Assignment
1. Section 5 of the Income Tax Act 1967 describes the ascertainment of chargeable income.
Describe the steps that are used to ascertain the chargeable income of a taxpayer.
2. Identify and briefly explain any FOUR (4) expenses which are disallowable Section 39 of the Income Tax Act 1967.
3. A payer, who pays interest to a non-resident, is required to withhold 15% of the gross interest and remit the amount withheld to Inland Revenue Board Malaysia within one month from the date of payment or crediting the amount to the non- resident.
Explain under the Income Tax Act 1967 instances whereby interest income is deemed to be derived from a Malaysian source.
4. Poopee Sdn Bhd is a company producing wood products and has a Malaysian brand name ‘Solid' which has been duly registered with the relevant authorities. Poopee 's issued share capital is RM2,400,000 and all of its shares are owned by Malaysian residents.
The following information relates to its year ended 31 December 2017:
|
|
RM'000
|
RM'000
|
|
Gross sales
|
|
|
|
Local market
|
19,000
|
|
|
Export market (Note 1)
|
800
|
19,800
|
|
Cost of sales
|
|
|
|
Depreciation
|
1,000
|
|
|
Import duties
|
10
|
|
|
Freight charges
|
29
|
|
|
Insurance premiums on exports of cargo (paid to a locally
incorporated insurance company)
|
2
|
|
|
Other deductible expenses
|
10,859
|
(11,900)
|
|
Other income
|
|
|
|
Dividend income from a subsidiary in Langkawi, Malaysia
|
35
|
|
|
Sale of sundry scrap inventory (stock)
|
1,000
|
|
|
Foreign exchange gains from trade receivables (unrealised)
|
88
|
1,123
|
|
General and administration expenses
|
|
|
|
Audit fees
|
50
|
|
|
Staff remuneration (Note 2)
|
2,400
|
|
|
Cash donations to Persatuan Bomoh, an approved institution
|
103
|
|
|
Staff entertainment expenses
|
18
|
|
|
Leave passages
|
6
|
(2,577)
|
|
Selling and distribution expenses
|
|
|
|
Cash contribution to sponsor a local artist's activity (approved
contribution)
|
505
|
|
|
Irrecoverable debt written off on a car loan to an employee
|
39
|
|
|
Advertisement and promotion expenses to promote the
Malaysian brand 'Solid' in Berita Harian
|
|
|
|
|
9
|
(553)
|
|
Finance charges
|
|
|
|
Interest expenses
|
|
(8)
|
|
|
|
|
|
Net Income
|
|
5,885
|
Notes:
- The export sale was made from Poopee 's factory in Shah Alam, Malaysia to a distributor in Brunei. The distributor had not settled the amount of RM800,000 as at 31 December 2015. The total exports for the current year are expected to be not more than 5% of total sales.
- The staff remuneration comprises salaries of RM2,000,000 and the related employees' provident fund (EPF) contributions of RM400,000.
- The capital allowances claimable for the year are RM1,230,000.
- The chargable income for year of assessment 2016 is RM13,930.
Required:
(a) Prepare the tax computation of Poopee Sdn Bhd for the year of assessment 2017.
(b) Test of Skills at Work: Transfer the information into Sections A to C (Pages 1 to 3) of the Tax Returns Form. Answer in Bahasa Malaysia. You may invent additional information.
Scan in your handwritten answer to your answer document made on Microsoft Word.
5. FaCai Sdn Bhd, a manufacturing company, incurred capital expenditure on the following assets in the year ended 30 September 2011:
|
|
RM
|
RM
|
|
New factory Construction
|
235,000
|
|
|
Land cost
|
90,000
|
|
|
Design and plan fees for building
|
40,000
|
|
|
Legal fees & stamp duty (for purchase of land) Total cost of new factory
|
2,000
|
367,000
|
|
Production machinery (non-heavy machinery)
|
|
195,000
|
|
Office equipment
|
|
18,000
|
|
New computer system
|
|
85,000
|
|
New motor car
|
|
125,000
|
Three assets had been acquired in previous years by the company. Two of these assets were disposed of during the year ended 30 September 2011. The relevant details of the three assets are as follows:
Cost Residual expenditure Disposal price RM RM RM
Motor car (acquired second hand) 75,000 10,000 18,000
Office equipment 25,000 7,500 2,400
Lorry 150,000 60,000 Still in use
Required:
Compute the capital allowances, balancing allowance(s) and/or balancing charge(s) for FaCai Sdn Bhd for the year of assessment 2011.
Attachment:- TMA.rar