The Inland Revenue Board (LHDN) has announced the non-taxable income thresholds for individuals for the 2025 assessment year. These thresholds indicate the income levels below which individuals are not required to pay personal income tax, based on filing status and family composition.

Knowing these thresholds can help individuals better understand whether their income is likely to be subject to tax and plan their finances accordingly.

Non-Taxable Income Levels Under Separate Assessment

For individuals filing under separate assessment, the non-taxable income threshold for a single person is RM37,333 per year, which works out to about RM3,111 per month.

For married individuals with one child under separate assessment, the threshold rises to RM39,333 annually, or approximately RM3,278 per month. Those with two children under separate assessment have a higher threshold of RM41,333 per year, equivalent to about RM3,444 per month.

These income levels reflect basic personal reliefs and are intended to reduce the tax burden on lower- and middle-income earners.

Higher Thresholds Apply Under Joint Assessment

Married couples who choose joint assessment benefit from higher non-taxable income thresholds.

For married couples without children, the threshold is RM48,000 per year, or RM4,000 per month. With one child, the non-taxable income level increases to RM50,000 annually, which is roughly RM4,167 per month. Married couples with two children under joint assessment have a threshold of RM52,000 per year, or about RM4,333 per month.

The choice between separate and joint assessment can affect how much tax a household ultimately pays, depending on how income is shared between spouses.

Tax Rebate Eligibility For Lower-Income Earners

LHDN also confirmed that individuals with chargeable income not exceeding RM35,000 are eligible for tax rebates.

Under separate or single assessment, eligible taxpayers are entitled to a self rebate of RM400. For those opting for joint assessment, the rebate includes RM400 for the individual and an additional RM400 for the spouse, subject to eligibility conditions.

These rebates directly reduce tax payable and can help ease the financial burden for lower-income households.

How The 2025 Thresholds Affect Your Tax Position

The updated non-taxable income thresholds provide a clearer benchmark for taxpayers assessing their potential tax liability in 2025. Individuals earning close to these limits may benefit from reviewing available tax reliefs and deductions to stay within the non-taxable range.

For married couples, understanding the differences between separate and joint assessment can support better decisions on how income is declared. Changes in income or family circumstances may also affect which option is more suitable for the year ahead.

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