Paying one’s taxes can be a daunting task, especially if one is not familiar with tax codes and regulations. Thankfully, in Malaysia, the government provides various reliefs to help individuals reduce their tax burden.

Reliefs are specific deductions that can be claimed by individuals when filing their income tax returns. These are also a way for the government to encourage certain behaviours or to support certain expenses.

Below is a list of reliefs available to individuals who are eligible to pay income tax for the year of assessment (YA) 2023. This information is based on the official website of the Inland Revenue Board (LHDN), where you can obtain more comprehensive information.

1. Special needs and medical expenses

Individuals who support their dependents are entitled to a tax relief of up to RM9,000, the same as last year.

Medical expenses for one’s parents, with conditions certified by a medical practitioner, are eligible for a relief amount of up to RM8,000.

Tax relief of up to RM6,000 is provided for basic equipment to support disabled family members, including the taxpayer themselves.

Up to RM6,000 in tax relief is available to disabled individuals, while those with disabled spouses are entitled to a relief amount of up to RM5,000.

Individuals who incur medical expenses for themselves, their spouses or children are entitled to a relief amount of up to RM10,000 for:

• serious diseases, fertility treatment, or vaccination fees;
• complete medical or mental health examinations, and Covid-19 test kits;
• assessment of intellectual disability diagnosis or early intervention programme/intellectual disability rehabilitation treatment, for a child aged 18 and below.

2. Lifestyle expenses

Individuals who incur the following expenses for personal use, or that of their spouses or children, are entitled to a relief amount of up to RM2,500 for:

• books, journals, magazines, newspapers or other similar publications that are not banned by the government;
• personal computers, smartphones or tablets not meant for business use;
• equipment for sports recognised by the government, and gym memberships, while an additional RM500 is available for sports equipment, rental or entrance fee to any sports facility, or registration fee to any sports organisation approved by the government;
• payment of monthly internet subscriptions, which must be under the individual’s own name.
  Alimony payments to former wives or husbands entitle the taxpayer to RM4,000 in relief.

Owners of electric vehicles that aren’t for business use can claim a tax relief of up to RM2,500 for expenses on charging facilities.

3. Childcare and education

Once every two assessment years, individuals who purchase breastfeeding equipment for their children aged two years and below can claim a relief amount of up to RM1,000.

Fees to a registered childcare centre or kindergarten for children aged six years and below are entitled to a relief amount of RM3,000.

Individuals who pay for their education are entitled up to RM7,000, but certain restrictions apply based on the type of education pursued:

• other than a degree at masters or doctorate level: course of study in law, accounting, Islamic financing, technical, vocational, industrial, scientific or technological;
• degree at masters or doctorate level: any course of study;
• course of study undertaken for the purpose of upskilling or self-enhancement.

Individuals who make a net deposit in Skim Simpanan Pendidikan Nasional Prime (SSPN Prime) are eligible for a relief amount of up to RM8,000.

Parents can claim a tax relief of up to RM8,000 for each unmarried child aged 18 years and above who receives full-time education in or outside of Malaysia. These include A-levels, a diploma, or a master’s degree from an institution approved by the relevant government authority.

Parents can also claim an additional exemption of RM8,000 for a disabled, unmarried child aged 18 and above. He or she should be pursuing a qualification for a diploma or above in Malaysia, or a bachelor’s degree or above overseas. These programmes must be accredited by the relevant authority.

4. Insurance and EPF

For those under civil servants’ pension schemes, non-civil servants pension schemes, and self-employment, tax reliefs of up to RM3,000 can be claimed for life insurance premium payments, family takaful contributions, or additional voluntary contributions to EPF.

Additional tax relief of up to RM4,000 can be claimed for mandatory contributions to approved schemes, voluntary contributions to EPF (excluding private retirement schemes), or contributions under any written law.

Tax relief of up to RM3,000 can be claimed for contributions to a deferred annuity and private retirement scheme, and an additional RM3,000 for premium paid for education and medical insurance.

Employees who contribute to Socsco can claim a tax relief of up to RM350.

Do bear in mind that these reliefs may be subject to certain requirements, so again, check out the LHDN website for full details.

Finally, note that May 15 is the final date for the e-filing of Form BE YA 2023 and payment of taxes for individuals with employment income.

This article was written by Zack Lee for MyPF. To simplify and grow your personal finances, follow MyPF on Facebook and Instagram.