Pelepasan Cukai 2024/2025: Tax Reliefs Guide for Employers

Every year, when tax season approaches, many employees feel overwhelmed especially when it comes to understanding what they can claim and how to file correctly.

Employers not just to issue EA forms, but also to help the team feel more confident about handling their taxes.

In this article, we’ll walk you through what’s new for Pelepasan Cukai 2024/2025 and how you can support your employees during the upcoming e-Filing period.

Are Employees Liable for Income Tax?

Not every employee in Malaysia must pay income tax. It depends on a few important things:

How much they earn in a year
Whether they are a tax resident or not
What tax reliefs they can claim

For the Year of Assessment 2024 (filing in 2025), employees only need to pay income tax if their total income after EPF deduction is more than RM34,000 per year. This is about RM2,833 per month.

If your income is below this amount, and you qualify for tax reliefs and deductions, you don’t need to pay or file tax.

Even if you earn a bit more than RM34,000, you still might not need to pay any tax if you claim enough personal reliefs.

That’s why it’s important to know what tax deductions are available as it can reduce the amount of tax they need to pay.

Now, let’s also talk about tax residency. It is a factor that affects tax rates and reliefs.

A person is a tax resident if they are in Malaysia for at least 183 days in a year.

Tax residents enjoy lower tax rates and more reliefs.
Non-residents pay a flat 30% tax rate and cannot claim most reliefs.

If you are an employer with foreign workers, make sure you keep good records of:

Work permits
Days worked in Malaysia
Visa and travel information

This helps you apply the correct tax treatment for each employee.

Employment Income That is Not Taxable (Individual)

Not every employee in Malaysia must pay income tax. It depends on a few things, such as:

How much money they earn in a year
Whether they are married or single
If they have children

In general, if someone earns more than RM34,000 per year (after tax deductions), or if their salary already has monthly tax deductions (PCB), they may need to pay income tax.

However, this doesn’t mean all who earn above that are taxable. The LHDN also considers basic tax reliefs and tax rebates to determine final taxability.

Based on these reliefs and rebates, here are the income thresholds for individuals who are NOT required to pay income tax, depending on their assessment type:

Assessment Type	Annual Income (RM)	Monthly Income (RM)
Single / Unmarried / Widowed / Divorced (spouse has no income)	37,333	3,111
Married (Separate Assessment)
With 0 child	37,333	3,111
With 1 child	Not specified	Not specified
With 2 children	41,333	3,444
Married (Joint Assessment)
With 0 child	48,000	4,000
With 1 child	50,000	4,167
With 2 children	52,000	4,333

Notes:

Total individual and dependent relief = RM9,000
Child relief for children under 18 years old = RM2,000 per child
Tax rebate (individual and spouse) is only applicable if the chargeable income is RM35,000 or below

Business Income That is Not Taxable (Individual)

Not all income from business activities is automatically tax-exempt.

In fact, most profits made from doing business, freelance work, or any personal profession are considered taxable by LHDN, even if the business is not officially registered.

This includes what is often called the “informal” or “shadow” economy.

Some common types of business setups include:

Sole proprietorship or self-employed individuals: Those who run their business on their own, such as selling items online or offering freelance services.
Partnerships: Two or more individuals or entities working together and sharing profits. This can be:
- Individual-to-individual
- Between companies
- Individual and company
- With trustees or other business setups

Here are examples of activities considered business income:

Selling products in retail, at night markets, or from stalls
Running an online shop or social media business (e.g. Shopee, Instagram)
Freelance content creation (e.g. blogger, YouTuber, reviewer)
Doing commissioned work (e.g. property agent, insurance agent, reseller)
Giving tuition or public speaking
Performing arts like acting or singing
Providing services (e.g. lawyer, doctor, consultant, coach)
Driving services like e-hailing or taxis
Small-scale farming or livestock businesses

However, certain government incentives or exemptions may apply depending on the type of income. F

or example, income from agriculture or incentives for small traders might be partially exempt under specific LHDN conditions.

If your employees are doing side gigs or freelance work outside their main job, it's good to advise them to declare that income properly.

While their main job income is declared in the EA form, additional income from small businesses still needs to be reported in their e-Filing as part of personal income.

Full List – LHDN Tax Relief for Year of Assessment 2024 (Updated Until 17 Dec 2024)

To make things easier, we’ve included the full official tax relief list released by LHDN.

This list covers every eligible deduction for individuals, from personal reliefs, insurance and EPF contributions, to education, childcare, and even electric vehicle-related expenses.

Bil.	Jenis Potongan Individu	Amaun (RM)
1	Individuals and dependent relatives	9,000
2	Expenses for parents: Medical, dental, special needs and caregiver treatment for parents (Health condition confirmed by medical practitioner) Full medical check-up (Limited to RM1,000)	8,000 (Terhad)
3	Basic support equipment for use by yourself, your spouse, child or disabled parent	6,000 (Terhad)
4	Individuals with disabilities	6,000
5	Tuition Fees (Self): Levels other than Masters or Doctorate – Fields of law, accounting, Islamic finance, technical, vocational, industrial, scientific or technological; Masters or Doctorate – Any field or course of study Skills enhancement or personal development courses (Limited to RM2,000)	7,000 (Terhad)
6	Medical expenses for: Serious illness of self, spouse or childFertility treatment of self or spouse Vaccination of self, spouse or child (Limited to RM1,000) Dental check-up and treatment (Limited to RM1,000)	10,000 (Terhad)
7	Expenses (Limited to RM1,000) for: Full medical examination for self, spouse or child COVID-19 detection test including purchase of self-test kit for self, spouse or child Mental health examination or consultation for self, spouse or child
8	Expenses (Limited to RM4,000) on children aged 18 years and below for: Assessment for the purpose of diagnosis of learning disabilities Early intervention or rehabilitative treatment programmes for learning disabilities
9	Lifestyle – Expenses for personal use / benefit of self, spouse or child for: Purchase or subscription of books / journals / magazines / newspapers / other similar publications (Not prohibited reading material) Purchase of personal computer, smartphone or tablet (Not for business use) Monthly bill payment for internet subscription (In own name) Skills enhancement / personal development course fees	2,500 (Terhad)
10	Lifestyle – additional relief for personal use / benefit, husband / wife or children for: Purchase of sports equipment for sports activities in accordance with the Sports Development Act 1997 Rental fees or entrance fees to sports facilities Registration fees for participating in competitions where the organiser is approved and licensed by the Sports Commissioner under the Sports Development Act 1997Gymnasium / sports training membership fees	1,000 (Terhad)
11	Purchase of breastfeeding equipment for personal use for children aged 2 years and below (Deduction allowed once in every TWO (2) years of assessment)	1,000 (Terhad)
12	Fees for sending children aged 6 years and below to registered childcare centres/kindergartens	3,000 (Terhad)
13	Net savings in the National Education Savings Scheme (SSPN) (Total savings in 2023 minus total withdrawals in 2023)	8,000 (Terhad)
14	Husband / Wife / Alimony payments to ex-wife	4,000 (Terhad)
15	Disabled husband/wife	5,000
16a	Child – Under 18 years of age	2,000
16b	Unmarried children aged 18 years and above and receiving full-time education (A-Level, certificate, matriculation, preparatory or pre-degree level)	2,000
16b	Unmarried children aged 18 years and above are subject to the following conditions: following full-time higher education (excluding matriculation / pre-degree / A-Level courses) at a university, college or similar educational institution in Malaysia; or serving under a bond of articles or indenture to obtain a trade or professional qualification in Malaysia; or following a course at degree level and above at a higher education institution outside Malaysia. the course and higher education institution are recognised by the relevant Government authorities.	8,000
16c	Disabled Children	6,000
16c	Additional relief of RM8,000 for disabled children aged 18 years and above, unmarried and pursuing a diploma or above in Malaysia @ degree level or above outside Malaysia in courses and at IPTs recognized by the relevant Government authorities.	8,000
17	Life insurance and EPF Categories of civil servants on pensionable schemes, other than civil servants on pensionable schemes and self-employed: Compulsory contributions to approved schemes or voluntary contributions to EPF (excluding private retirement schemes) or contributions under any written law (Limited to RM4,000) Payment of life insurance premiums or family takaful contributions or additional voluntary contributions to EPF (Limited to RM3,000)	7,000 (Terhad)
18	Private Retirement Schemes and Deferred Annuities	3,000 (Terhad)
19	Education and medical insurance	3,000 (Terhad)
20	Contributions to the Social Security Organization (SOCSO) in accordance with the Employees' Social Security Act 1969 or the Employment Insurance System Act 2017	350 (Terhad)
21	Expenses for installation, rental, purchase including hire-purchase of equipment or subscription for the use of electric vehicle charging facilities for own vehicles (Not for business use)	2,500 (Terhad)

Source: facebook.com/LHDN

To make it easier for your team to understand the full scope of income tax reliefs for YA 2024, we’ve included a reference to the official document issued by LHDN: Nota Penerangan BE 2024.

This PDF contains a complete breakdown of all tax relief categories, including:

Individual and dependent relief
EPF, SOCSO, and insurance contributions
Education, medical, and lifestyle claims
Child-related claims, including special needs
Retirement incentives and donation-based deductions
Official tax codes, income thresholds, and examples of how to fill the BE form correctly

You can use this document to check all the latest limits and conditions based on the final update from LHDN as of 17 December 2024.

It also includes useful tables, walkthroughs, and examples that help both employers and employees navigate the e-Filing process.

What Employers Should Do if Employees Are Liable for Tax?

Once your employees meet the minimum income threshold for tax, they become responsible for declaring and paying income tax through LHDN’s e-Filing system.

While this is a personal responsibility, employers play an important supporting role, especially in helping employees stay compliant and reduce unnecessary stress.

Here are some key actions employers should take:

1. Provide EA Forms Accurately and On Time

The EA Form is the main reference for employees when filing their taxes.

It includes their total income, benefits, EPF contributions, and PCB (Potongan Cukai Berjadual). So, make sure to:

Prepare and distribute EA Forms before the 29th of February every year.
Double-check figures to prevent misreporting.
Highlight any non-taxable income so employees don’t mistakenly declare them.

2. Guide Employees on e-Filing Deadlines and Tools

New employees or fresh graduates may be unfamiliar with e-Filing or tax relief claims. HR teams can support them by:

Sharing LHDN’s e-Filing guides or FAQ links.
Hosting a short internal webinar or info session before filing season.
Reminding them of the e-Filing deadline (usually 30 April) for individual tax.

3. Encourage Receipt Tracking and Supporting Documents

To enjoy tax reliefs, employees must keep receipts as proof of eligible expenses. You can help them by:

Providing a template or checklist to help staff track their yearly claims.
Offering optional access to cloud storage folders or expense tracking apps.
Organising a shared folder for common FAQs or examples of what’s claimable.

4. Promote Tax Awareness as Part of HR Support

It’s helpful to normalise tax education in the workplace. This can be done casually during onboarding, payroll updates, or company newsletters.

When employees are more aware of their tax rights and responsibilities, they are:

Less likely to miss deadlines.
More confident managing their finances.
More appreciative of employer support.

Further Information on Tax Relief 2024 & e-Filing 2025

As tax season approaches, employees may need help finding reliable information about their eligibility, tax relief claims, or the e-Filing process.

While employers are not required to give financial advice, it’s helpful to direct employees to official sources and internal references to reduce confusion.

Share LHDN’s Official Resources

Employees can visit the Lembaga Hasil Dalam Negeri (LHDN) official portals for up-to-date information:

These websites offer:

Full tax relief lists for Year of Assessment 2024.
e-Filing submission links.
Step-by-step guides and downloadable documents.

If employees require direct assistance, they can contact Hasil Care Line:

General Inquiries:

03-8911 1000
(From overseas) 603-8911 1100

Quick Access Numbers by Topic:

Employment Income (no business): 03-8911 1200
Business Income / Freelancing: 03-8911 1300
e-Filing technical help: 03-8911 1400
Government aid & BKM: 1800-88-2747

Provide HR Touchpoints or Policy Documents

Even if HR cannot provide individual tax calculations, they can still be a helpful guide during tax season. Here are a few things HR teams can prepare internally:

A simple Google Doc or PDF guide on how to read the EA Form.
Lists of receipts needed for common tax reliefs (e.g. EPF, medical bills, education).
Quick videos or internal FAQs about e-Filing basics.
Links to official LHDN resources embedded in staff newsletters or internal chats.

Offer Help Channels

To make things easier for employees:

Designate an HR contact (email or WhatsApp) to handle tax-related document queries.
Organise a “Tax Help Day” where employees can ask general questions.
Send reminders via company channels a few weeks before the April deadline.

FAQ

What is the tax relief limit for 2024?

The total amount of tax relief a person can claim depends on their situation, whether they have children, pay for insurance, contribute to EPF, or have medical expenses. For most individuals, the total claimable tax reliefs can go over RM30,000 if they meet all the eligible categories. You can refer to LHDN’s official tax relief list for detailed limits and codes.

Can part-time employees qualify for tax reliefs?

Yes, as long as part-time employees earn enough to be taxable and submit their e-Filing, they are eligible to claim tax reliefs. This includes lifestyle purchases, EPF or SOCSO contributions (if applicable), and medical expenses. Encourage part-time team members to check their annual income and claim if they meet the threshold.

Is EPF contribution tax-deductible?

Yes. Employee contributions to EPF are deductible under the EPF + Life Insurance combined relief, capped at RM7,000 per year. This helps reduce chargeable income and lowers the final tax amount. Keep in mind this cap includes both EPF and life insurance payments combined.

How can employers help staff with tax awareness?

Employers can support tax awareness in simple but effective ways:

Provide EA forms early, ideally before March.
Share LHDN links and tax calendar reminders.
Organise quick sessions or email explainers about popular tax reliefs.
Highlight important reliefs like childcare, lifestyle, medical, and EPF in staff communications.

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