It’s tax season, and you’ve got until the end of April to get your e-filings in. While it’s important to keep your receipts for tax reliefs, storing them can be quite tricky. After all, they’re just pieces of paper that could fade or even get lost.
On this episode of Ringgit Bytes, Mr Thanneermalai, Managing Director of Thannees Tax Consulting Services discusses why we keep receipts, what to do if you’ve lost them, and some tax filing tips to ensure that you never lose another receipt.
Hi, I’m Roshan Kanesan and this is Ringgit Bytes.
TAX FILINGS: What do I do if I lose my receipts?
It’s tax season and you’ve got until the end of April to get your e-filings in. Now, as you probably know, it’s important to keep your receipts for tax reliefs that you utilize but storing them can be tricky. After all, they’re just pieces of paper that can get lost or faded with time. Today, we sit down with Thanneermalai, Managing Director of Thannees Tax Consulting Services, to discuss why we keep receipts, what to do if you’ve lost them and get some tax filing tips to make sure you never misplace another receipt.
Why do I even need to keep receipts? Do we need to keep them forever?
There is requirement for you to keep it for seven years, company law requires you, income tax also requires you to keep the same thing for seven years, that’s one. Number 2, if you don’t keep the records, how will you prove the deductions or the reliefs that you’re claiming? For example, for your lifestyle relief, you have RM2500, now in the pandemic period, they’ve given you another two, to two and a half thousand. So, these receipts need to be kept. Otherwise, you’ll be over claiming or under claiming. So, you need the receipts to prove that you’ve actually spent the money.
What are some tips to preserve documents?
What you need to do is actually photocopy it. Otherwise, now with your iPhones and all the other phones you have, you can just take a picture of it and keep it and then download it and keep it as a soft copy somewhere and just store that file because the income tax department even customs, when it comes to anything like service tax, etc., they will accept the soft copy and even the courts will accept it. If you can’t find the receipt itself, for example you have lost it, then go back to your credit cards because you could have used your credit card, go back to your bank statement.
I’ve lost my receipts. What do I do now?
Let’s say you didn’t keep it anywhere; you have entirely lost the receipts. Then, I think you can look at the sequence of events because you have the same trend, you have the same kind of expenditures that has been spent every month, you can ‘Look here, I am paying this water bill’, ‘I am paying this for my rental of the property that I’m receiving rent from every month’, ‘I’ve just missed out on two months’. So, that’s a reasonableness test. That, I think the authorities will accept. If you able to communicate this correctly, it shouldn’t be a problem.
Top tax filing tips?
Make sure you don’t miss the deadline. Please don’t go in on the 24th hour, at midnight, and try filing it because every other guy will be rushing it and you may or may not be able to get in. That is number one, do it about 5-20 days before the event. Number two, find the records and keep the records and make sure you have the right claims, don’t overclaim, don’t unnecessarily claim which in the future, if you do that, it will become much more disadvantages to you and thirdly, I would also say go through the reliefs. It’s very simple, go through the internet, go through your form, it tells you at the back, about all the reliefs you can claim, please claim it. If you don’t claim you’re basically giving a gift to the government, you don’t need to. Taxes are man-made, it is not mandatory, pay the tax that you should pay, don’t overpay your taxes, don’t underpay your taxes.