Tax time is coming.
When I worked desk jobs, I never really cared about taxes. I only had to copy the numbers from Borang AE into the tax form, write a check for a puny amount, mail it out and that’s it.
Now things are not so simple. I own a few partnership companies and private limited (Sdn. Bhd.) companies. First of all, as owner, I have to make sure the books are in order for the auditors. I don’t have a staff to do that, I have to dig the files myself.
Then, there are more than one kind of taxes. For the partnership companies, I have to pay personal income tax, while for the Sdn. Bhd. companies, I have to pay corporate taxes. On top of that, I earned salary from my company and for some other jobs I did with other companies. That means complicated tax codes to decipher and coming up with even more complicated schemes to reduce the amount I have to pay.
We do not have an accountant in the company; I have to do the accounts myself. I never studied finance or accounting in college, so in this area I am one of the Dummies for whom “XXX for Dummies” books are written. My personal favorite is “Accounting and Finance for Non-Specialists” by Atrill and MacLaney. I learnt all my accounting from this book, and also from Wikipedia (of course).
I met our auditor yesterday, he estimated that I have to pay a total of RM 40K in taxes. Look, I am young and poor. I am not a rich person. RM 40K is TOO MUCH to give back to the government.
It’s like working hard for ten months in a year, and then working another two months for free while the government take all the money. We all work very hard here; the profits we made are not the effort of 100 people, it’s the job of a few people in the company who busted their asses (thanks Iznan, Fazdlee and Luqman).
Malaysia has a progressive tax code: people earning more will pay a higher percentage of taxes. That’s why business owners and rich people are more passionate about the tax issue. And that’s why I am a libertarian when it comes to the economy. I believe in small government and lower taxes.
I will write more about libertarianism, after I’m done with the paperwork that I have to finish for the audit.
Anybody with suggestions how to reduce taxes?