Released January 2021
Compliance updates
Personal income tax rate update
Tax calculations have been updated in line with the budget that was tabled. These rates come into effect from 1st January 2021.
- The tax rate for resident individuals with chargeable income in the band of RM50,001 to RM70,000
is reduced to 13%. See below for the updated tax rebate amount:
| P (RM) | M | R | B Category 1 & 3 |
B Category 2 |
|---|---|---|---|---|
| 5,001 to 20,000 | 5,000 | 1 | -400 | -800 |
| 20,001 to 35,000 | 20,000 | 3 | -250 | -650 |
| 35,001 to 50,000 | 35,000 | 8 | 600 | 600 |
| 50,001 to 70,000 | 50,000 | 13 | 1,800 | 1,800 |
| 70,001 to 100,000 | 70,000 | 21 | 4,400 | 4,400 |
| 100,001 to 250,000 | 100,000 | 24 | 10,700 | 10,700 |
| 250,001 to 400,000 | 250,000 | 24.5 | 46,700 | 46,700 |
| 400,001 to 600,000 | 400,000 | 25 | 83,450 | 83,450 |
| 600,001 to 1,000,000 | 600,000 | 26 | 133,450 | 133,450 |
| 1,000,001 to 2,000,000 | 1,000,000 | 28 | 237,450 | 237,450 |
| Above 2,000,000 | 2,000,000 | 30 | 517,450 | 517,450 |
Key:
P
Total chargeable income for a year
M
Amount of the first chargeable income for every range of chargeable income a year
R
Percentage of tax rates
B
Amount of tax on M after deduction of tax rebate for individual and husband or wife, if qualified
Personal Income Tax Relief Updates for Year of Assessment(“YA”)2021
- increased tax relief limit for a disabled spouse to RM5,000. (Previously RM3,500)
- tax relief limit for medical treatment, special needs, and carer expenses for parents increased to
RM8,000.) - new tax relief for vaccination expenses (limit to RM 1,000) has been introduced that constitutes part
of existing medical expenses for self, spouse, and child, and the total relief increased to RM8,000) - tax relief limit for education expenses now covers up-skilling and self-enhancement courses
(limit to RM 1,000) that constitutes part of the existing tax relief of RM7,000) - tax relief limit for lifestyle limited to RM3,000, where the additional RM500 is specifically for
expenditure related to sports, including subscription of electronic newspapers) - tax relief limit on childcare services expenses increased from. RM2,000 to RM3,000 (w.e.f. 2020)
- new tax relief for domestic tourism expenses with limit RM 1,000 has been added (w.e.f. 1 Mar 2020)
The Allowable Optional Deductions and Rebates windows has been updated as follows:
Tax information – Y/A 2020
Tax information – Y/A 2021
The relevant forms have been updated as follows:
Form TP1 – Borang Tuntutan Potongan Dan Rebat Individu
Form TP1 Page 1
Form TP1 Page 2
Form TP1 Page 3