Hi, I got retrenched in March 2106 and since then I could not get a job in MY. I was told by the HR that I can file for tax relief due to retrenchment. However, I could not find this option in the BE form. May I know how to go about this? Thanks.

what kind of tax relief you are looking for?

This compensation is exempted from tax

If compensation received is due to ill health
Compensation received in other cases:
Termination before 1st July 2008 - exemption of RM6,000 for every completed year of service with the same employer or with companies in the same group
Termination on or after 1st July 2008 - exemption of RM10,000 for every completed year of service with the same employer or with companies in the same group

Did you receive any compensation or gratuity from your previous company? It's taxable but it also has exemption.

I think there's no personal relief for retrenchment. Only if you have a family, your wife/husband doesn't work, then under joint assessment, you can deduct for RM4k only.

First year learning tax, don't blame me if I'm wrong. Just trying to help.

Yes, compensation is a part of your gross income in Section 13 (1)(e), you can deduct for this one.

But if you got gratuity, it goes to Section 13 (1)(a). RM1k for each completed year of service

Thank you so much. I'll take a look at it right now!

Your welcome

Interested to know, saw those info in other site, The question is where and how to file? visit LHDN?

U can just follow the amount as per ur ea form

Btw its cp22a tax relief form that you are asking. Ur employer should fill in the notification of cessation of employment to lhdn

How/Where to specify exemption of RM10,000 for every completed year of service? Don't see any column to fill in.

Agree. there is already an item for "5. Pampasan kerana kehilangan pekerjaan"...

Thanks for responding.

Doing e-filling. Don't see item "5. Pampasan kerana kehilangan pekerjaan"...

You think can fill in no 1 or 2?




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10k relief per year of service.

Yes, we know. Does anyone know and which part of the form to file in e-filing?

If I recall correctly, 4 yrs ago I spoke with LHDN and they advised that I just take out RM70k from the EA issued by my previous employment. Just ensure you keep the termination letter with the amount indicated.

Also, IIRC, there is a limit of RM10k per year upto max 7 yrs.

You guys really need to call LHDN to discuss this. Get the correct feedback accordingly.

This post has been edited by kslian: Mar 15 2017, 08:36 AM

Just saw this in my nota penerangan.

it is RM10k relief per year of full service. Didnt say anything about 7 yrs limit.

And it is to be deducted from your total EA form amount.

Again, call LHDN to reconfirm this.


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believe we need to get letter from HR and walk in to LHDN office to get exemption letter and revert back to HR to exempt it..

This is the practice advised by the hr from company i am working for...and yea.. this shall be done before last payment is done to your account from the company...

I am also having the same problem.. May I know which column of EA 2017 I can fill in?

Please help. I have same problem now.. Any ppl can assist?

I have same problem... if you know how to fill in please let me know

i got my retrenchement also , hr give me some doc and i pass to lhdn .. lhdn will audit your 7 years if no issue , lhdn will sent you a letter to lepas the money .. give the letter to hr and they will lepas the $$$

This post has been edited by MoonRider: Mar 18 2018, 03:26 PM

When u get retrenched or lost your job due to reason stated in the buku panduan u'll get exemption of 10k for every completed years.
Let say your compensation is 200k..and has worked with the same Co for 10 yrs..so u only need to declare 100k as income.
Only retrenchemnment due to medical ground get full examption.

To get the exemption, normally your HR will issue a request to LHDN for SPC sijil penyelesaian cukai. LHDN then will calculate the exact tax to be paid base on the amount and reason provided by HR.

A copy of SPC will be issued to tax payer and HR.

i also got retrenched. In my EA form, it just show the Potongan Cukai Bulanan (PCB). The tax amount that paid to LHDN during tax clearance not in EA form. Should I just add the tax clearance amount in SPC (Surat perlepasan Cukai) into Potongan Cukai Bulanan (PCB) in Borang BE?

Interested to know about this.
How to declare the money receive is due to retrenchment?
I can’t find any column in the e-filing form which relates to retrenchment.

did you get tax clearance form since u have been retrenched? and if no need to pay anything, just fill up as usual as per your EA form

Need to fill in working sheet HK-2.7, it give example on how to calculate the tax exemption.

After fill in the form, no need to submit via e-filing, keep it for your own record, if lhdn ask for audit, show them the form.

Mean at e-filling, you direct deduct the relief amount and submit.

Say total income 100k, retrenchment relief is 40k, so you just submit 60k as income.

Keep your termination letter and the letter stated how many compensation you received for record.

This explanation is for only for Retrenchment Benefit

Here I explain simple for you.

Condition: Lets say you already get you money (means CP22A etc is cleared)


1. You DONT declare what you received during efilling if what you get is LESS than 10K a year.

Example, you already work 10 years, and you received 90K retrenchment benefit. Meaning 90K / 10years is only 9K a year.

So that means you no need to declare that 90K.



2. You NEED declare what you received during efilling if what you get is MORE than 10K a year

Example, you already work 10 years, and you received 120K retrenchment benefit. Meaning 120K / 10years is 12K a year.

So that means you need to declare the 20K.

Yes, only the 20K is taxable.

The 20K should be plus with your Basic yearly salary.

Summary:

10K a year (X your service years), anything less no need declare, anything more, need to declare the balance.




I know what some of you thinking during Efilling:
Basic + Retrenchment Benefit minus Retrenchment Benefit non taxable.
But actually in Efilling dun have column like that.

So its Basic + balance of the Retrenchment Benefit (thats more than 10K).

Thats all.

This post has been edited by azbro: Apr 10 2018, 04:00 PM

Here is another simple Example:

1. Your Salary is 8K

You get X0.5 for every year you service.

Lets say 10 years, means you get 4K every year.

That means 0K is taxable (Cos not more than 10K a year rule)

So you work there for 6 months. Company close down

6months X RM8000 = 48K


Ending is what you need to declare in Efilling is 48K+ 0K (Retrenchment Benefit)




2. Your Salary is 8K

You get X1.5 for every year you service.

Lets say 10 years, means you get 12K every year.

That means 2K is taxable.

10years means 20K is taxable.


So you work there for 6 months. Company close down

6months X RM8000 = 48K


Ending is what you need to declare in Efilling is 48K+20K (Retrenchment Benefit)


Note: thats just simple example.

Means for example, if I work for 7 years but my retrenchment benefit/package is less than 70k, no need for me to declare the retrenchment money in e-filing? If more than 70k, which column of the e-filing should I fill up? Is it under Pendapatan berkanun faedah, diskaun, royalti, premium, pencen, etc.?

Sendiri declare RM10K deduction. Make sure you keep the retrenchment letter....

Sendiri declare only if u need to pay.

Or get a refund. They refunded me over 20K that year.

hi bro,

i need your help, i am retrench in Jan 2024 and they pay me the lump sum of basic salary of Jan 2024+ unused leave + commission + notice in lieu + compensation. I already clear by LHDN and got the SPC letter from them as well.

I got the EA form from this company A who terminated me.

In aug 2024, i found a new job with company B and i got the EA form and it is clear on how to submit.

The issue now

1. How do i submit the income receivable for company A in efiling system?

2. Do i need to declare it or just keep the SPC letter as proof and submit only company B?

Please help me and I also trying to go to LHDN to ask for clarification.

Many thanks.

1. First fill out in e-filing the bilangan pengajian field as 2. Then add up your lump sum you received from Company A (should be stated in the EA form that you receive from Company A at the end of Feb 2025) with the salary you received from Company B (you also should receive an EA form from Company B). After that you need to manually minus the tax exemption of 10k per year of service at company A.

Example:

Lump sump from Company A (RM300K for 10 years of service) in Jan 2024
Salary from Company B from August to Dec 2024 (RM5k x 5month) RM25k

Total income for 2024 is 300k + 25k = RM325k
Tax exemption for retrenchment is RM10k x 10 = RM100k

Jumlah Pendapatan is RM325k - 100k = RM225k

2. No need to declare. They should already be aware you were retrench in their files.

I also got trenched in March 2024 and this is how I submitted my e-filing. I have already got my refund of RM21k.

This post has been edited by bashir3: Mar 14 2025, 09:36 AM