Steven has been working for many years as a general manager with Finder Sdn. Bhd.(FSB), a private

company which is based in Petaling Jaya. He resigned from his company at the end of September 2018.

Steven's benefits in cash and in kind from FSB for the year 2018 were as follows:

Salary of RM15,000 per month.

An overseas allowance of RM5,000 for his 2 weeks' work duty in Bangkok.

A total of three months' bonus for year 2017 totaling RM45,000 was received in February 2018.

For the first few months of 2018, he hired a driver and claimed a reimbursement of RM6,000

from FSB. With effective from 1 June 2018, a driver was provided to him.

His children were provided with care benefits totaling RM2,000.

A new Toyota car costing RM190,000 was provided to him on 1 January 2018. He was given the

approval by FSB to purchase the car at a discounted price of 20% below the current market value

of RM150,000 on the day of his resignation.

A fully furnished bungalow was provided to him from 1 March 2018. FSB paid a monthly rental

of RM3,000 per month for the bungalow and RM600 per month for the house furnishings.

His wife, Maria has the following businesses for the year ended 31 December 2018:

Direct selling business:

The current year adjusted income from business is RM245,000. The current year capital allowances and

unabsorbed business loss brought forward are RM26,000 and RM12,000 respectively.

Bakery business

This business was not in operation in 2018. The unabsorbed business loss brought forward from the year

of assessment 2017 is RM27,000.

Other information:

(i) Steven and Maria have a pair of twin girls aged 10 years old and a child of 20 years old, who is

studying at University of Otago, New Zealand.

(ii) Steven contributed RM24,000 to the EPF while his employer contributed RM36,000 to the EPF

for him.

8

BBFT2054 TAXATION

This question paper consists of 5 questions on 10 printed pages.

(iii) Maria incurred hospital medical expenses of RM6,000 for her mother-in-law.

(iv) Maria purchased a new laptop and a sports equipment costing RM1,700 and RM900 respectively.

(v) Maria contributed RM7,000 to Skim Simpanan Pendidikan Nasional for her children.

Question 2 (Continued)

Required:

(a) Compute the chargeable income for Steven and Maria for the year of assessment 2018 on a

separate assessment basis.

(All items stated in the question are to be included in the computation. Where the item is not

taxable or deductible, indicate 'nil' in the computation)

(16 marks)

(b) Explain ANY THREE (3) differences in tax treatment between Steven's employment income

and Maria's business income. (3 marks)

(c) Explain the tax treatment of Steven's overseas allowance for his work duty in Bangkok. (2

marks)

(d) Explain the tax implications of the monthly salary of RM8,000 on Steven and his employer.

(4 marks)