Tax season in Malaysia can feel overwhelming, especially if you’re not familiar with the latest rules and reliefs available. But what if you could turn tax filing into an opportunity? With a bit of planning and awareness, many individuals can legally maximize their tax refunds or significantly reduce their tax payable. Here’s how.
a) File Your Taxes Early
Don’t wait until the last minute. Filing early gives you time to:
- Gather all necessary documents such as EA form, receipts, donation slips and more.
- Avoid errors or missed deadlines
- Receive your refund faster (if eligible)
b) Maximize Your Tax Reliefs and Rebates
Malaysia offers a wide range of personal tax reliefs under the Income Tax Act 1967. Here are some commonly overlooked ones:
Category | Relief Amount |
Self & dependent | RM9,000 |
EPF contributions | Up to RM4,000 |
Life insurance or takaful | Up to RM3,000 |
Medical expenses for parents | Up to RM8,000 |
Lifestyle expenses (books, gadgets, internet, etc.) | Up to RM2,500 |
SOCSO & EIS | Up to RM350 |
Skim Simpanan Pendidikan Nasional (SSPN) | Up to RM8,000 |
Medical insurance (self, spouse, children) | Up to RM3,000 |
Pro tip: Keep your receipts and statements—LHDN may request proof if you’re audited.
- Claim Relief for Children & Education
You can claim up to RM2,000 per child under 18.
For children studying at tertiary institutions (local or overseas), you may claim up to RM8,000 per child.
If both spouses are working, consider filing separately to maximize combined reliefs.
d) Utilize Voluntary EPF or PRS Contributions
If you’ve maxed out your regular EPF contributions but still want to save tax, consider:
Private Retirement Scheme (PRS) contributions – Relief up to RM3,000
Voluntary EPF top-ups – Useful for freelancers or those not contributing through payroll
e) Claim for Zakat & Donations
Zakat and religious tithes paid to approved religious authorities are fully deductible, reducing your chargeable income. Approved charitable donations to LHDN-registered organizations are also deductible up to 10% of aggregate income.
f) Use e-Filing (and Double Check Before You Submit)
The LHDN e-Filing system (e-Filing ezHASiL) is efficient and user-friendly. Double-check all entries for:
- Employer’s tax number
- EPF & SOCSO figures
- Personal and spouse information
- Bank account for refund (make sure it’s active!)
Resources: https://www.hasil.gov.my/