10 things to know for filing your Malaysian income tax in 2019. Know the deadlines, charges and procedures. Learn how to maximize your tax reliefs and tax exemptions.
1. Tax Submission & Filing Deadline
Individuals who earn an annual employment income of RM34,000 above (after EPF deduction) have to register for a tax file.
Registration can be done at the nearest Lembaga Hasil Dalam Negeri (LHDN; Inland Revenue Board of Malaysia) branch or online via e-Daftar.
Documents required for registration
- Copy of latest salary statement (EA/EC Form) or latest salary slip
- Copy of NRIC / passport
- Copy of marriage certificate (if applicable)
The final deadlines for submission of BE Form Year 2018 (year of assessment 2018)
- Manual filing: April 30, 2019
- Online filing: May 15, 2019 (15 days extra)
2. Income Tax Rate
For 2018, the highest tax bracket remains at 28% for income RM1,000,000 beyond. The overall tax payable is slightly lower by approximately RM1,000 as the tax rate for chargeable income RM20,000 – RM35,000 is reduced from 5% to 3%.
3. Medical Tax Relief
Medical expenses for parents tax relief is allowable up to RM5,000.
(If your parents are healthy, you can still claim for individual parent allowable up to RM1,500 for one mother or father respectively.)
Medical expenses for serious diseases for self, spouse or child is allowable up to RM6,000. This includes a completed medical examination limited to RM500 (this a full and comprehensive medical examination – check with the location you are doing the medical examination to confirm if it is allowable for tax relief).
4. Lifestyle Tax Relief
Lifestyle tax relief is allowable up to RM2,500 from the following:-
- Purchase of books, journals, magazines, printed newspapers
- Purchase of personal computer, smartphone or tablet
- Purchase of sports equipment and gym membership
- Payment of monthly internet subscription bill
5. Child-related Tax Relief
Ordinary child relief of RM2,000.
Purchase of breastfeeding equipment allowable up to RM1,000.
Child care fees to kindergarten or child care centre up to RM1,000.
Unmarried children age 18 above receiving further education of RM8,000.
6. SSPN Savings Tax Relief
Net savings in SSPN in 2018 allowable up to RM6,000 for each e-filing (Both parents can claim tax relief up to RM6,000 each as long as filing separately).
Inclusive of both SSPN-i and SSPN-i Plus.
This is the net of total deposits minus total withdrawals in the year (so you can’t be funny trying to manipulate deposits and withdrawals).
7. EPF, Life Insurance, Deferred Annuity, PRS, Insurance for education/medical, SOCSO Tax Relief
Life insurance and EPF allowable up to RM6,000.
Deferred annuity and PRS allowable up to RM3,000 (until year of assessment 2021).
Insurance premium for education or medical benefit up to RM3,000.
Contribution to SOCSO up to RM250 (the actual contribution cap for an individual is maxed out at RM237).
8. Education Fees Tax Relief
Education fees allowable up to RM7,000.
For non-masters/doctorate in law, accounting, Islamic financing, technical, vocational, industrial, scientific or technological skills or qualifications.
For masters/doctorate in any field or qualification.
9. Donations and Gifts
Unlimited tax exemption for donations to Tabung Harapan Malaysia where a total of RM200m was donated to the fund. Your tax exemption is equal to the amount donated Ringgit for Ringgit.
Zakat/Fitrah subject to the maximum of tax charged.
Gifts to government, state government, local authorities, and other approved institutions or organisations (some categories limited to maximum 7% of aggregate income).
10. TAC Registration for Income Above RM450,000
1st time taxpayers with reported income RM450,000 or higher through e-Filing must apply for TAC. TAC will be sent to your LHDN registered mobile number. This does not apply if submitting e-Filing through tax agent.