Dividend Interest 17,000 23.000 82,300 After statutory income After statutory income Adjusted income 735.920 653.620 Less: Capital allowance Statutory income from business (80.000) 573,620 Add: Other income Tax exempt dividend Interest income Aggregate income NI Nil Exempted Exempted 573,620 Less: Approved donations Total income 15.000 558,620 Sec 446) Less: Relief Self-Relief Chargeable income Multiply: Tax rate Tax Payable Less: Rebate Tax Charged