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Type of Benefit-in-Kind and Perquisites that Exempt from Tax
Million System
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PCB 2013
MTD is to be deducted from the employee’s taxable remuneration only. All the tax exemption on allowances, benefit-in-kind and perquisites shall be excluded from the remuneration for MTD purposes. Any amount exceed the restricted amount shall be taxable. Please refer to table below:-
All the tax exemption on allowances, benefit-in-kind and perquisites shall reported in the EA Form, section G
– TOTAL TAX EXEMPT ALLOWANCES / PERQUISITES / GIFTS / BENEFITS. (Effective in Year 2013)
Type of benefit-in-kind and perquisites that exempt from tax are as follows:
| Allowances / Perquisites / Gifts / Benefits | Restricted amount (RM) | |
| a. | Petrol card, petrol allowance, travelling allowance or toll payment or any of its combination for official duties.
If the amount received exceeds RM6,000 a year, the employee can make a further deduction in respect of the amount spent for official duties. Records pertaining to the claim for official duties and the exempted amount must be kept for a period of 7 years for audit purpose. |
RM 6,000.00 |
| b. | Child care allowance in respect of children up to 12 years of age. | RM 2,400.00 |
| c. | Gift of fixed line telephone, mobile phone, pager or Personal Digital Assistant (PDA) registered in the name of the employee or employer including cost of registration and installation. | Limited to only 1 unit for each category of assets |
| d. | Monthly bills for subscription of broadband, fixed line telephone, mobile phone, pager and PDA registered in the name of the employee or employer including cost of registration and installation. | Limited to only 1 line for each category of assets. |
| e.
|
Gift of new personal computer (one unit). „Personal computer. means a desktop computer, laptop computer and handheld computer but does not include a hand phone with computer facilities. [ P.U. (A) 191/2008].
|
Limited to 1 unit
only (up to Y/A 2010 only)
|
| f.
|
Perquisite (whether in money or otherwise) provided to the employee pursuant to his employment in respect of:-
(i) past achievement award; (ii) service excellence award, innovation award or productivity award; and (iii) long service award (provided that the employee has exercised an employment for more than 10 years with the same employer).
|
2,000
|
| g.
|
Parking rate and parking allowance. This includes parking rate paid by the employer directly to the parking operator.
|
Restricted to the
actual amount expended
|
| h.
|
Meal allowance received on a regular basis and given at the same rate to all employees. Meal allowance provided for purposes such as overtime or outstation / overseas trips and other similar purposes in exercising an employment are only exempted if given based on the rate fixed in the internal circular or written instruction of the employer.
|
Restricted to the
actual amount expended
|
| i.
|
Subsidised interest for housing, education or car loan is fully exempted from tax if the total amount of loan taken in aggregate does not exceed RM300,000.
If the total amount of loan exceeds RM300,000, the amount of subsidized interest to be exempted from tax is limited in accordance with the following formula : A * B/C Where;
A x B/C
A = is the difference between the amount of interest to be borne by the employee and the amount of interest payable by the employee in the basis period for a year of assessment;
B = is the aggregate of the balance of the principal amount of housing, education or car loan taken by the employee in the basis period for a year of assessment or RM300,000, whichever is lower;
C = is the total aggregate of the principal amount of housing, education or car loan taken by the employee. |
Example : Normal remuneration : RM5,000 per month
Car allowance : RM 800 per month
Meal allowance : RM 300 per month(Exempted)
Childcare allowance : RM 300 per month(Exempted – limit to RM2,400 per year)
Total : RM6,400 per month
To determine MTD amount, taxable income as follow:
Normal remuneration : RM5,000 per month
Car allowance : RM 800 per month
Childcare allowance : Taxable on allowance > RM2400 during the year.
Total taxable remuneration : RM 5,800 per month
Download here for more detail on exempt benefit-in-kind and perquisites
ALLOWANCE NOT EXEMPTED
- PHONE ALLOWANCE
Where an employee receives a fixed allowance for telephone, the full amount of that telephone allowance is taxable as part of his gross income from employment under paragraph 13(1)(a) of the ITA 1967.