How to optimise your tax filing


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PETALING JAYA: Tax season is here again, and many Malaysians will be scrambling to file their returns on time and making sure they don’t end up paying more than they need to.

Don’t panic – here are some suggestions.

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One important task is to take note of the various relief claims, especially recent ones under Budget 2024, before filing your returns, said tax expert Datuk Koong Lin Loong.

He said new claimable items are often overlooked by the public, such as the 2022 incentive for electric vehicle (EV) owners.

They can claim tax exemption of up to RM2,500 for costs related to EV charging hardware and services, including the purchase, installation, rental and subscription fees of EV charging facilities, he added.

“This was introduced in 2022 and many people forgot to claim it,” said Koong, who is also the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) small and medium enterprise committee chairman.

Other incentives they should take note of are the RM2,500 relief for lifestyle items and the RM2,500 for the purchase of smartphones, computers or tablets.

(The lifestyle relief covers purchases of books, journals, magazines, printed newspapers and other similar publications, Internet subscriptions, gym membership and others).

“Some people either don’t claim or simply claim the maximum RM2,500, without any knowledge of what they are claiming, and without receipts,” he added.

Koong noted that one can be penalised between RM200 and RM20,000, or subject to jail time not exceeding six months, or both, for wrongfully filing returns.

He advised Malaysians to keep their receipts. Since the ink may fade, it might be better to take a picture of the receipt and save it on your computer, or photocopy it and keep it in a file.

“I also always advise people to keep these receipts for seven years, despite the five-year requirement under present laws.”

Another income tax relief that you may qualify for are any medical fees you pay for your parents.

“There are also some claims that can be shared with siblings. So, please study these claims carefully,” said Koong.

He also said Malaysians should submit their claims as early as possible.

“Many people submit close to the end of the period, and this will jam the system. It will be considered a non-submission (if it fails to get through),” he warned.

Tax consultant Christine Koh said among the common errors while filing returns is claiming relief or even maximum relief without the proper supporting documents.

“The Internal Revenue Board (LHDN) does select taxpayers for audits and will request supporting documents for all relief claims,” she said.

She added that unjustified claims can result in additional income tax and an incorrect returns penalty.

“So, do not try your luck to claim maximum relief without proper supporting documents,” said Koh.

Don’t try to cheat the system either – Koh said some people tend to leave out ad hoc non-employment, non-business income such as commission, wages, rentals and interest from non-financial institutions.

Koh said any under-declared income will be detected by the LHDN during tax audits and they will be subjected to additional taxes and penalties.

She noted that Malaysians who have under-declared their income in the previous year can participate in the Special Voluntary Disclosure programme by the LHDN, which waives all penalties, and it will be ongoing until May 31 this year.

Meanwhile, many Malaysians said they will be submitting their income tax returns earlier this year, in hopes of getting their refunds quickly.

Ahmad Tarmizi, 40, said the refund could help with his spending during the fasting month that is expected to begin on March 12.

“It will also help with the Hari Raya Aidilfitri celebration next month, when I will have to buy new clothes for my kids,” said the teacher.

Financial consultant Goh Siew Loong, 32, also said he will be filing his returns early as he could use any refund to clear his credit card debt.

“Credit card interest rates can be very high after accumulating it over the months and it is best to clear them as soon as possible,” he added.

Beginning yesterday, individual and non-individual taxpayers can submit their tax return forms for the year of assessment 2023 through LHDN’s e-Filing system.

LHDN advised taxpayers to use the e-Filing service through the MyTax portal at https://mytax.hasil.gov.my or through the HASiL official portal at https://www.hasil.gov.my.

It also said registered taxpayers accessing MyTax for the first time should activate their individual digital certificates by generating it through the MyTax portal.

More information on the e-Filing programme for Year of Assessment 2024 can be found here: https://www.hasil.gov.my/media/fw2jk2fd/rf-filing-programme-for-the-year-2024.pdf

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