Mr. Hairi retired in October 2019, when his age was 56. Upon his retirement, he received a
Question:
Mr. Hairi retired in October 2019, when his age was 56. Upon his retirement, he received a gratuity of RM150,000. In 2020, his wife, Mrs. Anita received RM60,000 from Employee Provident Fund (EPF) i - Sinar, an initiative introduced by EPF, which allows contributors to withdraw their savings EPF in order to aid in cash flow during the difficult economic times posed by the COVID-19 crisis. The couple used all the money received of RM210,000 to acquire a piece of agricultural land near Sepang, Selangor. The land costing of RM340,000. The balance of the acquisition cost was financed through loan application from Maybank.
The land was developed into an orchard, with local fruits including jackfruit, durian, rambutan and mango. In June 2021, Mr. Hairi and his wife migrated to Australia to be with their son and daughter in law. Before they left Malaysia, the couple sold the orchard for RM590,000. The sale was made through a real estate agent and they made for a gain of RM210,000. Mr. Hairi and his wife did not have any other land. This is the first time the couple disposed of a real property.
Required:
Advise Mr. Hairi and his wife, with reasons, whether the profit arising from the sale of land is assessable to income tax.
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts