Confused by what tax reliefs you can claim? Check this list
Filing taxes doesn’t have to be confusing. It is relatively simple once you understand what tax reliefs are and how they apply to you. The government offers a wide range of personal tax reliefs such as education, healthcare, lifestyle and family welfare to help you reduce the amount of taxes you have to pay., Here’s a quick guide to everything you can claim under Malaysian personal tax relief.
What is tax relief?
Unlike tax rebates, which directly reduces your tax payable, tax reliefs work by decreasing your chargeable income before the tax rate is applied. For example, if your annual income is RM50,000 and you qualify for RM10,000 in tax reliefs, your taxable income will be reduced to RM40,000. This system is designed to provide financial support for essential expenses like medical bills, education, electronics, sporting equipment, books and housing while encouraging responsible spending. You should get into the habit of keeping the receipts of any purchases that qualifies for tax relief and use them when filing your taxes the following year. Even after filing your taxes, remember to keep all your receipts for seven (7) years, as Lembaga Hasil Dalam Negeri (LHDN) might conduct random audits to check if your claims are genuine. This also means that when claiming for tax reliefs, you must check that the tax relief is still applicable for the assessment year that you are filing for, as the tax reliefs can change from year to year.
So now that we understand what tax relief is, let’s have a look at what are the types of tax reliefs you can claim.
1. Self and dependent relief
This is the most basic form of tax relief, the Individual Relief, which applies to every taxpayer. In this category, you are entitled to:
- RM9,000 for individual and their dependents
If you’re supporting dependents, you may also qualify for additional relief such as:
- RM2,000 for each unmarried child under the age of 18
- RM4,000 for unemployed husband/wife/payment of alimony to former wife, among others
2. Lifestyle reliefs
The Malaysian government supports future planning and encourages learning by providing several lifestyle-related tax reliefs such as:
- Lifestyle relief: Up to RM2,500 for purchases like books, smartphones, tablets, computers, internet subscriptions, and even skill improvement/personal development course fee.
- Pension/Retirement fund contributions: Up to RM4,000 for contributions made to approved pension funds, such as EPF and private retirement schemes.
- Medical expenses for parents: Up to RM8,000 for medical treatment, care, or special medical equipment for parents.
3. Education and training
Investing in education not only benefits your future but also reduces your taxable income:
- Self-education relief: Up to RM7,000 if you’re taking any courses that improve your skills or qualifications.
- Education insurance premiums: Up to RM3,000 for premiums paid toward education insurance policies.
Additionally, if you’re pursuing professional certifications or attending workshops, these costs may also qualify under this category.
4. Medical and health-related reliefs
Healthcare is another area where taxpayers can claim significant relief:
- Medical expenses for serious diseases: Up to RM10,000 for treatments related to serious illnesses such as cancer, kidney failure, or heart disease for yourself, spouse, or child.
- Basic supporting equipment: Up to RM6,000 for the purchase of wheelchairs, hearing aids, or other assistive devices for disabled individuals.
- Medical check-ups: Up to RM1,000 for annual health screenings for you, your spouse, or children.
5. Homeownership and housing loan interest
Owning a home comes with its perks, including tax relief:
- Housing loan interest relief: Up to RM7,000 for interest paid on loans taken for purchasing your first residential property (subject to specific conditions).
Note: This relief is only applicable for three consecutive years of tax assessment.
6. Social responsibility and charity
Contributing to society doesn’t just make you feel good—it can also lower your tax bill:
- Zakat / Zakat fitrah: Fully deductible from your chargeable income.
- Donations to approved institutions: Contributions to recognised charitable organisations are eligible for tax deductions.
7. Green technology and environment-friendly investments
Going green pays off—literally:
- Green investment relief: Up to RM2,500 for investments in environmentally friendly initiatives, such as Electric Vehicles (EVs) chargers and food waste composting machines.
However, do take note that this particular tax relief is only claimable once every three years of assessment.
8. Sporting equipment and facilities
Staying active and getting fit not only makes you feel better, but it also helps you with your taxes:
- RM1,000 for sporting activities, such as purchase of sports equipment, rental of sporting facilities, or the entry fee for any sports competition
Note: Entry fee for sports competition requires the organisers to be approved and licensed by the government.
Tips for maximising your tax relief claims
- Keep proper documentation: Always retain receipts, invoices, and official documents for all claims.
- Stay updated: Tax regulations and allowable reliefs may change annually, so stay informed about updates from LHDN (Lembaga Hasil Dalam Negeri Malaysia).
- Consult a professional: If you’re unsure about what you can claim, consider seeking advice from a tax consultant or accountant. Or, you can go straight to the source and call the LHDN careline.
- Be mindful of the deadline: The tax filing season in Malaysia starts on the 1st of March and ends on the 30th of April, so make sure you’re filing your taxes in this period. If you miss the deadline, you will be charged with a late filing penalty.
Final thoughts
By understanding these provisions, you not only reduce your taxable income but also contribute to building a better future for yourself and your family.
So, before filing your taxes, review the list above carefully and ensure you’re claiming and enjoying the deductions you’re entitled to.