Updated April 2026 • YA 2025 • EPF / KWSP Relief

EPF Tax Relief Malaysia 2026 — RM 4,000 Cap, i-Saraan, PRS & How to Claim (YA 2025)

EPF (KWSP) income tax relief for YA 2025: RM 4,000 employee contribution cap, who qualifies, what salary hits the cap, i-Saraan for self-employed, PRS vs EPF difference, and step-by-step how to verify and claim in e-Filing Form BE.

EPF Tax Relief — Quick Facts (YA 2025)

Maximum relief: RM 4,000 (employee contribution only — employer's share does NOT qualify)

Salary threshold to hit RM 4,000: ≈ RM 3,704/month gross (at 9% contribution rate)

Self-employed: Eligible via i-Saraan voluntary contributions

PRS: Separate RM 3,000 relief — not combined with EPF

Tax saving at 24% bracket: RM 960 (full RM 4,000 relief)

What Is the EPF Tax Relief?

Under Section 46(1)(f) of the Income Tax Act 1967, Malaysian resident individuals can deduct their EPF (KWSP — Kumpulan Wang Simpanan Pekerja) contributions from their chargeable income, up to a maximum of RM 4,000 per year.

The EPF tax relief applies to your employee contribution only. Your employer also contributes to your EPF account (13% for salary ≤ RM 5,000/month; 12% for salary > RM 5,000/month), but that employer portion is not a personal tax deduction — it belongs to the company's costs.

At a tax rate of 24%, the full RM 4,000 EPF relief saves you RM 960 in tax. At 19%, it saves RM 760. At 13%, it saves RM 520. This is one of the most universally applicable reliefs — virtually every Malaysian employee with a formal job claims it automatically through e-Filing's pre-fill system.

How Much Can You Actually Claim? (Salary Scenarios)

The RM 4,000 is a cap, not a guaranteed amount. You can only claim what you actually contributed as an employee. If your annual employee EPF contributions total less than RM 4,000, you claim the actual amount.

At the standard 9% employee contribution rate, you hit the RM 4,000 cap when your monthly gross salary reaches approximately RM 3,704.

Monthly Gross Salary	Annual Employee EPF (9%)	Relief Claimable	Tax Saving (19% bracket)
RM 2,000	RM 2,160	RM 2,160 (actual)	RM 410
RM 3,000	RM 3,240	RM 3,240 (actual)	RM 616
RM 3,704 (threshold)	RM 4,000	RM 4,000 (cap reached)	RM 760
RM 5,000	RM 5,400	RM 4,000 (capped)	RM 760
RM 10,000	RM 10,800	RM 4,000 (capped)	RM 760

Common Mistake: Claiming RM 4,000 When You Contributed Less If your monthly salary was below RM 3,704 for part or all of YA 2025, your actual employee EPF contributions may be less than RM 4,000. LHDN's pre-fill usually populates the correct amount — but always verify against your Form EA Section F (Statutory EPF Deduction) and your KWSP annual statement from i-Akaun. Overclaiming and underclaiming are both errors.

What Qualifies for EPF Tax Relief

Employee EPF contributions (9% deducted from salary for employees below age 60)
Voluntary top-up contributions made directly to KWSP (up to the RM 4,000 cap)
Contributions under i-Saraan scheme (self-employed / voluntary participants)
EPF contributions for employees aged 60+ (5.5% rate — actual amount claimed, up to RM 4,000)
EPF contributions for domestic workers whose employers register them with KWSP

Employer EPF contributions (13% or 12%) — these are the company's cost, not deductible by you
PRS (Private Retirement Scheme) contributions — these use a separate RM 3,000 relief limit
Contributions to foreign pension funds — only KWSP and approved Malaysian schemes qualify
SOCSO / EIS contributions — these are a separate RM 350 relief (Section 46(1)(f)(i))
Contributions above RM 4,000 — the excess is not deductible

Track EPF, PRS, Life Insurance & All 24 Reliefs — Automatically

Malaysia Tax Planner 2026 includes a Relief Tracker tab that calculates your exact EPF relief, shows if you've hit the RM 4,000 cap, and combines all 24 reliefs to show your true tax liability for YA 2025.

Download Tax Planner 2026 — RM 42 →

i-Saraan — EPF Tax Relief for the Self-Employed

If you are a freelancer, sole proprietor, gig worker, or otherwise not enrolled in mandatory EPF, you can still claim the EPF tax relief through i-Saraan — KWSP's voluntary contribution programme for individuals outside formal employment.

Open a KWSP Member Account

If you don't have an EPF account, register at any KWSP branch or via the KWSP website. You'll need your MyKad and a Malaysian bank account.

Contribute Under i-Saraan

Make voluntary contributions via i-Akaun (online), KWSP branches, or approved banks. Contribute up to RM 4,000 per year to maximise the EPF tax relief.

Receive Government Incentive

The government contributes a matching incentive directly into your KWSP account for i-Saraan participants who contribute at least RM 1 per year (credited the following year).

Claim in Form B

Self-employed individuals file Form B (deadline: 30 June 2026 for YA 2025). Your i-Saraan contribution appears in your KWSP annual statement — enter it in the EPF relief field, capped at RM 4,000.

Why i-Saraan Makes Financial Sense Beyond Tax Every RM 4,000 contributed earns EPF's annual dividend (historically 5.5%–6.15%) AND reduces your tax by up to RM 960 (at 24% bracket). The effective return on that RM 4,000 is your EPF dividend rate PLUS your marginal tax saving — making it one of the best guaranteed-return retirement savings options available to self-employed Malaysians.

EPF Relief vs PRS Relief — Two Separate Limits

Many Malaysians confuse EPF relief and PRS (Private Retirement Scheme) relief. They are different products with different relief limits — and you can claim both.

Item	EPF (KWSP)	PRS (Private Retirement Scheme)
What it is	Mandatory government retirement fund	Optional private retirement fund (Principal PRS, Manulife PRS, Public Mutual PRS, AmPRS)
Annual relief cap	RM 4,000	RM 3,000
Mandatory for employees?	Yes (formal employment)	No (voluntary)
Relief section	Section 46(1)(f)	Section 49C
Combined with life insurance?	No — EPF is separate	PRS is separate from life insurance (life insurance has its own RM 3,000 cap)
Maximum combined claim	EPF RM 4,000 + PRS RM 3,000 + Life Insurance RM 3,000 = up to RM 10,000 in retirement/insurance reliefs

Maximum Stack: EPF + PRS + Life Insurance = RM 10,000 Relief If you contribute RM 4,000 to EPF, RM 3,000 to a PRS fund, and pay RM 3,000 in life insurance/takaful premiums — you reduce your chargeable income by RM 10,000 from these three reliefs alone. At a 24% tax rate, that saves RM 2,400 in tax.

How to Claim EPF Tax Relief in e-Filing (Form BE)

EPF relief is one of the easiest reliefs to claim because LHDN pre-fills it from KWSP data. However, always verify before submitting.

Get Your Form EA from Your Employer

Your Form EA (issued by your employer by 28 February 2026) shows your total employee EPF contributions in Section F — "Statutory EPF Deduction." This is your primary reference number.

Log in to MyTax → Open Form BE

Go to mytax.hasil.gov.my → e-Filing → Form BE (YA 2025). LHDN pre-fills your EPF amount from KWSP's data submission.

Navigate to Part F — Relief

In Form BE, go to Part F (Pelepasan). Find "Caruman kepada KWSP / EPF" (Statutory EPF). Verify that the pre-filled amount matches your Form EA Section F total.

Correct if Needed

If you changed jobs, made voluntary top-ups, or the amount looks wrong — edit it manually to match your total actual employee contributions, capped at RM 4,000. Download your KWSP i-Akaun annual statement to verify the exact figure.

Check PRS Section Separately

If you contributed to a PRS fund, find "Caruman kepada Skim Persaraan Swasta / PRS" separately. This is a different field with a RM 3,000 cap — do not mix it with the EPF field.

Common Discrepancy	Cause	Fix
Pre-fill shows RM 0 for EPF	New employee — KWSP data not yet synced to LHDN	Enter manually using Form EA + KWSP i-Akaun statement
Pre-fill is lower than actual	Joined second employer mid-year — only first employer's EPF captured	Add both employers' contributions (up to RM 4,000 total)
Pre-fill shows RM 4,000 but actual is less	KWSP data rounded up or estimated	Reduce to actual amount from Form EA to avoid overclaiming
PRS amount mixed into EPF field	Both appear on the same KWSP statement	Separate them — EPF to EPF field (cap RM 4,000), PRS to PRS field (cap RM 3,000)

Reduce Your Monthly PCB Using EPF Relief — TP1 Guide

Your EPF contribution is already factored into the standard PCB (Potongan Cukai Bulanan) calculation that your employer uses. However, if you make voluntary top-up contributions to KWSP (above the mandatory 9%), your employer's payroll system may not know about them — leading to over-deduction of PCB throughout the year.

To fix this: submit Form TP1 to your HR or payroll department, declaring your expected annual EPF contributions (including voluntary top-ups). Your employer will recalculate your monthly PCB based on the full RM 4,000 EPF relief, reducing your monthly take-home reduction.

Monthly Salary	PCB Without TP1 (estimated)	PCB With TP1 (RM 4,000 EPF declared)	Monthly Saving
RM 5,000	~RM 145	~RM 121	~RM 24/month
RM 8,000	~RM 495	~RM 415	~RM 80/month
RM 12,000	~RM 1,040	~RM 880	~RM 160/month

The actual PCB difference from EPF alone may be modest (because EPF is typically already factored into the default formula). The larger PCB savings come from declaring all your reliefs on TP1 — lifestyle, insurance, education, medical — not just EPF. Use the PCB Calculator to see your full monthly deduction with all reliefs declared.

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Frequently Asked Questions — EPF Tax Relief Malaysia 2026

How much EPF tax relief can I claim in Malaysia for YA 2025?

You can claim up to RM 4,000 in EPF tax relief for YA 2025, but only the amount you actually contributed as an employee — not necessarily the full RM 4,000 cap. Only your own (employee) contributions qualify. Your employer's contributions (13% or 12%) do NOT qualify for your personal income tax relief. You hit the RM 4,000 cap if your monthly salary is approximately RM 3,704 or higher (because 9% × RM 3,704 × 12 months = RM 4,000). If your salary is below this, you can only claim your actual annual contribution amount.

Does the employer's EPF contribution count toward my tax relief?

No. Only your own employee contribution qualifies for the RM 4,000 EPF tax relief. For most employees earning below RM 5,000/month, the employee contribution rate is 9% and the employer contributes 13%. Only the 9% employee share is eligible for tax relief. Your KWSP annual statement shows both employer and employee contributions separately — enter only the employee total (Section F of your Form EA shows this as 'Statutory EPF') into your e-Filing Form BE.

Is EPF tax relief automatically pre-filled in my e-Filing?

Yes — LHDN receives your EPF contribution data directly from KWSP. When you open your e-Filing Form BE, the EPF field is usually pre-populated with your contribution amount. However, always verify it against your Form EA (issued by your employer by 28 February) and your annual KWSP statement. Common discrepancies: if you changed jobs mid-year, your second employer's EPF may not appear; if you made voluntary top-up contributions, these may need to be added manually (up to the RM 4,000 cap); and if you contributed to both EPF and a Private Retirement Scheme (PRS), these use separate relief limits.

Can a self-employed person claim EPF tax relief in Malaysia?

Yes — through i-Saraan, KWSP's voluntary contribution scheme for the self-employed and informal sector. If you are a freelancer, gig worker, business owner, or otherwise not under mandatory EPF, you can open a KWSP account and contribute voluntarily under i-Saraan. Your voluntary contributions count toward the same RM 4,000 EPF tax relief. Additionally, the government provides a special incentive (credited directly into your KWSP account) for i-Saraan participants who contribute at least RM 1 per year. The amount contributed — up to RM 4,000 per year — is deductible from your chargeable income when you file Form B (deadline: 30 June 2026 for self-employed).

What is the difference between EPF relief and PRS relief?

EPF (KWSP) relief and PRS (Private Retirement Scheme) relief are separate, with different caps. EPF relief: up to RM 4,000 per year for employee EPF contributions (or voluntary i-Saraan contributions). PRS relief: up to RM 3,000 per year for contributions to a KWSP-approved Private Retirement Scheme (e.g., Principal PRS, Manulife PRS, Public Mutual PRS, AmPRS). Life insurance/takaful premium: also up to RM 3,000, but shared with the general insurance cap. You can claim all three: EPF (RM 4,000) + PRS (RM 3,000) + Life insurance/takaful (RM 3,000) simultaneously. They are independent limits, not combined.

What if I changed jobs during the year — how do I claim EPF from two employers?

If you worked at two companies during YA 2025, you will have two separate EPF contribution records. Each employer deducted 9% EPF from your salary. Your total employee EPF contributions from both employers combined is your eligible relief amount, capped at RM 4,000. When you file e-Filing, LHDN's pre-fill may not capture both employers' EPF accurately — especially if the second employer only submitted their statements late. To verify: log in to KWSP's member portal (i-Akaun) and download your annual statement showing total employee contributions for 2025. Also request Form EA from both employers. Enter the total (up to RM 4,000) manually if the pre-fill is incomplete.

How does EPF relief affect my monthly PCB deduction via TP1?

Your PCB (monthly tax deduction by employer) is calculated based on your declared reliefs. By submitting Form TP1 to your employer, you declare your expected EPF contributions for the year. Your employer then factors the RM 4,000 EPF relief into your monthly PCB calculation — reducing the amount deducted each month. Without TP1, your employer calculates PCB assuming you have not declared the EPF relief separately (though EPF is already pre-included in the default PCB formula for many employers). If you are over-paying PCB, submit TP1 to reduce monthly deductions and improve cash flow. You can check expected PCB with and without TP1 using the PCB calculator on Smarterpik.