Great news! Budget 2025 has some exciting benefits for individuals.
Here’s a quick rundown:
Education and Medical Insurance Relief: The income tax relief on premiums paid for education and medical insurance will be increased from RM3,000 to RM4,000 per year effective from YA 2025.
Nursery & Kindergarten Fees Relief: The income tax relief for nursery or kindergarten fees of up to RM3,000 will be extended for a period of three (3) years from YA 2025 to YA 2027.
Skim Simpanan Pendidikan Nasional Relief: The Skim Simpanan Pendidikan Nasional (SSPN) tax relief up to RM8,000 will be extended until year of assessment 2027.
Expenses For The Purchase Of Domestic Food Waste Composting Machine Relief: Tax relief up to RM2,500 for electric vehicle (EV) charging facility will be expanded to include purchase of food waste composting machines for household use from year of assessment 2025 until 2027.
Private Retirement Scheme Relief: The income tax relief of up to RM3,000 for contributions to PRS and premiums paid for deferred annuities will be extended for five (5) years until year of assessment 2030.
2% Dividend Tax on Individual Shareholders: Annual dividends income exceeding RM100,000 will subject to a 2% dividend tax starting from year of assessment 2025.
Tax Exemption On The Victory Prize Scheme Sports: Income tax exemption is given on sports winning cash prizes received by individual and team athletes through the Victory Prize Scheme Sports provided by the government via the National Sports Council.
Disabled Individual Relief that will be effective from YA 2025.
- Relief for a disabled individual: increased from RM6,000 to RM7,000.
- Relief for a disabled spouse: increased from RM5,000 to RM6,000.
- Relief for an unmarried disabled child: increased from RM6,000 to RM8,000.
Foreign Sources Income by Individuals: Exemption on foreign source income (FSI) received by individuals in Malaysia will be extended until 31 December 2036.
Housing Loan Interest Relief: The income tax relief on the interest payments for the first residential home loan (individually or jointly owned), is as follows:
Sales and purchase agreement from 1 January 2025 until 31 December 2027, terms and conditions applied.
Sport Activities, Health and Elderly Care Relief starting from year of assessment 2025:
- Individual Income Tax Relief
- Sports equipment & activities limited to RM1,000 will be expanded to include parents.
- Full medical check-up expenses for parents, limited to RM1,000 will be expanded to include vaccination.
- Medical treatment, special needs and parental care expenses will be expanded to include grandparents.
- Individual Income Tax Exemption
- Income tax exemption of up to RM3,000 per year given on childcare allowance received by employees or paid directly by employers to childcare centers will be expanded to include elderly care (parent/grandparents).
Medical Expenses Relief starting from year of assessment 2025
- Tax relief for medical treatment for taxpayer, spouse and child will be expanded to cover expenses for purchase of self-testing medical devices and fees for disease detection examination conducted at clinic or hospital limited to RM1,000.
- Tax relief for assessment and diagnosis, early intervention programme and continuous rehabilitation treatment for children aged below 18 will be increased to RM6,000.
- Tax relief for medical expenses of up to RM10,000 will be expanded to include portion of medical payments made by taxpayers under medical and health insurance and takaful products with co-payment features.
For more information
Boost Your Health, Save on Taxes, download the pdf version here. If you have any questions, feel free to contact us at +604 3059600, or enquiry@mywave.biz.
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