TAX QUESTIONS? YOU ASK LAH!
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Q: I am a director of a company who receives director fee of RM100,000 per year. Should I declare this income in Form B or Form BE?
A: Where the director's fees arise from a contract of service, the fees are generally regarded as employment income and should be declared in Form BE. A contract of service refers to an employer-employee relationship, where the director performs duties as an employee and is subject to the company's control and employment terms. Conversely, where the director's fees arise from a contract for service (e.g. independent director) , the fees are generally regarded as business income and should be declared in Form B. A contract for service refers to an independent consultant relationship, where the director provides services in their own capacity and is not regarded as an employee of the company.
Wishing you plentiful tax savings!
Zen Chow
YYC Tax Guru
