Question:- I have four children. Three registered under my wife and one registered under my name for the National Education Savings Scheme (SSPN). How is the tax rebate claimed in such a situation?
Your wife is entitled to claim the net deposits (but limited to a maximum of RM6,000) in the three accounts registered under her own name. Likewise, you are entitled to claim the same for the accounts registered under your name. The claim is only allowed for Years of Assessment 2012 to 2017.
How to open a SSPN account.
Question:- If I invest RM3,000 on the Private Retirement Scheme (PRS) this year, can I claim the rebate, then sell it early next year and reinvest? Can the reinvestment be claimable again against RM3,000? Can this approach also apply to the SSPN scheme?
An individual can claim an aggregate amount of payment of deferred annuity or contribution to the PRS or both up to maximum of RM3,000 for a year. In this respect, technically, you could claim contributions to PRS (assuming that you are not claiming for payment of deferred annuity) based on your aggregate amount of contributions to the PRS as evidenced by the relevant statement issued by the PRS.
However, effective from Jan 1 this year, the withdrawal of contributions from a PRS by an individual before he reaches the age of 55 would be subject to a withholding tax at the rate of 8%. In addition, contributions to a PRS may involve some terms and conditions which may not offer you the flexibility to switch over to another PRS in the subsequent year. The claim for deduction for contributions to PRS is from Years of Assessment 2012 to 2021.
With regard to the deduction for deposits in the SSPN account, the allowable deduction is limited to the net deposit (after taking into account the withdrawals during the same year) and up to a maximum of RM6,000. Further, we understand that there could be some restriction on the quantum that you could withdraw from the SSPN account. The claim for deduction for net deposit into the SSPN account is from Years of Assessment 2012 to 2017.
How to open a PRS account