Have you ever noticed Part F on your Form EA, which mentions "TOTAL TAX EXEMPT ALLOWANCES / PERQUISITES / GIFTS / BENEFITS"? Yes, certain allowances, perquisites, gifts, and benefits are exempted from your personal tax. Verify that your company has correctly accounted for these tax exemptions by referring to the following list:
1. Petrol allowance, travelling allowance or toll payment or any of its combination for official duties -
Maximum exemption limit RM6,000 per year
Please note that the exempted amount must be kept for a period of seven (7) years for audit purpose.
2. Child care allowance for children up to 12 years of age -
Maximum exemption limit RM2,400 per year
3. Gift of fixed line telephone, mobile phone, pager or Personal Digital Assistant (PDA) including the cost of registration and installation registered in the name of the employee and the employer -
Limited to only 1 unit for each category of assets
4. Monthly bills for fixed line telephone, mobile phone, pager, PDA or subscription of broadband including the cost of registration and installation registered in the name of the employee and the employer -
Limited to only 1 line for each category of assets
5. Perquisite (whether in money or otherwise) provided to the employee pursuant to his employment -
Maximum exemption limit RM2,000 per year
(i) Past achievement award;
(ii) Service excellence award, innovative award or productivity award; or
(iii) Long service award (provided that the employee has exercised an employment for more than 10 years with the same employer)
6. Parking rate and parking allowance -
Restricted to the actual amount expended
7. Meal allowance received on a regular basis and given at the same rate to all employees -
Restricted to the actual amount expended
Please note that the meal allowance provided for purposes such as overtime or outstation / overseas trips and other similar purposes in exercising an employment are only exempted if given based on the rate fixed in the internal circular or written instruction of the employer.
8. Subsidised interest for housing, education or car loan -
Fully exempted from tax if the total amount of loan taken in aggregate does not exceed RM300,000
If the total amount of loan exceeds RM300,000, the amount of subsidized interest to be exempted from tax is limited in accordance with the following formula:
A x B / C
- A = is the difference between the amount of interest to be borne by the employee and the amount of interest payable by the employee in the basis period for a year of assessment
- B = is the aggregate of the balance of the principal amount of housing, education or car loan taken by the employee in the basis period for a year of assessment or RM300,000 whichever is lower
- C = is the total aggregate of the principal amount of housing, education or car loan taken by the employee
Singapore