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Saturday, 31 October 2015

(The Star) ‘There’s relief for middle-class’

PETALING JAYA: Increases in reliefs under Budget 2016 can amount to significant tax savings for single-income middle-class families, says former Inland Revenue Board senior assistant director Yong Poh Chye (pic).

Interview with Yong Poh Chye, Tax Advisory and Management Services Sdn Bhd executive director on the Budget 2016, benefits to middle income groups. IZZRAFIQ ALIAS / The Star. October 27, 2015.
 
Yong said these increases – for a spouse who is not working (RM4,000, from RM3,000), child below 18 (RM2,000, from 1,000) and child above 18 in tertiary education (RM8,000, from 6,000) – totalled RM4,000.

He said an employee earning RM72,000 a year or RM6,000 a month could see his tax payable fall from RM2,100 (for 2015) to RM1,700 for (2016), translating to RM400 in savings (see chart).

“This means more disposable income for those entitled to these reliefs,” said Yong, who now runs a tax consultancy.

Many Malaysians in the middle-income group assume that they get little relief under Budget 2016 and will lose out in other ways due to higher costs.

 
But those increases in reliefs announced by the Government are targeted at the middle-income group.

Yong pointed out that these reliefs made no difference to lower-income families who would not be taxable.

However, those earning over RM3,000 a month, with children below 18 years old, will lose out on the RM100 schooling assistance.

From January 2016, this assistance will only be given to students from households with a monthly income of RM3,000 and below.

Yong said the RM100 direct financial assistance should have been maintained for all students.

“Students who get the money will be grateful to the Government and will realise why its important to pay their taxes when they grow up.”

The Government, however, has decided that the RM250 1Malaysia Book Voucher programme will continue. But to prevent misuse of redemption, it will only be allowed in designated bookshops.

The 1Malaysia People’s Aid (BR1M) for households with a monthly income of RM3,000 and below has also been raised from RM950 to RM1,000, while for households with a monthly income between RM3,001 and RM4,000, from RM750 to RM800.


Source : http://www.thestar.com.my/News/Nation/2015/10/31/Theres-relief-for-middleclass/