How to save tax on employee remuneration? Part 1

Update of Extension of SSM Beneficial Ownership (BO) Reporting

How to save tax on employee remuneration? Part 1

Tax Planning (via Tax Exempted Benefits) on Employee Remuneration

A simple technique on tax planning for taxpayer is to use tax exempted (free) benefits available under the sky.

A simple example to illustrate :

For years… Ah Huat (not director) receive RM10,000 monthly salary and subject to PCB RMx per month?

After tax planning..

Now Ah Hua receive RM8,000 monthly salary and RM2,000 child care benefit. Ah Hua monthly PCB is lower that RMx previously.

What is tax exempted benefits available?

1. Dental benefit
2. Child-care benefit

3. Food and drink provided free of charge
4. Free transportation between pick-up points or home and the place of work (to and from)
5. Insurance premium which are obligatory for foreign workers as a replacement to SOCSO contributions
6. Group insurance premium to cover workers in the event of an accident
7. Leave passage
- Leave passage in MY of not more than 3 times in one calendar year, or
- Oversea leave passage of not more than once in any calendar year limited to a maximum amount of RM3,000

8. Value of discount on goods will be exempted up to maximum RM1,000 and the goods can be provided fully or partially discounted by applying the sale price

9. Discounted price for consumable business products of the employer and discounted price for services provided by the employer
- Discount price for consumable business product of the employer (RM1000 max)
- Discount price for services provided by the employer

10. Modern medicine, traditional medicine and maternity

Disclaimer :

We make no representations or warranty (expressed or implied) about the accuracy, suitability, reliability or completeness of the information for any purpose.

We disclaim all responsibility, for the consequences of anyone acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

Recipients should not act upon it without seeking specific professional advice tailored to your circumstances, requirements or needs.

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