How Tax Reliefs Work in Malaysia
Tax reliefs reduce your chargeable income — the amount on which income tax is calculated. They are not direct reductions in your tax bill; they reduce the income you are taxed on. Because Malaysia uses a progressive tax rate, the tax saving from a relief depends on which bracket it falls in.
Example: If you are in the 24% tax bracket and claim a RM3,000 PRS relief, your tax saving is RM3,000 × 24% = RM720 less tax to pay.
Zakat is the notable exception — it is a direct 1:1 rebate against your final tax payable, not just a chargeable income reduction.
Complete YA 2024 Tax Relief Reference
Retirement & Savings
| Relief | Maximum | Notes |
|---|---|---|
| EPF / mandatory pension contributions | RM 4,000 | Includes both mandatory (11%) and voluntary top-ups |
| Private Retirement Scheme (PRS) | RM 3,000 | Separate from EPF relief. Invest in SC-approved PRS funds. |
| SSPN savings for children (Skim Simpanan Pendidikan Nasional) | RM 8,000 | Net deposits only (deposits minus withdrawals in the year) |
Insurance
| Relief | Maximum | Notes |
|---|---|---|
| Life insurance premiums | RM 3,000 | Includes takaful contributions. Combined with EPF to RM7,000 total. |
| Medical and education insurance | RM 3,000 | Private medical card, hospitalisation, critical illness coverage |
| SOCSO contributions | RM 350 | Employee SOCSO contribution (auto-deducted; include in return) |
Medical & Health
| Relief | Maximum | Notes |
|---|---|---|
| Medical expenses (self, spouse, children) | RM 10,000 | Serious diseases: cancer, kidney dialysis, heart disease, etc. |
| Complete medical examination | RM 1,000 | Health screening. Absorbed within the RM10,000 cap. |
| Mental health examination and treatment | RM 1,000 | Added from YA 2022. Psychiatry, clinical psychology. |
| Fertility treatment (self and spouse) | RM 10,000 | Within the broader medical relief cap |
| Vaccination (self, spouse, children) | RM 1,000 | Added from YA 2022 |
Education
| Relief | Maximum | Notes |
|---|---|---|
| Education fees (self) | RM 7,000 | Undergraduate or postgraduate at recognised institutions. Skills / vocational training also eligible. |
Lifestyle
| Relief | Maximum | Notes |
|---|---|---|
| Lifestyle relief (books, devices, sports, internet, gym) | RM 2,500 | Keep all receipts. Smartphones and computers included. |
| Sports equipment and gym membership | RM 500 | Sub-limit within the lifestyle relief |
| Electric vehicle (EV) charging equipment | RM 2,500 | Added from YA 2024 |
Family
| Relief | Maximum | Notes |
|---|---|---|
| Spouse (no income / income below RM4,000) | RM 4,000 | Cannot be claimed if spouse already claims own reliefs |
| Child relief (each child under 18) | RM 2,000 each | Or over 18 in full-time education |
| Child in higher education | RM 8,000 each | Diploma and above at local or approved foreign institutions |
| Disabled child | RM 6,000 each | Additional RM8,000 if pursuing higher education |
Donations & Zakat
| Relief | Maximum | Notes |
|---|---|---|
| Cash donations to approved charities | 10% of aggregate income | Only LHDN-approved charities qualify (Section 44(6)) |
| Zakat (income zakat / zakat harta) | Actual amount | Full rebate against tax payable (1:1 reduction, not just relief) |
4 High-Impact Strategies Most Malaysians Miss
- PRS contribution. The RM3,000 PRS relief is completely separate from your EPF relief. A person in the 24% bracket saves RM720 in tax just by contributing RM3,000 to a PRS fund. The money is locked until retirement, but it grows tax-free and you can claim the relief every year.
- Medical card upgrade. Private medical and education insurance has a separate RM3,000 cap from life insurance. If you only have a company group medical card, consider a personal medical card — the premium may qualify for this relief.
- Upskilling. Education expenses for skills or vocational training (not just degree-level) at registered institutions qualify for the RM7,000 education relief. Many professional certifications (accounting, HR, data science) qualify.
- SSPN deposits. If you have children, depositing into SSPN (Skim Simpanan Pendidikan Nasional) gives RM8,000 relief per year (net of withdrawals). SSPN also earns competitive dividends. This relief is underused because many parents are unaware of it.
Submit a TP1 to Get the Benefit Monthly
Most of these reliefs are claimed in your annual tax return (Borang BE), filed March–April the following year. But you can get the cash benefit immediately by declaring your reliefs to your employer via a TP1 form. This reduces your monthly PCB deduction — you keep more cash each month rather than waiting for a year-end refund.
Calculate Your Tax After Reliefs
Enter your income and reliefs to see your chargeable income, LHDN tax payable, and effective tax rate for YA 2024.
Related Guides
- PCB vs Income Tax Malaysia — how monthly deductions relate to annual filing
- How PCB Tax Works in Malaysia
- Income Tax Calculator Malaysia
- PCB Calculator Malaysia