Freedom.. !! And last minute tax move you should consider..

I am finally free from work obligation.. Yeay! At least for a short while.. I just finished my SIRIM audit and I don't have to go back to the office day and night in order to finish. And oh boy oh boy, I'm s glad it's over.. It's not that I don't like audit, it's just that lately it has become all the work that I do. My principle is that yes you do need to do check and balance, however if you overdo it, it will defeat the purpose of doing quality control. You concentrate on it too much you will neglect doing the thing that you're supposed to do; delivery of the product & service.

Ok, on a lighter note let's talk more on personal financing. It's going to be new year soon and you will need to fill in the BE form sooner or later (unless you earn like less than RM2.5k, the tax agent won't even bother to help you). There are some expenditure you can incur this year that can save you money via tax deduction, but the most important thing to note is whether you need to do it or not. As saying goes, a Ringgit saved is a Ringgit earned.

I got my source from the Inland Revenue Board (IRB), but I kinda doubt it is updated to the latest version. And may I add the website is confusing and very hard to understand. However I do believe that when you do e-Filing it will turn out right so no worries over here. Also, I won't list all of it as I will just list my favourites and stuffs I think doable.

1) Pay your alms (zakat): You can get tax rebate of up to 2.5% of your taxable income. Though, the website says that you're free to put in as much as the tax charged on you so yes maybe you can pay all your taxes in forms of Zakat. Please take my advice with a pinch of salt, consult the IRB for further clarification.

2) Computers: Up to RM3000 is eligible for tax relief. The easiest thing to buy would be storage. Buy as much as you can afford, as you will always use storage. You can get a 500MB hard disk for just RM200, and 1TB (terabyte) for just RM400. Yes, all those spaces will be used up pretty quickly for your downloads, hehe I won't specify what kind now. If wanna get external enclosure, please buy the 2.5" that can run on USB only. The 3.5" will need an external power supply which can be a bit messy. The one I'm eyeing on cost RM275 for 320MB.

Next up is memory upgrade. Older one is SDRAM, followed by DDR, DDR2 and DDR3. Just be sure that if you still want to use the old RAM, you buy one with the same memory speed i.e 667MHZ etc. In my laptop is 2x 133MHZ 256MB RAM if i'm not mistaken. Do take note that older memories is more expensive for a simple fact that they don't produce as much of them now that they're obsolete model. Therefore you might get a better deal buying them second hand from say lowyat.net, but you won't be able to claim tax relief as you need receipts for that.

Otherwise you might just want to buy a new laptop/desktop altogether. You can get a good desktop with RM3k budget with decent LCD monitor as well as good graphic card, no kidding. Laptop cost a bit more but you do have a lot of choice for RM3000. A laptop I'm eyeing, Lenovo IdeaPad S10 will just cost me RM1.8k.

3) Books: Buy as much as you can as much as you want to read. There is no such thing as too much reading. RM1000 is a lot of books, so feel free to splurge. I do believe magazine subscription counts so why not pay now, get the magazine monthly at your doorstep, and get further discount for subscribing. I might do Personal Money Magazine subscription next year, hehe..

4) SSPN account (Skim Simpanan Pendidikan Nasional): If you have child(ren) open an account for them. You get RM3000 relief per year for ALL your children. Yes, it is not RM3k for each child, it's RM3k total.

It's a shame that many people doesn't realise this and they still want to try to find unit trust that can give them higher return for their children's education. Let's say you're tax at 28% bracket and SSPN give you 4% dividend return anually. You're now earning 32% return on your RM3000 deposit that year. Good luck finding unit trust that can give you that kind of return. Nuff said, open your account and deposit that RM3k now.

I think that's all my take on tax reduction last minute steps now. Do visit IRB website for more details. Do not fret if you can't get all this done this year. You can always bookmark my blog and visit them again December 2009. Anyway, Happy New Year 2009 everyone!! Cheers!!~~