Top 10 Information on Tax Credits for 2023: The Complete Guide to Electronic Filing

Hello Tax Warriors!

As we prepare for the new tax season, it's time to arm ourselves with the knowledge we need to navigate those pesky forms and deductions.

So grab your favorite beverage and settle in as I break down everything you need to know about the 2023 tax credit.

From interpreting tax rates to uncovering hidden deductions, we've got you covered.

Let's dive in!

1. Know Your Tax Fees

Before we get into the set of deductions, let's cover the basics: tax fees.

Understanding which tax bracket, you fall into can change the way you plan your finances.

Check out the chart below to see where you stand:

Tax Rate Changes for 2023 (Compared to 2022)

Here's a breakdown of the tax rates for different income ranges in 2022 and 2023:

• Up to RM 5,000: 0% tax rate (No Change)

• RM 5,001 to RM 20,000: 1% tax rate (No Change)

• RM 20,001 to RM 35,000: 3% tax rate (No Change)

• RM 35,001 to RM 50,000: 8% tax rate in 2022, decreased to 6% in 2023 (Decreased by 2%)

• RM 50,001 to RM 70,000: 13% tax rate in 2022, decreased to 11% in 2023 (Decreased by 2%)

• RM 70,001 to RM 100,000: 21% tax rate in 2022, decreased to 19% in 2023 (Decreased by 2%)

• RM 100,001 to RM 250,000: 24% tax rate in 2022, increased to 25% in 2023 (Increased by 1%)

• RM 250,001 to RM 400,000: 24.5% tax rate in 2022, increased to 25% in 2023 (Increased by 0.5%)

• RM 400,001 to RM 600,000: 25% tax rate in 2022, increased to 26% in 2023 (Increased by 1%)

• RM 600,001 to RM 1,000,000: 26% tax rate in 2022, increased to 28% in 2023 (Increased by 2%)

• RM 1,000,001 to RM 2,000,000: 28% tax rate (No Change)

• Over RM 2,000,000: 30% tax rate (No Change)

Highlights:

• Tax rates decreased for income earners between RM 35,001 and RM 100,000.

• Tax rates increased for income earners between RM 100,001 and RM 600,000.

• No change in tax rates for those earning below RM 35,000, above RM 1,000,000, and over RM 2,000,000.

Now that you know your tax rate, let's move on to the next step.

2. Decoding Taxable Income

Taxable income can be a bit of a headache, but don't worry, I'm here to figure it out for you.

Simply put, taxable income is your total annual income after deducting all tax exemptions and allowances.

Need an example? Meet Aaron:

Taxable income:

RM65,200 - RM1,600 - (RM9,000 + RM6,000 + RM1,800 + RM950) = RM45,850

Tax payable:

RM45,850 x 8% (tax rate) = RM3,668

Got it? Excellent.

Let's keep the momentum going.

3. Education matters - but only if it's vocational

Planning to claim a tax credit for your education?

Hold your horses - there's a catch. According to the authority of the Tax Board (LHDN), only certain fields of study can receive tax incentives.

Say goodbye to English literature and welcome to law, accounting and all things professional.

4. Mothers, rejoice!

Watch out, mothers of the world: your hard work is paying off—literally.

Thanks to the generous tax exemption for breastfeeding equipment, you can say goodbye to those high pump prices.

Remember, keep it below RM1000 and you'll be golden.

5. Kids Game - Day Edition

Sending your child to daycare?

You are in luck.

You get a decent tax credit for each child aged 6 and under.

Consider it a small reward for keeping your sanity.

6. Previous Files: Alimony Payments

Divorces, listen up - these alimony payments are silver.

You can claim a tax credit of up to RM4,000, but be sure to keep the signed contracts handy.

No paper, no help, it's that simple.

7. Attention sports enthusiasts

Do you like going to the gym?

You may be eligible for a sweet tax break, but not those trendy workout threads.

Use sports equipment like dumbbells and badminton rackets and you'll be free.

8. Zakat, taxes and everything in between

Muslim taxpayers, rejoice - your zakat payments can get you a tax break.

Remember to pay by January 1st to claim your savings.

9. Health is wealth

Are you struggling with a health problem?

You may be eligible for tax evasion.

From cancer to diabetes, certain illnesses can earn you much-needed financial relief.

Remember to keep your doctors receipts.

10. Advantage of an electric car

Do you drive an electric car?

You are in luck.

You get a significant discount on the installation costs of the electric car charger, which makes living eco-friendly even more affordable.

Huh! It's been a lot, but I hope you feel a little more confident about doing your taxes this year.

Remember that knowledge is power - especially when it comes to your finances.

So go forth with your newfound wisdom and conquer tax season like a pro. Happy archiving! 🚀.

"Get ready to ace your taxes with our ultimate guide to 2023's assessment tax relief!

From decoding tax rates to uncovering hidden deductions, we've got you covered. Learn how to maximize your savings, whether you're a new parent, a fitness fanatic, or driving an electric car. Don't miss out on valuable tax relief – dive into our article now and conquer tax season like a pro!"