Income Tax Woes

It's that time of the year again dreaded by everyone in the working world. Yep, it's income tax time. For Malaysians, we have another 5 days left to submit our Income Tax BE Form (declaration of income for the tax assessment year of 2006) before the April 30th deadline. We have to submit the form to the Lembaga Hasil Dalam Negeri or Inland Revenue Board (IRB) which the equivalent of the IRS in the States.

To be honest, I'm still struggling to do mine, hehehe. Not that it's difficult but because I kept delaying and delaying until the last possible moment. Well, I'm like that - last minute kind of guy. And when I say it's not difficult, I'm not kidding. You don't need to know rocket science to calculate your taxes here in Malaysia because the process has been simplified by the IRB. Unlike in the States where you have to keep all your receipts for expenses incurred during the previous assessment year and also requiring a tax agent or consultant to actually do it for you. Here in Malaysia, individuals who "makan gaji" or earn their salaries through employment, do their taxes on their own. Only businessmen engage the services of a tax agent.

I'm proud to say that I've always submitted my tax returns on time and paid all the required amount. It also helps that I have "Potongan Cukai Berjadual" or "Scheduled Tax Deduction" from my monthly salary which is automatically credited to the IRB by my employer. The good thing about this is that you don't really feel the pinch of paying your annual income tax because most of the time, the amount which has been deducted during the previous year would already cover the required tax amount. You only need to pay the difference.

But for the past two years, I've been feeling the pinch actually, eversince joining my current employer. Eventhough I earn more here, I have to pay more in taxes. That's the bitter irony of it all. The higher your pay, the higher your taxes. Now is that cruel of what?

I finally got down to doing my taxes today. And I felt sick to my stomach when I found out how much I have to pay this time around. Damn. Even the scheduled tax deduction couldn't cover the amount. Hmm, maybe some creative accounting will do the trick....