SSPN : Disadvantages

SSPN comes with quite a few attractive advantages, but it also has its downsides.

Income Tax Relief is NOT Available for Individual With Own SSPN Account

As this account aims to promote savings for higher education and not for individual interest, the income tax relief is not made available unless you have a legal beneficiary for your account (your own children OR a child under your legal care OR immediate family members).

So to summarise, you can still open an account for your nephew, auntie, best friend etc. but unless you fall under the categories above, you will not be given the income tax relief!

Withdrawing Your Money

Unfortunately, withdrawing money from your SSPN account is not a simple task! Unlike the normal savings account, SSPN has very strict rules when it comes to withdrawing your money.

Depositors can only withdraw their money once a year, and the maximum amount that is allowed to be taken out is RM 500 or 10% of your total savings!

A 100% withdrawal is possible but will require the beneficiary’s offer letter to local university or colleges, a vague statement on the beneficiary ‘no longer wishing to participate in the educational process’, or in the event of the beneficiaruy’s / depositor’s death or incapacitation.