Know Your Income Tax Relief for YA 2023

Know which tax relief you qualify for to get your well-deserved monetary relief for YA 2023 as a Malaysian taxpayer.

Ding ding ding! It’s income tax season in Malaysia for YA (year of assessment) 2023.

Paying taxes can be a daunting task for many individuals, especially if they are not familiar with the tax laws and regulations in their country. In Malaysia, the government provides various tax reliefs to help individuals reduce their tax burden.

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

Below is a list of tax reliefs available to individuals who are eligible to pay income tax for YA 2023. The information is based on the official website of the Inland Revenue Board of Malaysia (LHDN) and for a more comprehensive list, please refer to the site.

#1. Special Needs and Medical Expenses

For individuals who support their dependents, you are entitled to a tax relief of up to RM9,000, which is the same as last year.

Parent’s medical expenses with medical condition certified by a medical practitioner are eligible for a relief amount of up to RM8,000.

Basic equipment to support their disabled family members, including themselves are entitled to a relief amount of up to RM6,000.

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

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

a) due to serious diseases, fertility treatment or vaccination fees.

b) complete medical or mental health examination, COVID-19 detection test kits.

c) assessment of intellectual disability diagnosis or early intervention programmer/intellectual disability rehabilitation treatment, of a child aged 18 and below.

#2. Lifestyle Expenses

Individuals who incur the following expenses for the use or benefit of themselves, their spouses, or children, are entitled for a relief amount of up to RM2,500.

a) Books, journals, magazines, newspapers or other similar publications that are not banned by the government.

b) Personal computers, smartphones, or tablets that are not meant for business use.

c) Sports equipment for sports that are recognized by the government, gym membership. An additional RM500 is available for sports equipment, rental or entrance fee to any sports facility, or registration fee to any sports organisation that is approved by the government.

d) Payment of monthly internet subscription which must be under the individual’s own name.

Alimony payment to their former wives or husbands are entitled to RM4,000 of tax relief.

Owner of electric vehicles can claim a tax relief of up to RM2,500 for expenses on charging facilities for electric vehicles. This relief is applicable for expenses incurred on charging facilities that are not for business use.

#3. Childcare and Education

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

Child care fees to a registered child care center or kindergarten for children aged six years and below, the relief amount is 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 as follow;

a) Other than a degree at masters or doctorate level – Course of study in law, accounting, islamic financing, tehcnical, vocational, industrial, scientific or technology

b) Degree at masters or doctorate level – Any course of study

c) 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 relief amount of up to RM8,000.

Parents can claim a tax relief of up toRM8,000 for each unmarried child of 18 years and above who is receiving full-time education in or outside of Malaysia such as A-Level, further studies such as diploma or Masters, from an instituition that is approved by the relevant government authority.

Parents can also claim an additional exemption of RM8,000 for a disabled child who is 18 years old and above. He or she should not be married and is pursuing either diplomas or above qualification in Malaysia, or bachelor degree or above outside of Malaysia. These programs must be accredited by the related government authorities.

#4. Insurance and EPF