How Much Can You Benefit from Tax Reliefs On Your Children’s Education?
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With only one month left until we welcome the new year – it also means that you would have until the end of December to maximise your tax reliefs for this year of assessment (YA) before the routine tax filing comes in April 2021. Especially for parents, since it can help you plan your finances better and your children’s future education considering that the cost of education is rising faster than inflation.

Even more so with Covid-19 still lingering around during these unprecedented times, maximising what you can claim for tax reliefs will help lift some of the financial challenges off your shoulders. If you would like to know overall what can you claim for tax relief, you can read more here. But specifically for your children’s education and childcare-related tax reliefs, read on to know what you can claim to allow you to enjoy a lower tax rate and ultimately pay less in tax.

  • Books or Reading Materials for Your Children
    Claim up to RM2,500 (collectively under Lifestyle Purchases)
    While this does not specifically fall under the education category, parents can claim tax relief for reading materials that you have purchased for your children, together with your other lifestyle purchases such as gadgets and electronics, sports equipment, and internet subscriptions.

  • Education Insurance
    Claim up to RM3,000 (collectively with Medical Insurance)
    A little less heard type of insurance is the Education Insurance which usually comes in two forms – an endowment policy which resembles a savings account but with insurance benefits, and an investment-linked policy which lets you invest while providing you with specific coverage. If you would like to know more about Education Insurance, you can read more here.
  • Childcare Fees for Children Aged 6 Years and Below
    Claim up to RM1,000
    With the rising cost of childcare services in Malaysia, parents can benefit from this tax relief, provided that the childcare centre or kindergarten you are sending your children to is legally registered. This relief is claimable for parents with more than one child of eligible age, but do note that the maximum claim for this relief is capped at RM1,000 per individual.
  • Ordinary Child Relief for Children Aged Below 18 Years
    Claim up to RM2,000 per child

  • Full-Time Education for Children Aged 18 Years and Above
    Claim RM2,000 for education levels similar to A-levels, RM8,000 for tertiary education
    If you have a child aged 18 years and above who is unmarried and receiving full-time education in a course equivalent to A-levels, you can claim RM2,000 in relief.

    However, if your child is taking a tertiary education course, you can claim RM8,000. The tax relief is applicable to each child, so if you have more than one child in different levels of education you can make multiple claims.

    Education levels similar to A-level here include matriculation, pre-degree, or foundation studies while tertiary education refers to the pursuit of a full-time degree including Masters or Doctorate in and outside Malaysia.

  • Net Deposit in SSPN
    Claim up to RM8,000 per individual
    Skim Simpanan Pendidikan Nasional (SSPN) or the National Education Savings Scheme is a savings plan introduced by PTPTN that offers annual competitive dividend payout of up to 4%, as of 2019.

    Currently available in two types of accounts – SSPN-i and SSPN-i Plus, PTPTN makes it easier for parents to start saving for their children’s future education from as low as RM20 for SSPN-i, and RM30 for SSPN-i Plus Intan Package.

    Besides enjoying the annual dividend, parents can also benefit from the tax relief of up to RM8,000 based on net deposit that you have in the SSPN-i or SSPN-i Plus account that you have opened for your children in the assessment year.

So, How Do SSPN-i And SSPN-i Plus Accounts Work?

SSPN-i SSPN-i Plus
●      Minimum opening deposit of RM20, with no monthly commitment

●      Tax relief of up to RM8,000 per year based on net deposit of that year


●      Similar to regular SSPN-i account, but with Takaful coverage

●      Minimum two months opening deposit, according to selected package with monthly commitment of:

❖    Intan – RM30

❖    Delima – RM50

❖    Topas – RM100

❖    Nilam – RM200

❖    Zamrud – RM300

❖    Berlian – RM500

●      Tax relief of up to RM8,000 per year based on net deposit of that year

●      Additional tax relief up to RM3,000 for Takaful contributions for non-government servant


Additional tax relief up to RM7,000 for Takaful contributions for government servant who opted for pension scheme

So there you have it – childcare-related tax reliefs that you can claim for the remainder of this year. You can also keep them in mind for the next coming YA to help you maximise them. Hopefully this will help you plan your finances better, while keeping the savings for your children’s education in check.

Meanwhile, for parents who have yet to start saving for your children’s education with SSPN, you may sign up for an SSPN-i or SSPN-i Plus here to start enjoying the many benefits of savings with SSPN. Hear it from these parents themselves who have been saving in SSPN for their children’s education on how SSPN and its tax relief has benefited them in their personal financial planning.

Lee Shaw Feng, 49, father of 2
“I have been saving in SSPN for both my children for more than 10 years. Saving money for my children’s education in SSPN benefits not just my children, but also myself as a parent when it comes to tax relief. Saving with SSPN also helps me to be disciplined in saving for my children’s future education.”

Muhammad Ridzuan, 31, father of 1
“The savings dividend with SSPN is quite competitive at an average of 4% every year. SSPN also offers attractive prizes for contest draws. Besides that, I get to enjoy tax relief benefits up to RM8,000 with our savings guaranteed by the government.
By saving with SSPN for my child’s education, I can reduce my loan dependency in the future, while allowing me to be able to deposit more money into the SSPN account and enjoy my tax relief benefit.”

Plus, if you open an SSPN-i Plus account now for your children, you would also get the chance to participate in Cabutan WOW! SSPN-i Plus 2020!

Open to both new and existing SSPN-i Plus depositors, you can stand a chance to win prizes worth up to RM1 million, including a luxury Mercedes Benz C200 and cash prizes just by depositing a minimum amount of RM50. The campaign ends 31 December 2020, so hurry, don’t miss out!

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