26 Ways to Slash TAXES - Part 2

6) Make charitable contributions
A gift of money to an approved charitable organisation entitles you to a tax deduction for the amount given.

From 2008 onward , this amount cannot exceed 7% of your aggregate income.

However Charitable donations that were made in 2007 are not subject to this limit.

Tax deduction :
Up to 7% of your aggregate taxable income can be reduced with this deduction.

For Mr A : With his taxable income of RM 90000 , Mr A can make a donation of RM 6300 .This deduction results in a saving of RM 1512 ( RM 6300@24%)


7) Take Up postgraduate studies
A relief of RM 5000 per year for any course of study at the Master’s or doctorate level , the government announced in 2007 Budget the widening of the scope to all postgraduate studies.

The course does not have to be done full time , but “ must be in an institution or professional body in Malaysia recognised by the government or approved by Minister of Finance

Tax Deduction :
RM 5000 per individual

For Mr A : As he completes his master’s degree . Mr A can enjoy tax saving RM 1200 from his taxable income ( RM 5000@24%)


8) Read , Read , Read
Starting from YA 2007 , taxpayers can claim a personal tax deduction to RM 1000 for purchase of books, journals , magazines and other publications.

To maximise this generous deduction , consider giving books as gifts.

Tax Deduction : RM 1000 per individual

For Mr A : With book purchases of RM 1000 Mr A saves RM 240 ( RM 1000@24%)


9) Get Sporty
You will get a deduction of RM 300 for each year of assessment for the purchase of sports and exercise equipment for any sports activities defined under the Sport Development Act 1997 “

Tax Deduction : RM 300 per individual

For Mr A : By buying RM 300 worth of sports equipment , Mr A makes a saving of RM 71 ( RM 300@24%)


10) Buy Life Insurance
The maximum tax relief is RM 6000 a year for premiums paid to an insurance company for life Insurance or deferred annuity plans.

This Limit is shared with your contributions to the EPF, other employer schemes and contributions under any written law relating to widows or orphan pensions

Tax deduction : RM 6000 per individual ( shared with your EPF contributions )