Finances

This is another topic on GST awareness. This time we talk about share market investment, your share trading account and transaction costs. Every share investor should read this article. Let's start here... Many share investors already started their "wait and see" approach since last week because many of us don't know how GST is going to impact our share investment after 1st April 2015. Basically, each transaction consists of the following 3 types of charges: Brokerage fee Normally, the charge is 0.42% (online trading) and 0.60% (offline trading). Some of you may find it to be as low as 0.10% (intraday trading). Yes , this fee is subject to 6% GST. After 1st April, it will become 0.4452% (online trading) and 0.636% (offline trading). Clearing fee This fee is basically charged by Bursa Malaysia and it was fixed at 0.03% of the transaction amount. Yes , this fee is also subject to 6% GST and it will become 0.0318% after this. Stamp Duty This is calculated as RM1 stamp du...

It's been hotly speculated by all Malaysian since the day one goods and services tax (GST) being announced. Malaysia being one of the highest car ownership country in the world, anything to do with car prices definitely will become the nation's topic. Here, we look at this topic as a whole with the latest updates: Why everyone speculating that car prices will drop? Currently, there is a  10% vehicle sales tax  on each vehicles sold. With the implementation of GST, which is charging 6% as announced, this will replacing the existing sales tax. In other words, the 10% sales tax will be abolished on April 1. A straight-forward calculation means there is a saving of 4% effectively. But, that's not the case. Practically, we need to take into considerations below factors also: Logistic costs which subject to 6% GST Currency fluctuation for imported cars or components Based on current situation where Ringgit keeps on depreciating in value, it will definitely increase the import cos...

For credit card holders, there is confusion on how GST is being charged. Over here, we are talking about the service tax and annual fee. Currently, there is a RM50 service tax on principal card holder and RM25 service tax on supplementary card holder.  After 1 April 2015, this service tax will be abolished due to the implementation of GST. How about the annual fee? However, 6% GST will be imposed on the credit card annual fee which ranges from RM50 up to RM500, depending on the type of card. For example, for a RM50 annual fee, there will be an extra RM3 GST charge on it, resulting to a total of RM53 when renew. Anyway, most of the banks will waive the annual fee if card holder meet certain minimum requirements, or card holder can utilized their loyalty points or rebates to offset the 6% GST. How about late payment or finance charges ? Late payment charge means card holder fails to pay at least the minimum monthly charges when due. Meanwhile, finance charge means charges ...

While writing this post, major dailies are reporting that our currency Ringgit (MYR) is weakening against USD drastically . Yes, it does pose some financial risk to our country. We can't deny that we are on the losing side now and we as a Malaysian should know what's happening now. Why Ringgit so weak? First, when talking currency, it's always must refer to which currency we are referring to. Here, we take USD, being the world's most traded currency, be our guide. In summary, we can break it down to the following reasons to explain the depreciation of Ringgit: The recovering of US economy Undeniably, after the 2008 global financial crisis, US economy is slowly recovering and the momentum has started to pick up since last year. Continue good numbers has already prompt US Federal Reserve to consider begin raising interest rate. Theoretically, a country's currency will appreciate during rising interest rate environment. This explains why stronger USD. Falling prices o...

Everyone cannot runaway from Goods and Services Tax (GST) which is going to be implemented starting 1st April 2015. How about our life insurance policy? How is it going to affects our policy then? All types of coverage also subject to GST? Unfortunately, most of our life insurance policy coverage also will be subject to GST charges. It depends on what type of life insurance policy you mention. It could be pure life, endowment, child education, medical and health, personal accident or annuity plans. In summary, below table shows you what type of coverage is subject to GST: Actually, how to calculate the additional GST charges? The GST charges will imposed on those insurance charges and all other policy fees as mentioned above. Example, for standalone medical card, if the annual premium is RM1,000, then the revised premium including GST would be RM1,060 (RM1,000 + RM60 GST). But, it's not so straight-forward for investment-linked plan (ILP) which having other non-life riders attache...