“Tune” your budget for personal YA 2020 tax

The 2021 Budget has been the talk among Malaysians lately. But, as the year is ending, there are few things to “adjust” your 2020 budget for income tax relief filing next year.

If you are earning more than RM34,000 a year (or RM2,834 a month) after EPF deductions, you have to register a tax file.

By knowing the tax reliefs and deductions, you may get a tax refund by doing the necessary. 

Lifestyle/Personal

1. A tax relief of up to RM1,000 for domestic travel expenses from March 1 until Dec 31.
2. A special tax relief of up to RM2,500 is available for the purchase of a handphone, notebook or tablet from June 1 to Dec 31, 2020
3. Books, newspapers, personal computer, smartphone or tablet, sports equipment, gym membership and internet subscription up to RM2,500. 
4. Tertiary level education (Masters or Doctorate level) is RM7,000

Family with children

1. Tax relief is increased to RM3,000 to resident who enroll their children aged up to six-year old in child-care centres 
2. Breastfeeding equipment RM1,000
3. Deposit for child into the SSPN account up to RM8,000
4. Child below 18-year-old is RM2,000 while above 18 studying at diploma or degree level is RM8,000
5. Child below 18-year-old with physically or mentally challenged is RM6,000 while above 18 and receiving full time education is RM14,000. 

Savings/ Insurance

1. Life insurance RM3,000
2. Education or medical insurance RM3,000
3. Social Security RM250
4. EPF contributions RM4,000
5. Private Retirement Scheme contribution RM3,000

Medical expenses

1. Self, spouse, or child suffering from 
2. a serious disease or personal medical checkup, or infertility treatment up to RM6,000
3. (For disable person) Purchase of supporting equipment for self, disabled spouse, child or parent up to RM6,000

Parental cares

1. Father and mother, RM1,500 each
2. Expenses on medical treatment, special needs or carer for parents RM5,000

Additional for tax deductions. 

The LHDN does not limit the amount of donation to qualify for tax deductions. It is very important for you to get an official tax exemption receipt from the organisations recognised under LHDN. 

The receipt has to have your name, identity card and complete mailing address.

The list of approved organisations can be found here