Investing in Stock market & Tax benefit from investment return?

Under Malaysia content, Dividend income is something taxable, even thought tax exemption may be issued for certain company but overall still taxable for long term.
In Malaysia content, Capital gain tax from shares investment is tax empted.

So how to reduce our obligation to paid tax or reduced tax payable? I noticed in Bursa Malaysia very little company given high dividend yields. Namely, DUTCHLADY , BATT,Shell Malaysia and also Public Bank (see other posting for future). Those company consistently given 8% to 10% to the investor, just for example Shell is given RM1.00 for each 1 share (market value at around RM10.20). Almost for sure given around 10% return for investor. Sound attractive, but remember out of RM1.00 dividend received, you need paid tax for 28% or 28 cent for that sum receive, you only received 72 cent.

How to recover the 28% given to government or tax authority? The answer is through tax payment system.

If you are taxpayer with marginal tax rates of 13%, you will able to recover the 15% from that portion through reduced your tax payment. Obviously, Listed Company now trying to declare high dividend to attract investor’s attention. But remember only concentrate to those traditional high dividend yield counters to enjoy such benefit.


Lastly but not less, it is good point to consider invest in those company with high yield. The benefit include high return on dividend (FD only 4%). But remember to declared it and keep the dividend voucher for tax purpose.