There are several important dates that tax-paying Malaysians tend to mark on their personal calendar.
These significant milestones include the tabling of the annual budget, which usually happens in October and the deadline for submitting tax return forms, which happens in April to May each year.
Some Malaysians have to file their own taxes, which can be done online with a deadline of April or June each year, depending on whether you run a business or not.
Annually, the government provides tax relief and exemptions to both businesses and individuals. These initiatives are to encourage Malaysians to spend on the economy and thereby help to drive its growth.
Tax Reliefs Under Budget 2024
Malaysia’s Budget 2024 was presented on October 13th 2023, with the theme ‘MADANI Economy: Empowering the People’.
Some of the exemptions are expansions of previous relief initiatives, whilst others are new.
All exemptions here are applicable to expenditures for YA 2024, meaning only on whatever you spend from Jan 1st 2024 to 31st December 2024. These are the more crucial ones to take note oft:
1.Medical Expenses for Yourself, Your Spouse and Your Children
As per previous announcements, Malaysians are entitled for up to RM10,000 medical tax relief. This covers hospitalisation, medical procedures, specialist treatment, surgery, medication and more.
The medical treatment relief has been expanded to include dental treatment, which was not available in previous years. The only conditions are that the dental facility has to be registered with the Malaysian Dental Council and tax returns are capped at RM1000.
Apart from yourself, medical expenses incurred by your children and spouse can also be used to request for tax relief.
2.Knowledge Based Lifestyle Reliefs
The Malaysian government has provided tax relief for certain knowledge-enhancing lifestyle practices. Every tax-payer can claim up to RM2,500 based on purchase receipts. This is where careful receipt documentation becomes crucial.
Among the lifestyle items that you can claim tax reliefs for in 2023 include:
- The purchase and subscription of books, journals, magazines and newspapers, whether online or offline.
- Internet subscription
- Purchase of computers, tablets, laptops and smartphones
3.Personal Education and Upskilling
In this age of the fourth Industrial Revolution (IR4), upskilling is a key step in ensuring that the workforce remains relevant and competitive.
This is why under budget 2024, tax-paying Malaysians can claim up to RM7000 if they’re pursuing their Bachelors, Masters or PhD level degrees.
Additionally, those pursuing any short courses or studies for upskilling and self-enhancement can claim up to RM2000 tax relief.
4.Tax Relief for Dependent Parents
If you have ageing parents, you are allowed to claim up to RM8000 to meet their needs. These claims cover medical treatment, nursing home fees, hiring home care providers, daycare centre fees and more.
This relief has been extended in 2024 to include up to RM1000 tax returns ( out of RM8000 ) for your parent’s full medical checkups, including blood tests and various diagnostic procedures.
5.Special Sports and Recreation Relief
In previous years, this was parked under lifestyle claims together with books and electronics. However, for 2024, you’ll be able to enjoy up to RM1000 tax returns on sporting equipment and activities.
This includes the purchase of any sporting goods, and gym memberships. Additionally, you can also claim for the rental or entry fees to sports venues and facilities.
You can also claim participation fees if you’re planning to register for sporting events like competitions, marathons and the like. If you belong to a sports club or association registered with the Sports Commissioner or Companies Commission of Malaysia, you can also claim for sports training fees.
6.Electronic Vehicle Charging Facilities
We’ve probably heard by now that Tesla is coming into Malaysia in a big way. Malaysians are therefore being encouraged to adopt the electronic vehicles as a lifestyle.
In line with this, the government has announced up to RM2,500 tax returns on the costs of installing EV charging ports, either at your home or commercial premises.
This includes the purchase, subscription or rental of these charging facilities. This exemption is valid all the way until assessment year (YA) 2027.
7. Increased Child Care Relief
Parents of young children will be able to enjoy up to RM3000 tax returns on their children’s childcare and kindergarten fees.
This will no doubt help parents with their cost of living, allowing them more room and flexibility to focus on their children’s education.
8. Family Member Claims
There are several tax relief items that remain unchanged, and you can still take advantage of them in 2024. This includes RM9000 for your own self expenses (with an additional RM 6000 if you’re disabled).
You will also be able to claim up to RM 4000 tax relief for your spouse (with additional RM5000 if he/she is disabled) and up to RM 2000 for each child. Your children pursuing tertiary education will entitle you up to RM8000 in tax claims.
BONUS: Women Returning to the Workforce
There is ample good news for women who want to return to working life after a break from their corporate careers. The government has announced that women can be exempted from income tax for 12 consecutive months anytime from 2025 to 2028.However, certain conditions must be met:
- They have to register with TalentCorp before 31st December 2023
- They must have been unemployed for at least 2 years
The Bottom Line: Get Started Early
Income taxes are usually filed by November each year, and you’ll have to finish your tax return forms online by mid-May the following year.
It's best to keep virtual copies of all your related documents. Having such a collection will ease your form-filling process when the time comes..
If you’re looking for ways to save this coming year, doing your tax returns will definitely help. Alternatively, you can look for cashbacks when you spend, using any of these cashback-rich credit cards. Save on everyday expenses, like groceries, dining, and petrol for a more cost-effective lifestyle...