Arif, a 42-year-old lecturer, is married to Siti, a homemaker, and they have two children. Arif earns RM120,000 annually and contributes 11% of his gross income to EPF. He spent RM9,000 on childcare fees, RM12,000 on medical expenses for his elderly parents, RM6,000 in insurance premiums, and RM2,500 under the lifestyle tax relief. Siti does not have personal income but has claimed RM5,000 for donations to approved charities.
1. Compute Arif’s taxable income and tax payable under both joint assessment (Arif as the principal taxpayer) and separate assessments (Arif and Siti assessed individually). Identify which reliefs have ceilings and apply them correctly.
2. Compare the total tax liabilities under both methods and justify which is more advantageous for the couple.
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