Knowledge of business income taxpayers on tax relief and business deduction

A study in kuantan, pahang

Marziana Mohamad, Norkhazimah Ahmad, Mohmad Sakarnor Deris

Research output: Contribution to journalArticle

Abstract

The new tax assessment system is known as Self Assessment System (SAS), whereby the individual taxpayers have to compute their chargeable income and tax return on their own before remitting the payment to Inland Revenue Board (IRB). However, it is anticipated that this system could increase the probability of non compliance due to the lack of understanding and knowledge on how to compute the chargeable income. In this paper, we are interested to test basic tax knowledge of the taxpayers as consumers on their rights and responsibilities on tax relief and business deduction. Beside that, this study also examines whether there is a significant difference in terms of taxpayers knowledge in reference to their demographic characters such as age, gender, race and level of education. The research was conducted by distributing questionnaires to business income taxpayers (sole proprietorship) in Kuantan on their basic knowledge on tax computation. The result shows that the level of tax knowledge on personal tax relief and business deduction is still very low among the individual taxpayers. In addition, only the age, race and level of education of the taxpayers have significant difference in terms of knowledge on tax relief and business deduction.

Original languageEnglish
Pages (from-to)123-135
Number of pages13
JournalMalaysian Journal of Consumer and Family Economics
Volume12
Issue number1
Publication statusPublished - 2009

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Tax relief
Income
Tax
Deduction
Education
Questionnaire
Personal taxes
Payment
Revenue
Self-assessment
Noncompliance
Demographics
Responsibility

All Science Journal Classification (ASJC) codes

  • Economics, Econometrics and Finance(all)

Cite this

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abstract = "The new tax assessment system is known as Self Assessment System (SAS), whereby the individual taxpayers have to compute their chargeable income and tax return on their own before remitting the payment to Inland Revenue Board (IRB). However, it is anticipated that this system could increase the probability of non compliance due to the lack of understanding and knowledge on how to compute the chargeable income. In this paper, we are interested to test basic tax knowledge of the taxpayers as consumers on their rights and responsibilities on tax relief and business deduction. Beside that, this study also examines whether there is a significant difference in terms of taxpayers knowledge in reference to their demographic characters such as age, gender, race and level of education. The research was conducted by distributing questionnaires to business income taxpayers (sole proprietorship) in Kuantan on their basic knowledge on tax computation. The result shows that the level of tax knowledge on personal tax relief and business deduction is still very low among the individual taxpayers. In addition, only the age, race and level of education of the taxpayers have significant difference in terms of knowledge on tax relief and business deduction.",
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