Introduction
- 1. Add Compensation for Loss of Employment column checkbox in Bonus.
- 2. Tick then trigger the exemption for compensation.
Rules:
- 1. Compensation exempted from income tax is RM10,000 x no of years of service.
- 2. Determine the number of completed year of service. For example, employee has serverd for 5 completed year of service
- 1/5/2004 - 30/4/2005 (year 1)
- 1/5/2005 - 30/4/2006 (year 2)
- 1/5/2006 - 30/4/2007 (year 3)
- 1/5/2007 - 30/4/2008 (year 4)
- 1/5/2008 - 30/4/2009 (year 5)
- 1/5/2009 - 25/3/2010 (n/a, less than one completed year of service)
- 3. Tax exemption on compensation
- RM10,000 x 5 years of service = RM50,000
Workings:
- Compensation paid (key in Pending Compensation) = RM75,0000
- Less: Amount of exemption RM50,000.00
- Balance of compensation subject to MTD RM25,000.00
- Balance of compensation of RM25,000.00 after deducting the qualifying exemption will be subject to MTD and the MTD shall be calculated using Additional Remuneration PCB (A) Formula.