Saturday, October 9, 2010

How to save RM600 or more without much effort?

If your boss has just decided to give you increment of RM500.00 - don't accept it as it is.

Ask to convert it to EPF contribution. Under Income Tax Act 1967, a contribution to EPF up to 19% is a tax deductible expenses for a company, therefore, make use of the 7% (19% - 12% normal contribution rate).

If you have RM500 per month x 12 months = RM6,000 converted into EPF - you reap the following benefits:-

  1. Learn to spend less when you earn more;
  2. Saving your tax expense by easily RM6,000 x 12% or more depends on your tax bracket.
Win-win for you and your boss. He/she give you something extra without a cost.