Investing in KLSE and Income Tax questions.

[in]

Hi. We are thinking of investing in some stocks in the KLSE. I have a couple of questions to ask regarding dividend income and income tax.

1. I only work part-time and my annual income is not enough to be taxable. My husbands annual income is taxable. Can you advise under whose name should the stocks be purchased under. (Should there be dividend income.)

2. When submitting our BE form, should I file under separate assessment or combined assessment? As mentioned, my annual income is not enough to be taxable.

Thank you.

[rakyat]

For 1st question, use ur husband's name as the dividend is already taxed at corporate rate of 26%. If your husband is annual income does not exceed the maximum range, you are entitled to some refund on the dividend tax.

2nd question is abit tricky, you need to work out 2 forms to see if the additional deductions are worthwhile. I suspect that it is better to use separate assesments as the additional deduction from joint assesment is not much (additional RM3k to RM5k? Unless your annual income is less then that then maybe worthwhile).

[in]

Thanks for your response!
Just another quick question. (sorry, I'm clueless about all this.) Lets say if i were to buy the stocks under my name..... and we submit income tax under separate assessement, will I get a refund from the IRD because of the dividend tax?

[CCY]

If not mistaken there is a column in the tax form for dividend income and there is a column where an amount of income tax is already paid at source....eg dividend.

Later down just do the necessary maths as instructed , you would have every sen paid being minus and taken care of if your final taxable amount is more than your tax deducted from the dividend.

But.....If your total taxable income is less than the amount deducted from dividend...then.. susah lor ... to claim for refund from IRB on the tax deducted at source on you dividend. Have to fill in another form and attach with your submission...

[Naka]

If you get some dividents from share, a 25% or 28% is automatically deducted at source.

How do you avoid that or what do you have to do to prevent this?

[currymee]

If you get some dividents from share, a 25% or 28% is automatically deducted at source.

How do you avoid that or what do you have to do to prevent this?

You cannot avoid the tax deduction at source BUT only claim back during your annual tax submission. So, if you forget or lose the voucher, UNTUNGlah the Govt ....

[Naka]

You cannot avoid the tax deduction at source BUT only claim back during your annual tax submission. So, if you forget or lose the voucher, UNTUNGlah the Govt ....

OIC, what if you dun have to pay tax anymore?

[currymee]

OIC, what if you dun have to pay tax anymore?

Fren, you have to keep filing in your tax submission until you checked out .... if you want the money back.

[Naka]

Fren, you have to keep filing in your tax submission until you checked out .... if you want the money back.

[in]

Thanks for the info everyone! Very very helpful indeed.