QUESTION 1 Mr. Sam is a Malaysia resident employed as a general manager by Lotus Sdn Bhd for the last three years. For the years ended 31 December 2020 he received the following employment income and benefits from the company: RM Salary per month 15,000 Bonus equivalent to three months salary 45,000 Entertainment allowance per month 3,000 Parking allowance 3,600 Mr. Sam was provided a new car worth RM180,000. The employer provided medical and dental care amounting to RM12,000 for him family. He was given a fully furnished bungalow house was to reside. The rental of the bungalow house was RM5,000 (of which RM1,000) was for the furniture. He incurred official entertainment expenditure of RM 7200 on behalf of the company. Mr. Sam was given the option to buy 3000 units of the companys shares at the price of RM3 per share on 10 March 2020. The market value of the share was RM4.50 per share. He exercised his option on 28 August 2020 when the market value of the share was RM5 per share. Mr. Sam owns a house in Penang, and he rented it out for RM1,500 per month. The tenant vacated the house at the end of April and a new tenant came for the same rent in July. The total amounts shown in the rental receipts for the following months are as follows. Months RM January 2019 to April 2019 6,000 May 2018 to June 2018 Nil July 2019 to December 2019 9,000 The house vacant for two months during which Mr. Sam spent RM 3,000 for painting and repair works. He also spent RM12,000 extending the kitchen. The assessment and quit rent cost RM720 (including RM20 for late payment of quit rent). Mr. Sam paid housing installments of RM20,000 of which half went towards interest. He pays fire insurance of RM 1200 per annum. Mr. Sam has a wide portfolio of investments and he received: RM Single tier dividends 3,600 Interest from fixed deposits in Public Bank 3,000 Mr. Sam contributed 11% of his salary to the EPF. He signed up to pursue a Master in Business Administration degree at Monash University Sunway Campus and paid RM15,000 for his first semester fees. Mr. Sam is married to Grace who is home maker. They have three children aged 23, 19 and 14. His eldest daughter Deborah got married in July 2018. His elder son John is pursuing a medical degree in Monash University Sunway Campus and is fully supported by Mr. Sam. Mr. Sam bought a and purchased books for RM1,200 during the year which substantiated by receipts. He wants to practice a healthy lifestyle and hence purchased a treadmill machine for the family for RM3,999. Required: Compute the chargeable income of Mr. Sam for YA 2020. (TOTAL 25 MARKS) QUESTION 2 After a tax audit conducted by the Inland Revenue Board (IRB) on Mr. Sam, an additional assessment on tax and penalty for an incorrect return of RM37,500 was raised on 23 January 2020 for the year assessment 2018. On 21 January 2020, Mr. Sam filed an appeal in the prescribed form (Form Q) against the additional assessment with a written statement that it was excessive. As he did not hear from the IRB, Mr. Sam did not pay the RM37,500. On 30 June 2020, Mr. Sam changed his residential address but to date has not informed the IRB. On 30 November 2020, the IRB issued a certificate under Section 104 to prevent Mr. Sam from leaving Malaysia. The notification of the certificate was sent to his old address by registered post. Thus, Mr. Sam was not aware that the certificate has been issued. On 9 December 2020, Mr. Sam was stopped at the airport when he wanted to make a short business trip to overseas. Required: Comment on the validity of Mr. Sams tax appeal and the absence of a response from the IRB and explain whether the issue of the certificate on 30 November 2020 is lawful and whether Mr. Sam can sue the Government for denying him freedom of movement.