Income tax YA2026: 0% to 30% rates unchanged, RM400 rebate and the reliefs that changed

Year of assessment 2026 (YA2026) covers the income you receive throughout 2026. Employees without business income declare it in Form BE through e-Filing in 2027.

The Inland Revenue Board (LHDN) has not announced the 2027 e-Filing dates, based on our check on 20 Oct 2026. For reference, under the 2026 Return Form Filing Programme, e-Filing of Form BE for YA2025 opened on 1 Mar 2026. The deadline was 30 Apr 2026, with an e-Filing grace period until 15 May 2026.

YA2026 tax rates stay at 0% to 30%

Budget 2026, tabled on 10 Oct 2025, did not change the tax rates for resident individuals. The Budget 2027 Tax Measures appendix, tabled on 9 Oct 2026, still lists the same rates as the current position.

The rates apply in bands, not to your whole income. For example, on chargeable income of RM46,650, the first RM35,000 is taxed RM600, and the remaining RM11,650 is taxed at 6%.

RM400 rebate only if chargeable income is RM35,000 or less

A rebate is deducted directly from your tax, not from your income. According to LHDN's Form BE explanatory notes, the RM400 self rebate is given if chargeable income does not exceed RM35,000 (paragraph 6A(2)(a) of the Income Tax Act 1967). A further RM400 rebate is given if you are also allowed the RM4,000 spouse relief.

Zakat and fitrah paid in that year are also deducted from your tax, but not beyond the amount of tax charged.

This RM35,000 limit matters. Chargeable income of RM35,000 is taxed RM600 before the rebate, which is RM200 after the rebate. At RM35,001, the tax is RM600.06 because the rebate no longer applies. Valid reliefs can bring your chargeable income back below that limit.

Reliefs that changed for YA2026

Individual relief stays at RM9,000, the amount in force since YA2010. The EPF relief limit of RM4,000 and the SOCSO (including EIS) limit of RM350 are also unchanged. The following Budget 2026 changes apply from YA2026, and are also listed in LHDN's 2026 PCB specification:

• Vaccination for yourself, your spouse and children (limit RM1,000) now covers all vaccines registered and approved by the National Pharmaceutical Regulatory Agency (NPRA). This expansion also applies to full medical examinations for parents and grandparents.
• The RM3,000 relief for nursery or kindergarten fees is made permanent. Day care centres and after-school transit centres registered with the Department of Social Welfare (JKM) also qualify, for children aged 12 and below.
• The limit for diagnosis, early intervention and rehabilitation treatment for children with learning disabilities rises from RM6,000 to RM10,000. The overall medical relief limit stays at RM10,000.
• Life insurance or takaful relief of up to RM3,000 now includes policies for children.
• The RM2,500 relief for electric vehicle chargers and composting machines now includes food waste grinders and home CCTV, for YA2026 and YA2027. This claim is allowed once within the two years of assessment.
• Entrance fees to museums, zoos, theme parks, national parks and cultural programmes can be claimed up to RM1,000 for YA2026.

Example calculation: salary of RM60,000 a year

Tax of RM1,299 is about 2.2% of annual income, even though the rate on the last ringgit is 6%. This is because each band is charged at its own rate.

These figures were calculated with this site's tax calculator at YA2026 rates. They are estimates, and the official amount is determined by LHDN based on your Form BE.

Budget 2027 proposals for YA2027: status Expected

Budget 2027 was tabled on 9 Oct 2026. Its individual tax measures start from YA2027, which is 2027 income filed in 2028. They do not change your YA2026 tax.

• Individual relief rises from RM9,000 to RM12,000.
• The rate for chargeable income of RM70,001 to RM100,000 falls from 19% to 18%.
• A new band of RM100,001 to RM150,000 is taxed at 24%, compared with 25% now.
• The 30% rate starts at chargeable income above RM1 million, no longer RM2 million.
• The scope of several reliefs is widened, for example postnatal care, sports shoes and AI software subscriptions. Voluntary LINDUNG 24 Jam contributions also get an additional relief of up to RM150.

For the RM60,000 example above, these proposals lower the tax to RM1,119, which is RM180 less (calculated). According to the Budget 2027 Speech, these measures will give up to RM1,600 more disposable income to about 5 million taxpayers. All these measures are still proposals and are not yet law.

What it means for you

• Keep receipts for 2026 expenses you want to claim, such as nursery fees, vaccines or children's life insurance.
• If your chargeable income is close to RM35,000, review the reliefs you qualify for. The RM400 rebate only applies at or below that limit.
• Check your 2026 PCB amounts on your payslips. If PCB exceeds your actual tax, Form BE will show a tax overpayment.
• For more accurate PCB for the rest of 2026, declare your reliefs to your employer through Form TP1. This claim is subject to your employer's approval.
• Try the tax estimate calculator and choose YA2026. For monthly deductions, use the Net Salary Calculator.
• Fill in Form BE only on MyTax through hasil.gov.my, typed in yourself. Do not share your password or TAC with anyone.