Thursday, March 26, 2009

Malaysia income tax e-filing, zakat

I found this info in the internet. I didn't know this until now! Wondering now if it's true... Anyone has any idea about this?

"In Malaysia, there is an income tax. Money paid to “zakat” or the obligatory alm Muslims must give to the poor reduces the tax to be paid while money paid to other religions under similar circumstances is not given similar treatment:

it reduces tax only if the particular beneficiary has obtained such status from the government, which is difficult in practice.even then, if money is donated to a non-Muslim religion it is only deducted from the income on which the amount of tax is based, while zakat is deducted from the amount of tax itself.

For example, suppose a person earning RM 50,000 owes a tax of RM 3,000, and donates RM 1,000 to his religion. If he were non-Muslim he would then adjust his assessed income to RM 49,000. If he were Muslim then he would only have to pay RM 2,000 as the RM 1,000 would be deducted from the amount owed.

Did you know that? Wow, that way I can avoid paying all tax, by giving to charities! I always felt that this country is run by taxes paid by non-muslims. This shows its true."

Source: http://blog.limkitsiang.com/2007/04/08/security-flaw-suspend-income-tax-e-filing-system/