EXERCISE 2EMPLOYMENT INCOME

QUESTION

Fairuz is an engineer of a private consulting company in Penang. To enhance his efficiency in carrying out duties, he was sent for a short course in Japan for the first three months in the year 2014. While attending the course, he was given a monthly extra allowance for living abroad of RM1,500 in addition to the basic salary of RM5,600. Besides, there are other incomes enjoyed by Fairuz for the year 2014 as follows:

Entertainment allowance RM7,200Bonus RM8,400

The company, D’Angkasa Consulting Sdn Bhd paid for the following expenses:

1. Fee for Water Treatment short course of RM7,400.2. Return airfare to Japan costing RM4,600 for the short course. After attending the course,

he was given a leave passage to China costing RM3,500.3. Leave passage to Kuala Lumpur and Johor Bahru costing RM1,800 and RM1,500

respectively including 30 percent for foods and accommodation.

Throughout the year, the company provided Fairuz with a car and fuel of which the car had a market value of RM56,000 in the year 2014 when it was first provided to him. The car was bought by the company in the year 2008 with a cost of RM112,000. Furthermore, the company employed a driver and a servant at a salary of RM500 per month for each of them. He has been provided a fully furnished house by the company since he joined the company in January 2013. The annual defined value of the house is RM48,000 including the value of furnishings of RM18,000.

REQUIRED:

Compute the statutory employment income of Fairuz for the year of assessment 2014.