BDCM-B-Week12: Income Tax Rate for Individual (Updated From Budget 2020)

Non-resident individuals – Flat rate @ 2019 : 28%, Flat rate @ 2020 : 30%

Resident individuals – Scale rate ranging from 0% to 30%

Chargeable Income	Calculations		YA 2019		YA 2020
Per annum	RM		Rate	Tax Payable RM	Rate	Tax Payable RM
			%		%
0 – 5,000	On the first	2,500		0		0
	On the next	2,500	0	0	0	0
5,001 – 20,000	On the first	5,000		0		0
	On the next	15,000	1	150	1	150
20,001 – 35,000	On the first	20,000		150		150
	On the next	15,000	3	450	3	450
35,001 – 50,000	On the first	35,000		600		600
	On the next	15,000	8	1,200	8	1,200
50,001 – 70,000	On the first	50,000		1,800		1,800
	On the next	20,000	14	2,800	14	2,800
70,001 – 100,000	On the first	70,000		4,600		4,600
	On the next	30,000	21	6,300	21	6,300
100,001 – 250,000	On the first	100,000		10,900		10,900
	On the next	150,000	24	36,000	24	36,000
250,001 – 400,000	On the first	250,000		46,900		46,900
	On the next	150,000	25	36,750	25	36,750
400,001 – 600,000	On the first	400,000		83,650		83,650
	On the next	200,000	25	50,000	25	50,000
600,001 – 1,000,000	On the first	600,000		133,650		133,650
	On the next	400,000	26	104,000	26	104,000
1,000,001 – 2,000,000	On the first	1,000,000		237,650		237,650
	On the next	2,000,000	28	280,000	28	280,000
Exceeding 2,000,000	On the first	2,000,000		517,650		517,650
	On the next	..........	28	..........	30	..........

*Chargeable Income is derived from all income after deducts tax relief (sharing @ week 11).

*A Tax Rebate RM 400 automatic granted to an Individual’s chargeable income does not exceed RM35,000 per annum.

Budget 2020 Tax Rate Changes :

1) Tax rates for non-resident individuals have been increased from 28% to 30%.

2) Tax rates for resident individuals with chargeable income of more than RM2 million have been increased from 28% to 30%.

3) In a past few years, tax rate for individual with a trend of increasing. Resulting, people tend to form a Company to enjoy better tax rate and tax incentives.

4) So how much a resident individual earnings per annum will subject to tax?

	Chargeable Income < 35k		Tax Payable
On the first	RM20,000	(refer table)	RM150.00
On the next	RM8,334	3% rate	RM250.02
	RM28,334		RM400.02
		Tax Rebate	-RM400.00
		Final Tax	RM0.02

Don’t forget even 1 cent you also need to pay to government!