Applicants for 1 Malaysia People’s Aid (BR1M) should not be worried over rumours that the Inland Revenue Board (IRB) will use the information received to chase after the potential taxpayers.

Those families earning total monthly income of less than RM3,000 are no way near to the categories that need to pay tax!

Let’s work out a simple tax computation for a person that earning exactly RM3,000 per month: 

Yearly salary income (RM3k x 12 m) 36,000
Personal relief (9,000)
Wife relief (housewife) (3,000)
Child relief (2 kids) (2,000)
EPF (3,960)
Net taxable income 18,040

Income tax on RM18,040 will be RM416.20.

Since the net taxable income is less than RM35,000, a rebate of RM800 will be given by the Government (RM400 for personal rebate & further RM400 for wife rebate), thus making NO TAX to be paid to IRB!

As such, if a family is earning less than RM3,000 per month, don’t worry on the tax issue. If you are earning more than that, then YOU ARE NOT QUALIFIED to apply for the cash assistance! 🙂