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Tag: Information

Info : How to Purchase a Property Using Your EPF Withdrawal Money

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Most Malaysians find it difficult to take on the substantial commitment of purchasing their first home, worried with whether they’re able to financially keep up. What with the hefty downpayment required (usually 10% of the sale price) and the subsequent monthly loan repayments, is it any wonder that most urban millennials are still living with their parents?

Now there might be a way for those who’d like a little extra help in financing their home-related expenses: dipping into their Employees Provident Fund (EPF) savings! In particular, Account 2 is what you’d need, which we’ll show you how to claim in the handy step-by-step process below.

First things first, register for i-Akaun

On the EPF website, register for the i-Akaun facility. The fastest way to do so is through any nearby EPF Kiosk or counter. Alternatively, you can also contact the EPF Contact Management Centre at 03-8922 6000. Once registered, you’ll need to activate your account by logging in to your i-Akaun as shown below:

EPF has made it very convenient for home purchasers to apply for withdrawals online rather than doing it manually over the counter. However, for first-time applicants, you’ll still need to present yourself at the counter. Subsequent applications can then be made via the site. Once you’re in, you’ll be taken to a page where you can select the different withdrawal types from the drop-down list (as below):

For first-time homebuyers: Withdrawal to purchase (or build) a house

You’ll first have to fork out the 10% downpayment yourself, payable to the developer for a new property or to the property owner if purchasing a sub-sale house. Only then will you be able to secure a home loan from a bank/financial institution and sign the Sales & Purchase Agreement (SPA). As soon as your SPA is signed, immediately apply to EPF in order to redeem the amount paid for the downpayment.

One can apply to withdraw the difference between the house price stated in the SPA and the housing loan amount (which is typically 90% as most first-time homebuyers have to submit a 10% downpayment), on top of an additional 10% on the price of the house. For example:

SPA price: RM500,000
Loan amount (90%): RM450,000
Amount you can withdraw: (RM500,000 – RM450,000) + (10% x RM500,000) = RM100,000

*Of course, withdrawals are limited to the savings amount in your Account 2.

“What if I am unable to come up with the 10% downpayment in the first place?”

You can explore 100% financing schemes offered by a few banks. One such bank is MBSB, subject to certain conditions. However, applicants under this category can only withdraw up to 10% of the property price. So say your home costs RM500,000, you will be eligible to withdraw RM50,000 only.  Alternatively, you will have to borrow or pool money from your parents, relatives or close friends in order to secure a 90% home loan. You can then pay them back with the monies withdrawn from your Account 2. It is wise to accumulate a sufficient amount of savings first before making your move; you wouldn’t want to be indebted to your loved ones for a long time.

REQUIRED DOCUMENTS:

  • EPF Withdrawal Application Form 9C (AHL) (D5)
  • Your Malaysian Identity Card (first time only). Thumbprint verification will be captured for subsequent applications.
  • Bank loan documents (Letter of Loan approval or Loan Facility Agreement) certified by your borrowing bank. Inform the bank officer your intention to withdraw from your Account 2 and the rest will be done for you. You can either collect the documents yourself at the branch or have it mailed to you (usually within two weeks). Hence, make sure to collate your documents a few weeks before.
  • Bank account information. Members are encouraged to bring their bank passbook OR a copy of their bank statement.
  • Sales & Purchase Agreement (SPA)

CRITERIA:

  • Aged below 55 years at time of application.
  • Have at least RM500 in Account 2.
  • The property in question has to be for residential purposes only i.e bungalow/terrace/semi-detached/apartment/ condominium/studio apartment/serviced apartment/townhouse/SOHO or a shop lot with a residential unit.
  • Can either be a Malaysian or non-Malaysian as long you are an active member and have been making EPF contributions.
  • Your home purchase can be either financed by a home loan granted by banks or via an outright cash purchase. More details here.
  • Withdrawal is only valid for one property (house) at any one time.  Should you wish to apply for a second home, this is only possible once you have disposed of your first property. You must submit the proof of transfer of ownership.
  • The application must be made within 3 YEARS of signing the SPA.

*If it has been over 3 years since your house purchase, don’t worry. You still have the option to apply for withdrawal on a monthly basis to reduce your housing loan (discussed below).

A plus point: EPF is very efficient in processing applications. The whole process takes less than three weeks from the day of application to the point of the money being deposited into your account. Once your application is approved, you will receive an SMS requiring you to be present at any EPF counter for thumbprint verification.

Did you know: EPF withdrawals made for home loan purposes are not subjected to tax!

For those who’ve already purchased a property: Withdrawal to help pay instalments or to reduce housing loan

Let’s say you weren’t aware of the withdrawal option mentioned above, and you have already purchased a property over three years ago. You can still opt to withdraw your EPF money to assist with paying your monthly instalments or to pay down the capital of your home loan to save on interest costs.

CRITERIA:

1) Same as above for Criteria 1-5
2) The house in question must be your first residential property/house.
3) You must be an owner of the property and have an outstanding home loan with a bank.

The next step will be to obtain the latest loan balance statement from your bank and submit it to EPF. Your bank will take about two weeks to process this.

You may apply to withdraw all of your savings in your Account 2 but this will be paid on a monthly basis, not exceeding the amount of your monthly housing instalment. For example, say your monthly repayment is RM1,000 and you have a total of RM10,000 in your Account 2. RM1,000 will be credited into your personal account or directly to your borrowing bank each month, over a course of ten months.

NOTE: Those who have applied for withdrawals before the three-year mark of their home purchase can request for the EPF money to be paid in a lump sum to help pay down their home loan balance.

Again, the whole process is pretty speedy and takes less than three weeks to complete. An example of the timeline is as below:

An application was made on March 19 and it was submitted for the bank’s verification on home loan details. The bank in question approves said details within a week on March 26. The following day (March 27), EPF proceeded to process the application and it was finalized on April 4. You will be given a period of two weeks to present yourself at EPF counter for thumbprint verification. Once that is done, the money will be disbursed to you within 3-4 days.

To use Account 2, or not to use Account 2

We’d recommend you do your due diligence and go through the detailed explanations available on the EPF website to gain a better understanding before making a decision. Better yet, walk into any EPF office and speak directly to the officer on duty regarding your withdrawing options from Account 2.

Now that you’re aware of additional financing options that bring you one step closer to your dream home, you’d need to also make sure that you’re qualified for a home loan in the first place. Use this comprehensive tool to determine your eligibility across 15 banks – free of charge!

We wish you the best of luck!

 

credit :loanstreet.com.my

INFO : Here’s How to Compare Home Loans Across 15 Banks (In 3 Easy Steps)!

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“Time is money,” quipped Benjamin Franklin, and would you ever want your time to be wasted on something unnecessary? Case in point: the tedious task of having to go from one place to another, just to get the comparison you need for a particular product or service.

Major financial decisions such as a home loan traditionally takes a long time to obtain, sometimes without guaranteed success. Many homebuyers are turned off by this complicated process, the hassle of which also prolongs the buying decision process.

While in the past, you’d need to contend with travelling from one bank to another, there’s now a handy tool which does all the dirty work for you:

 Home Loan Eligibility Report

The unique selling point: a comprehensive report which contains all the vital information you’d need, instantly at your fingertips. Let’s have a closer look!

 

1) Step one: Fill in personal details

This tool simplifies the entire monotonous process of filling in your personal details to that of just a few questions – eight to be exact! These questions are no-brainers, as can be seen below.

After you’ve filled up the first few basic fields, the next one would prompt you to fill in your PCB (scheduled income tax deduction). For the uninitiated, PCB is a mandatory system where the employer is required to deduct monthly tax payments from the income of their employees, so there’s no escaping it. Do note that tax payees would still need to file their returns with the Inland Revenue Board Malaysia (LHDN) for the final tax figure.

There are just a few more questions after that, and then the calculator will provide you with a brief summary of all the details you’ve keyed in for reconfirmation. Notice that the entire process only took five minutes of your time?

 

2) Step two: Receive complete report

Once you’ve checked that your information is correct and submitted it, you’ll instantly receive an average result summary on your screen. It gives the applicant a clear idea of what to expect from each bank, such as the maximum loan amount affordability and the debt servicing ratio.

For more in-depth information as to what is the indicative amount you can receive from 15 banks in Malaysia, all you’d need to do is provide your email address and the complete report will be provided to you within 15 minutes, fuss-free! Here’s what to expect in your inbox:

 

3) Step three: Make your choice

Now all that’s left to do is refer to the list of banks and then proceed to choose the one that fits all your present needs – from the instalment amount to the loan amount. Since there are 15 on the list for you to choose from – and there are even rating guidelines provided to show which banks have a higher chance of loan approval – this is as easy as 1-2-3!

CREDIT : loanstreet.com.my

INFO : 6 Perks The Rakyat Can Benefit From 0% GST

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After nearly 3 years living with the system, 6% Goods and Services Tax (GST) is now out of the picture. It was made possible after the major victory that Pakatan Harapan has achieved in the recent General Election.

This move by the government is expected to lessen our (the rakyat) burden. On top of that, it’s supposed to give us better purchasing power and promote economic growth. To date, we have seen some changes in terms of everyday expenditure. In case you’re still lost, here are some of the perks that YOU can leverage from the zero-rated GST.

#1 A Golden Opportunity To Buy A Car

As part of the government’s move to zero-rate the GST, auto companies have revised their vehicles’ prices down. For example, Perodua has reduced the prices of its cars up to RM3,500. Yes, you read that right. Click here to see the newly revised price across the model line-up.

Amongst the companies that have also revised their vehicles’ prices are Volkswagen Passenger Cars Malaysia Sdn Bhd, UMW Toyota Motor Sdn Bhd and BMW Group Malaysia.

Additionally, according to Federation of Motor and Credit Companies Association of Malaysia (FMCCAM) President, Tony Khor Chong Boon, used cars prices are also anticipated to be slightly reduced between 1% and 4% due to this trend.

So do take this chance to get yourself a car before the SST kickstarts in September. In a statement, AmBank Group Chief Economist, Anthony Dass, shared that car prices are expected to increase marginally after SST kicks in. That being said, he also said there are possibilities for auto players to probably absorb the cost (depending on the potential demand).

 

 

#2 Start Hunting For Your Dream Home

With GST out of the way, property experts/consultants have shared that this act would encourage the property buyers to make a purchase. According to a local daily, FD Iskandar, Real Estate and Housing Developers’ Association (Rehda) President, shared that property prices are expected to drop following the zero-rated GST implementation.

Sharing the same sentiment is Knight Frank Malaysia Managing Director, Sarkunan Subramaniam. He said: “With the announcement of zero-rated GST, property buyers who intend to purchase commercial properties can now make their decisions as the transaction price will now [from June 1] be cheaper, as they do not need to pay the 6% GST. For residential properties, as building and raw materials will not be charged 6% GST, the selling price is expected to reduce.

 

#3 You’ll Spend Less At The Supermarket

For most shoppers (if not all), 1 June 2018 was the beginning of happy days simply because they get to buy things at 6% less. We’re sure that you’ve witnessed a lot of the “0% GST” labels.

Recently, The Star had made a spot check to some of the stores if the price tag has changed. The local daily reported that a 1.2kg bag of cat food that was priced at RM14.90, became RM14.05, after 0% GST. Besides that, a packet of 3-in-1 coffee sachets, which was initially RM14.31, is now priced at RM13.50. These items were seen at AEON Supermarket.

Image via MalayMail

You can also see goods’ prices comparison from Hargapedia. It has been monitoring the prices of groceries, household, health & beauty products across 6 different retailers – Giant, Tesco, Econsave, Aeon Big, Aeon and 99Speedmart.

Nevertheless, don’t be confused with the already tax-exempted goods i.e. fresh and frozen meat/fish, fresh vegetables, spice and herbs, baby formula and more. Check out the full list from the Federal Gazette here.

 

 

#4 Smokers, Your Lungs Would Likely Be Less Intoxicated

OK, this may be bad news for some of us. In order to curb smoking habits amongst our fellow Malaysians, the government has decided to maintain the retail prices of tobacco products including cigarettes. This is also part of the commitment to the World Health Organisation Framework Convention on Tobacco Control.

The Finance Ministry made a statement recently that removing 6% GST should not be an excuse to sell cigarettes cheaper. This is because the product is harmful to your health and lowering the price would be a form of promotion which is conflicting with the Control of Tobacco Product Regulations 2004.

Perhaps we can look at this matter from a different lens. Maybe it’s time to slowly quit the bad habit and lead a healthier lifestyle. Who’s in?

 

 

#5 Electronics/ Gadgets Are Cheaper Now

Have you been planning to buy a new smartphone, laptop or any electronic stuff? This is the time. Before this, all the gadgets/electronics’ prices were inclusive of 6% GST. Now, with 0% GST,  you can save up to a maximum of RM60 for a smartphone that is priced below RM1000.

Imagine how much you can save if the product is worth RM3,000. As an example, iPhone prices have been reduced up to RM334 due to the zero-rated GST. That’s a lot! However, do take note that the price might change once the SST is implemented.

 

 

#6 Complete Your Bank Transaction Without GST

If you’re the kind of person who frequently makes bank transactions to pay your bills, this must be good news for you. Why? Because you no longer have to pay 6% extra anymore.

FYI, all of the conventional commercial banks in Malaysia will be charging 0% GST for all banking products and services. This has been confirmed by the Association of Banks in Malaysia (ABM). If you need more info or have any banking issues, get in touch with ABM at 1-300-88-9980.
 

Conclusion

There you have it. Of course, there are more things that you can benefit from the 0% GST such as movie and concert tickets, electricity, telco services, insurance and more.  As you can see, most of the everyday products and services have already been reduced.

If you still see the same old price, it could be that the stores are still in the midst of changing their price tags. According to the news, business premises are allowed to take some time to retag their goods with new prices following the requests for a grace period.

Image via Malaysian Digest

Having said that, please be wary and check your receipt again. Many netizens have been complaining on their social media that some businesses hike their prices after GST zerorisation. In case you encounter shops that still charge you 6% GST or exploit the zero-rated GST i.e. price hike, you can file a complaint to KPDNKK through these channels:

– Call 1Malaysia One Call Centre (1MOCC) at +603-80008000

– Call Information and Strategic Operations Movement Centre (PIGOS)  at +603-88826088/6245

– Use this app called Ez ADU

– Send an email to aduan@kpdnkk.gov.my

CREDIT : Loanstreet.com.my

INFO : 5 Property tax savings you should know

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1. RPGT (REAL PROPERTY GAINS TAX) – WAIT IT OUT!

By now you should know understand a thing or two about RPGT. If not, do a quick google search, and you will find out more about it. The table above will give you some insights into understanding how much will you be taxed if you dispose your property. A hint, it’s got something to do with timing. Generally, anything after 5 years is tax free for Malaysians with a residential property and 5% tax if you’re a company or a non-citizen.

If you’re a citizen or a PR holder, you’re entitled to a further tax relief of RM10,000 or 10% of the chargable gain whichever is a greater accrue to an individual.

2. PASS GO NOW

Did you know as Malaysians, you’re entitled to waive off RPGT at least once in your life? Be sure that the property is in your name, and not joined with your partner. Otherwise you and your partner would waste it on only one property disposal and not two.

3. FURNISHING / RENOVATION

Furnishing or renovating your home can be considered as part of your cost against RPGT, but you have to make sure that the items in the house goes with the sale (what you’re claiming for). So keep those receipts and invoices from your interior designer and contractors. It will contribute to lowering taxes if you’re thinking of selling your property within the 5-year window.

4. GST: COMMERCIAL VS RESIDENTIAL

Things have been unclear for those holding on to Commercial properties. According to customs, if a person owns more than two commercial properties or land (more than one acre combined) with a market value of more than RM2mil and has an intention to sell, they are considered to be in business. Thus, a 6% GST fee will be implemented and the owner will need to apply for a GST number.

Does this mean that if I have two properties and I’m on the verge to buying the 3rd, but I am selling off one of my earlier properties means that I am free from GST? Maybe, it’s possible after fulfilling certain criteria.

If you own a residential property, you don’t have to pay GST – there’s RPGT for that.

5. KEEP IT WITHIN THE FAMILY

Tax can be avoided if any property transfers that happen between immediate family members / spouses ie. Transfer by way of gift between husband and wife, parent and child, or grandparent and grandchild, provided that the donor is a citizen and the gift is made within five years after the date of acquisition by the donor.

CREDIT : BUMBUNG.CO