Below is a simple guide regarding the tax rates and tax reliefs for those who are eligible.
Tax residence status of individuals
An individual is regarded as a tax resident if he meets any of the following conditions, i.e. if he is:- in Malaysia for at least 182 days in a calendar year;
- in Malaysia for a period of fewer than 182 days during the year (“shorter period”) but that period is linked to a period of the physical presence of 182 or more “consecutive” days in the following or preceding year (“longer period”). Temporary absences from Malaysia due to the following reasons are counted as part of the consecutive days, provided that the individual is in Malaysia before and after each temporary absence:
- treatment for ill-health
- social visits not exceeding 14 days
- in Malaysia for 90 days or more during the year and, in any 3 of the 4 immediately preceding years, he was in Malaysia for at least 90 days or was resident in Malaysia; or
- resident for the year immediately following that year and for each of the 3 immediately preceding years.
Rates of tax
1. Resident individuals
- A qualified person (defined) who is a knowledge worker residing in Iskandar Malaysia is taxed at the rate of 15% on income from employment with a designated company engaged in a qualified activity in that specified region.
- An approved individual under the Returning Expert Programme who is a resident is taxed at the rate of 15% on income in respect of having or exercising employment with a person in Malaysia for 5 consecutive YAs.
Personal reliefs for resident individuals
|
Types
of relief
|
YA
2020 (RM)
|
|
Self
|
9,000
|
|
Disabled
individual - additional relief for self
|
6,000
|
|
Spouse
|
4,000
|
|
Disabled
spouse - additional spouse relief
|
3,500
|
|
Child:
|
|
|
· per
child (below 18 years old)
|
2,000
|
|
· per
child (over 18 years old):
receiving
full-time instruction of higher education in respect of:
- diploma level and
above in Malaysia; or
- degree level and
above outside Malaysia
OR
serving under articles or indentures in a trade or profession in Malaysia
|
8,000
|
|
· per
physically / mentally disabled child
|
6,000
|
|
· physically
/ mentally disabled child (over 18 years of age) receiving full-time
instruction at institution of higher education in respect of:
- diploma level and
above in Malaysia; or
- degree level and
above outside Malaysia
OR
serving under articles or indentures in a trade or profession in Malaysia
|
14,000
|
|
Life
insurance premiums (Note 1)
|
3,000*
|
|
EPF
contributions (Note 1)
|
4,000*
|
|
Private
Retirement Scheme contributions and Deferred annuity scheme premium (until YA
2021)
|
3,000*
|
|
Insurance
premiums for education or medical benefits
|
3,000*
|
|
Expenses
on medical treatment, special needs or carer expenses for parents (evidenced
by medical certification)
|
5,000*
|
|
Parental
care relief (until YA 2020):
|
1,500
1,500
|
|
Employee’s
contribution to Social Security Organisation (SOCSO)
|
250*
|
|
Medical
expenses for self, spouse or child suffering from a serious
disease (including fees of up to RM500 incurred by self, spouse or child
for complete medical examination) or expenses incurred on
fertility treatment (w.e.f YA 2020)
|
6,000*
|
|
Fee
expended for any course of study up to tertiary level other than a degree at
Masters or Doctorate level, undertaken for the purpose of acquiring law,
accounting, Islamic financing, technical, vocational, industrial, scientific
or technological skills or qualifications or any course of study for a degree
at Masters or Doctorate level undertaken for the purpose of acquiring any
skill or qualification
|
7,000*
|
|
Purchase
of supporting equipment for self (if a disabled person) or for disabled
spouse, child or parent
|
6,000*
|
|
Lifestyle
relief consolidated with the following:
|
2,500*
|
|
Purchase
of breastfeeding equipment
|
1,000*
|
|
Fees
paid to child care centre and kindergarten (Note 2)
|
2,000*
|
|
Deposit
for child into the Skim Simpanan Pendidikan 1Malaysia account established
under Perbadanan Tabung Pendidikan Tinggi Nasional Act 1997 (until YA 2020)
|
8,000*
|
Maximum relief
Note:
1. For public servants under the pension scheme, combined relief up to RM7,000 is given on Takaful contributions or payment for life insurance premium
2. Previously the relief was limited to RM1,000 in YA 2019
Tax rebates for resident individuals
Types of rebate
|
RM
|
Individual’s chargeable income does not exceed RM35,000
|
400
|
If husband and wife are separately assessed and each chargeable income does not exceed RM35,000
|
400 (each)
|
If husband and wife are jointly assessed and the joint chargeable income does not exceed RM35,000
|
800
|
Rebate for Zakat, Fitrah or other Islamic religious dues paid
|
Actual amount expended
|
Rebate for departure levy paid for performing umrah and pilgrimage to holy places (w.e.f YA 2019)
|
The actual amount expended (twice in a lifetime)
|
