Income tax return filing due April 30

Argh!.....it's that dreaded time of the year again....getting the receipts and income statement ready...trying to figure out how to fill in the income tax return form. Although I have been filling it every year, I still find it confusing and challenging because my Bahasa Malaysia is not my forte.

I have been doing e-filling ever since it was made available and it is the source of my worst fear of filling tax returns is when I have to hit the "Submit" button and getting an error message!! In trying to provide a secure transaction with digital certification, the IRB's e-filing has become user unfriendly

OK.Enough said. I just want to remind Malaysians readers that we have only one month to complete our income tax returns. The Inland Revenue Board (IRB) has sent out all income tax return forms for the assessment year of 2008. However, those who used the e-Filing system to submit their BE forms for the assessment year of 2007 will not be sent any forms.
Taxpayers who do not have a source of income from businesses and whose income was less than RM20,000 for the assessment year of 2007 would also not receive their BE forms.


Source: The Star

Free WIFI services in Penang!

This is fantastic news! Now I don't have to buy an overpriced cup of coffee or hang around bars and bistro in order to surf the web using the free hotspots provided by the establishments. Now free WIFI comes directly into your home.....if you happen to live within the free hotspots areas.

Yesterday, Penang launched its free WIFI service with initially 26 hotspots making it the first state to have free public WIFI services . Eventually a total of 750 hotdpots will link the majority of the state to the internet and 350 by this year end.

The launchat a local hotel was attended by Penang's Chief Minister Lim Guan Eng, DCM2 Prof Dr. P.Ramasamy and Penang free WIFI Initiative head, Jeff Ooi. The service is provided by REDtone.

Current free hotspots are areas surrounding KOMTAR, Bukit Jambul, Mayang Mall, Chulia Street, Penang Road and Permatang Pauh.

Source: The Star

7 New Rules of Financial Security

I received a CNNmoney.com link from a friend about the 7 new rules of financial security. The article offers 7 old assumptions that probably would have been good advice in the past but today the same assumptions may not hold true in a global economy especially an economy that is unpredictable and on the down turn. I thought it was a good article and I would like to share it with you....informative and thought provoking

For example, in the past, a home owner could expect his house value to appreciate well over the long run. But now, your home no longer can make you rich.... Click on the link below to read further which the article offers insights into risk, cash, human capital, borrowing, housing, diversification and retirement.

Source: CNNmoney.com

Fuel Rebate To End on April 14

The Malaysian government has extended the claim period for another two weeks for which car owners are able to collect their cash rebates from Pos Malaysia. The claim period was supposed to end by March 31.

Eligible vechiles owners are encouraged to renew their road tax and submit their claims at post offices by the deadline. Car owners are entitled to a RM625 rebate while motor cycles owners get RM150 per vechile. The rebate was the goverment's effort to dampen the effect of the risng fuel cost last year.

Selected post offices are open till late and on weekends to help office hour workers to claim their rebates.

For those who have yet to claim their rebate, do it now before the deadline!

Source: The Star

EPF dividend expected to be at 4.5%

Employees Provident Fund's 2008 dividend is expected to be at 4.5%. However, National Union of Bank Employees secretary-general J. Solomon has lashed out at EPF saying that the dividend given is too low considering EPF is a cash rich body. Malaysian Trade Union Congress executive council member A. Sivanathan is expecting more than 5% dividend and this would be a fair amount.

Read more in details in The Sun

Not a very stimulating stimulus package for me

Just when I thought that at least one of that action items in the RM60B stimulus package might be relevant and beneficial to me who has a running housing loan but unfortunately the Inland Revenue Board (IRB) clarified in the media today that the RM10,000 tax deduction for interest on houing loans will be applicable for new properties bought (Sales & Purchase signed) between March 10 2009 and December 31 2009 and not for all housing loans Sob! Sob! (and you are not supposed to rent the property out too)

So after all, the stimulus package is not so directly stimulating for me after all. I think only two actions plans that is relevent to me is the price control on control food items and the tax deduction on my housing loan interests paid. Maybe the control on toll rise may help but for now I do not need to travel on highway that much.

The impact on control food items is minimal to me. I take my food and drinks with less sugar, less oil and less carb anyway (I am trying to stay healthy). The tax deduction on housing loans can really help stretch my ringgit a bit further but with the clarification from IRB that the deduction only applies for new purchases....so now I need to cross off stimulus action#2 as something that can benefit me. Let's not talk about retrenchment benefits for now. This is a benefit which I do not want!

I think that tax deduction should apply for all housing loans. I am paying more than a thousand ringgit per month on housing loan interest alone. The more money I have in my pocket, I may use it to buy some other things I might need thus in a way stimulating the economy, right? The restriction that the benefits only applies to new purchases will only help the developers who at anytome is more cash rich than I am.

So in summary the RM10,000 tax deduction benefits applies to.....
- property purchases berweem March 10 2009 to December 31 2010
- only one property per Malaysian citizen and resident
- Malaysian citizen and must reside in Malaysia only
- Property must not be rented out
- The tax deduction is given for three consecutive years from the first year the housing loan interest is paid and is effective from the year of assessment 2009

Sigh......

Source: The Star

RM67B stimulus package - What's in it for us?

There you have it. Our Deputy Prime Minister Datuk Seri Najib Tun Razak has just tabled a RM60B "mini budget". Well, this package is not mini by itself (accounting to more than 9% of Malaysia's GDP and almost a third of 2009 budget). It's 8 times bigger than the first RM7B stimulus package aimed at helping Malaysia to weather the world economic crisis, the worst economic contraction since the 1930's.

With addition of the stimulus pacakge, Malaysia's GDP gowth is expected to be between -1% to 1%. (doesn't sound good at all, even at best case scenario). So what does all this means to people like us? Well, if I understand corrently (and I highlight the important bits)............

• No increase in necessities food prices like sugar, flour and bread in two years
• No increase in toll in two years
• Tax relief of up to RM10,000 on interest paid on housing loan for three years
• Repair and mantainence of public ammenities to make our living conditoon better and improve the tourist spots
• Government will issue saving bonds to all citizens aged 21 and above, with a minimum investment of RM1,000 and a maximum of RM50,000
• Job training and placement for the unemployed and setup of more job centers. Government will also hire more people to work in various government positions
• To reduce retrenched worker's burden and their increase disposable incomes, the Government proposes that the existing tax exemption of RM6,000 given on retrenchment benefits be increased to RM10,000 for each completed year of service
• Bosses who hire retrenched worker will get double tax benefits up tp RM10,000 deduction per month
• The Government will undertake to finance tuition fees and research grants of up to RM20,000 for every student pursuing a PhD locally and RM10,000 for Masters to encourage self development in higher studies
• Reduced dependence on foreign workers in certain sectors
• A discount of RM5,000 given to car owners, who trade in their cars, must beat least 10 years old, for buying new Proton or Perodua cars. The Government will continue to finance part of the discount
• And added funding for rural development to provide better electricity and water facilities

Read the full speech of DPM DS Najib Tun Razak and what's more in the "mini" budget, click HERE (The Star)

Now, we as good citizens must ensure that 100% of the money is put into good use and not fuel corruption.....

Are You Paying 10,000% Interest Rate on Your Credit Card?

Having a credit card is convenient. You nenver know when you need more money in an instant. To save you from that embarassing moment when you need to pay that bill and only then to fid out that your wallet is as dry as the dessert in terms of that liquid cash

But did you know that having that convenience comes at a cost? More than what you might think. Did you not read that fine print when you applied for a credit card?

The star's managing editor, P.Gunasegaram share his personal experience of having an overdue credit card payment and its cost. He wrote "Let's say you have an outstanding balance on your credit card of say RM100. And you just forgot to pay your bill on time. What do you think your charge will be on an annual basis? Would you believe 10,000%?"

Want to know more? Read all about it HERE

Source: The Star (Business)

Fish Prices Soar 20-30% Due to Shortage of Supply

A shortage of fish has caused prices to soar – all because of a controversial fish container ruling. See my previous blog.

Checks at several wet markets here and in Kuala Lumpur showed that prices of fish had shot up by up to 30%.

Fish distributors and wholesalers increased their cost when The Fisheries Development Authority of Malaysia requires the use of insulated fish containers to transport the fishes.

To make matter worst, these containers are supplied by a single supplier. Most porbably the supply of these insulated boxes are not enough and waiting period is long

For full report, click HERE

Source: The Star

EPF Contributions: To Cut or Not To Cut?

Anita Gabriel, a regular columnist of The Star gives a real insight about the truth on our contributions in the Employee Provident Fund.

Did you know that over two thirds of EPF contributors exhaust their retirement funds in less than 3 years of retirement? Scary, huh? What more if contributors cut their monthly contributions by 3 of a percentagepoints in support of the government's recent effort to stimulate the economy.

In recent weeks, there have been suggestions for cuts in employers’ contribution to EPF to alleviate the burden of rising costs faced by businesses amidst waning demand and the general economic slowdown

So having said that, is EPF the best retirement fund scheme? Some analysts say that today's contribution rates are not enough (to sustain us after retirement) and should be increased. Read about what Anita has to say. Click HERE.

For me, I would like as much money in my EPF as I can get. So I filed an application to revert back to 11% contribution (from 8%). I need every single cent of my EPF savings when I retire.

And as Anita mentioned. Malaysia's population is ageing and I think more family is practising one or two child policy. And just like Japan's current ageing population, I don't think any aged parent can really depend on their children for any financial support and that's why whatever and how much you put into EPF is important.

Source: The Star (Business)

Staying Ahead Financially in Tough Times

Many are still struggling to make ends meet despite recent decreases in the price of petrol. As a matter of fact, Malaysia may be heading towards a full time recession if current global financial situation does not make a change for the better now.

Norzuhaira Ruhanie, a writer for The Edge Daily offers a few tips on staying financially strong in a slowing economy.

1. Review Your Financial Goals
The first thing to do is review your financial goals and decide if you can stick with them or revise certain targets to suit your current needs. “You need to know where you are and where you want to get to. Taking the time to set challenging but realistic goals is vital,” says Rajen Devadason, a Securities Commission-licensed financial planner with MAAKL Mutual Bhd.

He also adds that long-term goals may remain unchanged but personal cash levels should be increased. When looking out for investment opportunities, says Rajen, take advantage of any sharp dips in the equity, bond and property markets to buy great assets that generate cash flow by way of dividends, distributions, coupons and rent. However, it is imperative that the buying is done largely out of current cash flow surpluses and not by depleting capital too quickly, he adds

2. Spend Less, Save More & Look at avenues to increase your take-home income
If cash is king, then you need to bring yourself into a stronger position. Reduce spending, work much harder to generate larger incomes and therefore get significantly larger cash surpluses, build large savings buffers and invest slowly and carefully over the long haul, says Rajen

“Ways to reduce spending could include eliminating consumer debt by paying off all credit card balances and deferring any unnecessary lumpy purchases that are not wealth-generating… like a new car if the old one is still functional,” he says.

The goal, says Rajen, should be to “try and get to the point of being able to save and invest 40% to 50% of your net income, apart from EPF, which is forced savings and which should continue at the maximum allowable rate.“The only way to create investment capital is to spend less than you earn and to carefully allocate your savings toward the emergency buffer, normal savings and well-chosen investments.”

Most Malaysians, says Ng, have been controlling their spending due to hikes in the price of many consumer goods. Look at avenues to increase your take-home income, he adds. “See if you can earn extra income doing what you already doing, but in your own time. If you are a tax consultant, for example, you could ask your boss for a commission if you secure clients outside your working hours.”

3. Have your emergency buffer
Have been putting off building an emergency buffer? While it is always important to have one, uncertain times means it is all the more crucial. The fund, says Rajen, should be between three and six months’ expenses for an employee and six to 12 months for a self-employed individual. “If you don’t have the buffer in place, your savings allocation should go into an emergency fund until it reaches the target size, based on your circumstances.”

To ensure maximum safety, the money should “be kept super safe in bank savings accounts, fixed deposit accounts and money market funds that do not have any bond component,” he adds.

Source: The Edge Daily

Malaysia may face full-blown recession

KUALA LUMPUR: There is a 50% chance Malaysia will fall into a “full-blown” recession this year, said Malaysian Institute of Economic Research (MIER) executive director Prof Datuk Mohamed Ariff Abdul Kareem.

“Technical recession is almost certain. The 1.3% (real gross domestic product (GDP) forecast in January) is considered optimistic. In fact, I think the best-case scenario will be 0.5% growth this year.

“We forecast the first half year will have negative growth but hopefully the second half will show some positive figure, which will give us 0.5% growth,” he said, adding that MIER would review again the GDP as a lot of development has taken place since the last forecast. Speaking after a seminar organised by Rahim & Co, Ariff said Malaysia’s economy might remain sluggish for a long time.

“My fear is that we may be stuck there for sometime. Contraction may not be sharp but long,” he said, adding that it could take three years (2012) before the local economy returned to normalcy.

He expected the fiscal deficit to increase to more than 6% of GDP if the second stimulus package was RM30bil, which is about 4% of GDP. Financing the deficit budget was not a problem as there was a lot of liquidity in the local financial market, which funds 93% of the government deficit.
However, he said it was “not about how much you spend, it is how you spend that matters.”
“It is about confidence and confidence depends on transparency. People want to know where the money comes from and where it’s going. Unfortunately, transparency is low in Malaysia.
“A fiscal package may only cushion impact but cannot neutralise it. But without any stimulus package, it will be worse,” he said. Meanwhile, Ariff projected the ringgit would take at least four years to reach 2.8 against the US dollar, a level which he considered equilibrium.

He said the greenback continued to be artificially strong now because central banks worldwide were continuing to fund the US deficit, and thus increasing the demand for the dollar.
In the meantime, the ringgit would remain weak and volatile, but unlikely to cross 3.8 against the dollar, Ariff said.

Source: The Star

A Home Cooked Gourmet Meal for Two for RM6.35?

What meal can you make for RM6.35? The four cooks put their budgeting skills to the test and came out with 4 unique and simple receipes

- Barley Fuchok (pictured)

- Chilli Lime Prawns with Pineapples in a Skewer

- Lazyguy's Mom Crazy Rice and finally

- Chickpea Pancakes with Spicy Tomato Mash

For the receipes and methods, click HERE (source: The Star)

Guess the amount spent and win a trip to London with Air Asia

Take part in the great Bristish tour contest by guessing how much the contest travellers spent on their trip to London. The entry that comes closest to the amount wins! Stand higher chances of winning (Trip to London for two inclusive of hotel courtesy of Air Asia and British Tourism) when you forward the contest on.

I had a try at guessing Nicholas the camera buff expenditure while in London. I think it's about 420 pounds for his 5D/4N trip. I will try to determine the other travellers cost some other days. I will share what I guessed in updates to this blog later.

Let me know (Share with others) what is your guess for any of the traveller if you are having a go at it. Leave your guesses in the comments, thanks!!

What's great and fun about doing this contest is that I get to learn about cool places to visit all for under 500 pounds for a 5D/4N trip with hotel!

Tip: You need to look-up the clues in the travellers itenery and determine how much the travellers spent but it will be less than 500 British pounds

Click HERE to enter the contest

It pays to keep paying

Should houseowners take advantage of the lower base lending rate (BLR) and enjoy more disposal income with lower monthly home loan repayments? Or should they pay the same amount and complete their loan repayments faster?

Financial planners urge homeowners to opt for the second option if their income level has not been affected by economic downturn.

By shortening the tenure of their loan repayment period, they pay significantly less interest in the long run.

Based on the expected reduced BLR of 0.4% which comes into effect next week, a borrower with a RM200,000 home loan over a tenure of 20 years stands to save more than RM19,000 if he continues to pay the same amount.

On the other hand, he will save only close to RM11,000 if he reduces his monthly payment in keeping with the lower BLR (see chart).

Source: The Star