Which benefits-in-kind are tax exempt?

Benefits-in-kind are benefits provided by or on behalf of your employer that cannot be converted into money. These benefits are normally part of your taxable income, except for tax exempt benefits which will not be part of your taxable income.

Tax exemption applies to the benefits-in-kind listed below, unless you have control over your employer (for more information, please read here).


Benefit

Details

Dental benefit

Tax exempt

Childcare benefit

Childcare provided by employers, e.g. a childcare center, is tax exempt

Food and drink provided free of charge

Tax exempt

Free transportation between pickup points or home and the place of work (to and from)

Tax exempt

Obligatory insurance premiums for foreign workers

Tax exempt

Group insurance premium to cover workers in the event of an accident

Tax exempt

Leave passage

Tax exempt for travel:

in Malaysia (not more than three times a year); or

overseas (not more than once a year) with tax exemption limit of RM3,000

provided to employee and immediate family only.


Benefits used by employer to perform his employment duties

Tax exempt

Discounts on goods and services provided by the employer

Tax exempt provided that they are:

not convertible into money by the employee even though they have money's worth;

for the benefit of the employee and are used by the employee personally; and

provided to employees as a whole and not provided specifically to a certain group of employees only.

Note: discounts on goods are only tax exempt up to a value of RM1,000.

Benefits and monthly bills for fixed line telephones, mobile phones, pagers, PDAs and broadband

The amount to be exempted includes registration cost and installation cost. The exemption given is limited to one unit for each class of assets.

Benefits for medical treatment

Tax exempt for modern medicine, traditional medicine and maternity. Treatment must be by certified medical doctors or medical practitioners registered with government-approved bodies.

Petrol benefits

Exemption up to RM6,000 for petrol used for official duty (this limit also applies to any petrol allowance/travel allowance/toll payment). Amounts above RM6,000 may be claimed if records are kept for 7 years.







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