5 Common Tax Reliefs Malaysians Often Overlook in 2025
As the 2025 Year of Assessment progresses, young Malaysian professionals should pay close attention to several updated tax incentives. While the standard RM9,000 individual relief is applied automatically, many taxpayers miss out on thousands in savings because they are unaware of specific changes and extensions in the latest budget. Utilizing these reliefs effectively is a key step toward financial mastery.
1. Expanded Medical Relief for Parents and Grandparents
The relief for parental medical expenses is capped at RM8,000, but for the 2025 assessment year, the scope has become much broader. It now includes medical treatment, dental care, and special care for grandparents as well. Furthermore, you can now include costs for full medical examinations and vaccinations (limited to RM1,000 within this category) for your elders. This update reflects the government’s move to support the "sandwich generation" caring for multiple age groups.
2. Higher Limits for Education and Medical Insurance
Medical costs are rising, and the 2025 tax structure reflects this. The relief for education and medical insurance premiums has been increased to RM4,000 from the previous RM3,000 limit. If you have been paying for a private medical card or an education policy for your children, this RM1,000 increase provides a significant opportunity to lower your taxable income.
3. Lifestyle and the New Sports Scope
The core lifestyle relief remains at RM2,500 for smartphones, tablets, books, and home internet subscriptions. However, the additional RM1,000 specifically for sports equipment and activities now includes expenses incurred for your parents. Buying a pair of high-quality walking shoes for your mother or paying for your father’s gym membership is now a valid way to maximize this deduction.
4. Extended SSPN Savings Relief
The RM8,000 tax relief for net savings in the National Education Savings Scheme (SSPN) has been extended until 2027. For 2025, it is important to track your "net" deposits. This means any withdrawals you make during the year will be deducted from your total deposits when calculating your final claimable amount.
5. Private Retirement Scheme (PRS) Extension
The RM3,000 relief for PRS contributions is now extended until 2030. This remains a favorite for young professionals because it simultaneously builds a long-term retirement fund while providing an immediate reduction in tax liability.
Always ensure you store your digital or physical receipts for seven years. This habit is essential for surviving a potential audit by the Inland Revenue Board (LHDN).