Cover image via Best Finance Network
It's that time of the year again – time to crunch some numbers and file your tax returns for 2014, that is!
The 2014 assessment year goes according to the calendar year, meaning you will be filing your income tax return forms for 1 January 2014 to 31 December 2014. The due dates for submission are as follow:
1. Employers (Form E) by 31 March 2015.
2. **Residents and non-residents with non-business income (Form BE and M)** by **30 April 2015**.
3. Residents and non-residents with business income (Form B and M) is 30 June 2015.
4. Partnerships (Form P) is 30 June 2015.
First things first, in order to be taxable, you would have to earn about RM30,667 per year after EPF deductions (about RM2,556 per month), inclusive of all benefits, allowances, bonuses, overtime, and commissions
Your payable tax is determined by taking into account your tax rate bracket based on your chargeable or taxable income, which is calculated after tax exemptions and tax reliefs.
Image via iMoney
Image via iMoney
Usually, your employer would have already deducted a certain amount from your salary every month under the Monthly Tax Deduction (MTD) / Potongan Cukai Bulanan (PCB) scheme, which goes towards paying your tax for the year on your behalf.
Image via Business Insider India
By the end of February, your employer should have issued the EA (private sector) or EC (public sector) Form summarising your entire year's gross earnings as well as EPF and relevant tax deductions
Image via rk / actpayroll
However, employers primarily rely on personal data submitted to Human Resources (HR) – such as your annual salary, marital status, and number of children – to estimate how much tax you will be paying.
Because the deductions do not take into account other tax reliefs you are able to claim, they may have been overpaying tax on your behalf. This is why you should be filing your taxes – to claim back your hard-earned money!
**Full list of and claimable [tax reliefs](http://www.hasil.org.my/goindex.php?kump=5&skum=1&posi=3&unit=1&sequ=1) and [tax rebates](http://www.hasil.org.my/goindex.php?kump=5&skum=1&posi=5&unit=1&sequ=1) on the LHDN website.**
What you might not be aware of is that you can actually opt to submit Form TP1 to your employers instead of filing your tax returns on March/April every year.
Form TP1 ensures that your employer takes into account relevant rebates and reliefs such as insurance, book purchases, and medical expenses to adjust your MTD accordingly, thus avoiding them from overpaying tax on your behalf.
Image via The Star Online
The form can be downloaded [here](http://www.hasil.gov.my/pdf/pdfam/Borang_TP1_2015.pdf).
Additionally, a new ruling proposed in Budget 2014 is allowing taxpayers to have MTD as their final tax from 2014 onwards thus skipping the hassle of filing their tax returns, as their income tax would have already equalled the MTD paid to the Inland Revenue Board of Malaysia (IRB).
The catch is that they would have to fulfill the following criteria:
You do not have to include any receipts or supporting documents when submitting Form TP1, but the one problem with submitting the form is that there is no set time for submission… so that could mean more paperwork for your employers
In a nutshell, the main takeaway is that there are now two ways – submitting Form TP1 or claiming reliefs one-shot come tax season – to ensure your taxes are paid in an accurate and timely manner while taking into account relevant reductions.
Image via TopNews.in
