MARCH 1 ― It is the time of the year to get ready to file your personal tax return for the year of assessment (YA) 2021, in relation to income derived from Malaysia during the calendar year 2021.
The respective filing due dates for individual taxpayers are as follows:
How to minimize my taxes ― you may be wondering. The answer is to maximize the claim for personal tax relief to the extent possible. One thing to note though is that such reliefs are only available for resident individual taxpayers.
In addition to the usual reliefs that you may be familiar with, there are a few new reliefs made available under the various Covid-19 stimulus packages. Further, some existing reliefs have been enhanced/extended as announced in the 2022 budget. The key tax reliefs are summarized below.
1. Purchase of smartphone, personal computer or tablet
In addition to the lifestyle relief of RM2,500, a “special” tax relief is given for the purchase of smartphone, personal computer or tablet for own use, or for the use of spouse or child (not being used for own business). This relief is extended to purchases made on or after December 31, 2020, but not later than December 31, 2022.
Therefore, you could claim a maximum of RM5,000 for YA2021 under the lifestyle and special reliefs if you had incurred the following purchases during the calendar year 2021:
• reading materials including subscription for electronic newspapers
• sports equipment
• computer, smartphone or tablet
• internet subscription
• high school membership fee
The claim must be supported by the official receipt. It is important to check the date of the receipt to ensure the purchase was made during the period from January 1, 2021 to December 31, 2021 in order to qualify for the claim.
2. Tax relief on medical expenses for serious diseases
Presently, a relief of up to RM8,000 for medical expenses incurred for the treatment of serious diseases (for self, spouse and child) and fertility treatment (for self and spouse) includes a relief of up to RM1,000 for full medical check -up and RM1,000 for cost of vaccination expenses for pneumococcal human papillomavirus (HPV), influenza, rotavirus, varicella, meningococcal, TDAP and Covid-19.
For YA2021, the RM1,000 relief is expanded to include Covid-19 detection test (as evidenced by receipts issued by a hospital or a medical practitioner registered with the Malaysian Medical Council) as well as for the purchase Covid-19 self-detection test kits (as supported by receipts).
3. Domestic tourism expenditure
A relief up to RM1,000 is given for the following domestic tourism expenditure:
a) Payment of accommodation at the premises registered under the Tourism Industry Act 1992; or
b) Payment of entrance fee to a tourist attraction.
Official receipt must be available to support the claim and ensure that the expenses were indeed incurred from January 1, 2021 to December 31, 2021.
4. Medical expenses for parents
General view of the Inland Revenue Board of Malaysia building located at Jalan Duta in Kuala Lumpur April 23, 2020. — Picture by Hari Anggara
Up to YA2020, medical expenses of RM5,000 (maximum) were allowed to be claimed in respect of medical treatment, special needs or carer expenses incurred for parents, subject to the relevant certification by a registered medical practitioner. The good news is that the maximum amount has been increased to RM8,000 for YA2021.
One point to note is that this relief and the parental care tax relief of RM1,500 are mutually exclusive, which means you are not entitled to claim both in your tax return.
For the complete list of the tax reliefs and rebates available, you can visit the IRB website at https://www.hasil.gov.my/index.php.
* Leonard Yap, is a Managing Consultant of Tricor Taxand Sdn Bhd, an entity within the Tricor Group. The Tricor Group operates in 21 countries/territories and across a network of 47 offices.
** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.