Tax Deductions
The following compulsory and optional deductions in the year 2019 are deducted from your annual taxable income to arrive at your annual chargeable income, based on which the amount of tax payable will be calculated. Employees can claim optional deductions by submitting form TP1 to their employer.
Compulsory Deductions
Deduction |
Amount limited to (RM) |
Individual Deduction for an individual in respect of himself and his dependent relatives is granted automatically. |
9,000 |
Spouse Deduction in respect of a spouse living together in the basis year on condition that the spouse has no source of income/total income or has elected for joint assessment. |
4,000 |
Children See here for more details and additional deductions in relation to children. |
2,000 |
Contribution to EPF Deduction for EPF employee contributions. |
4,000 |
Disabled Person Additional deduction given to a disabled individual. |
6,000 |
Disabled Spouse Additional deduction given to an individual living with a disabled spouse. |
3,500 |
Optional Tax Deductions
Deduction |
Amount limited to (RM) |
Medical Treatment, Special Needs or Carer Expenses of Parents Medical treatment, special needs and carer expenses for parents. Medical expenses which qualify for deductions include:
The parents shall be resident in Malaysia. The medical treatment and care services are provided in Malaysia. In the case of a carer, it shall be proved by a written certification, receipt or copy of carer’s work permit. “Carer” shall not include that individual's husband, wife or child. |
5,000 |
Parental Care Personal deduction given to a resident taxpayer subject to the following conditions:
|
3,000 total (1,500 for each parent) |
Basic Supporting Equipment The purchase of any supporting equipment for one’s own use, if he/she is a disabled person or for the use of his/her spouse, child or parent, who is a disabled person. Basic supporting equipment includes haemodialysis machine, wheelchair, artificial leg and hearing aid but excludes optical lenses and spectacles. |
6,000 |
Higher Education Fees (Self) Deduction for higher education fees for any course of study in an institution or professional body in Malaysia recognized by the Government of Malaysia or approved by the Minister of Finance for the purpose of enhancing any skill or qualification:
|
7,000 |
Medical Expenses on Serious Diseases Medical expenses on serious diseases include the treatment of acquired immune deficiency syndrome (AIDS), Parkinson’s disease, cancer, renal failure, leukaemia and other similar diseases. ‘Other similar diseases’ such as heart attack, pulmonary hypertension, chronic liver disease, fulminant viral hepatitis, head trauma with neurological deficit, brain tumour or vascular malformation, major burns, major organ transplant or major amputation of limbs. Amount expended on own self, husband/wife or child is deductible. |
6,000 |
Complete Medical Examination Amount expended on own self, husband/wife or child for complete medical examination. The total deduction for medical expenses on serious diseases and complete medical examination is limited to a maximum of RM6,000 a year. |
500 |
Net Deposit in Skim Simpanan Pendidikan Nasional (SSPN) Amount deposited in SSPN by an individual for his children’s education. The deduction is limited to the net amount deposited in that basis year only (deposits less withdrawals for the year). |
8,000 |
Payment of Alimony to Former Wife Payment of alimony to a former wife is deductible provided that the total deduction for wife and alimony payment is limited to RM4,000 per year. Voluntary alimony payment to a former wife under a mutual agreement but without any formal agreement does not qualify as a deduction. |
4,000 |
Life Insurance Deduction for life insurance premiums. |
3,000 |
Contribution to a Private Retirement Scheme and Payment of Deferred Annuity Deduction on contribution to Private Retirement Scheme approved by the Securities Commission under The Capital Markets and Services Act 2007 or payment of deferred annuity premium or both. |
3,000 |
Education and Medical Insurance Deduction for insurance premiums in respect of education or medical benefits for an individual, husband, wife or child. |
3,000 |
SOCSO Contribution Deduction for SOCSO employee contributions. |
250 |
Lifestyle Relief Combined tax deduction for reading materials, computers and sports equipment (Includes purchase of newspapers, smartphones and tablets, internet subscriptions & gymnasium membership fees). |
2,500 |
Breastfeeding Deduction for purchase of breastfeeding equipment. |
1,000 (once every 2 years |
Early Education For individual taxpayers who enroll their children aged 6 years and below in registered nurseries & preschools. |
1,000 |
Tax Rebates
Unlike tax deductions which are reductions in your annual chargeable income, tax rebates are further reductions in the amount of tax you pay after you have calculated your tax for the year.
Rebate on Zakat
Zakat can be deducted via payroll, or paid directly by the employee and claimed through the TP1 form.
Rebates for Individuals with Annual Chargeable Income up to RM35,000
A rebate of RM400 is available to individuals with a chargeable income not exceeding RM35,000. Where the spouse does not receive an income or is jointly assessed, a further RM400 rebate can be claimed.
Read more about:
- 2020 tax deductions and rebates here