With the cost of raising children continuing to climb, many parents hoped Budget 2027 would raise the per-child tax relief. It did not. The basic child relief stays where it is. What the budget does is widen the reliefs around it, so more of what families spend can be claimed.
What stays the same: the basic child relief
Child relief is generally RM2,000 for each qualifying child below 18. Different limits apply to older children in qualifying full-time education and to children with disabilities. Budget 2027 does not change these limits.
What is new for families
Several family-related reliefs have been expanded. They are expected to apply from the 2027 year of assessment, and they sit within existing limits rather than adding new allowances.
| Relief | What is new | Limit |
|---|---|---|
| Children’s tuition | Courses, classes or tuition in STEM, arts, languages and religion | Up to RM2,000, shared with other courses, within the RM7,000 education relief |
| Postnatal care | Services by a confinement centre or qualified individual | Up to RM3,000, within the RM10,000 health and well-being relief |
| Breastfeeding equipment | Qualifying purchases for children aged two and below | Up to RM1,000, within the same RM10,000 limit |
| Parents’ and grandparents’ care | Covers all types of care, not just medical costs | Up to RM8,000 (unchanged cap) |
| Lifestyle relief | AI software subscriptions for personal use by the taxpayer, spouse or child | Within the existing RM2,500 limit |
Other family reliefs that already exist
Several other reliefs continue to apply, so it is worth checking that you are claiming everything you are entitled to:
- Childcare and kindergarten fees, up to RM3,000, which already covers registered nurseries, kindergartens, daycare and after-school centres for children up to age 12.
- Medical-related reliefs for children, including vaccination, dental care, serious illness treatment, and assessment and rehabilitation for children with learning disabilities, all within the RM10,000 health and well-being relief.
- Life insurance and takaful premiums, which can also cover children.
- SSPN education savings, up to RM8,000, which Budget 2027 does not propose extending beyond YA 2027.
The limits and conditions above are as published at the time of writing. Check the final legislation and LHDN guidelines before you file.
The bigger relief: RM12,000 for everyone
The most significant change for families is the one that applies to every taxpayer. The basic individual relief rises from RM9,000 to RM12,000, which reduces chargeable income for both parents. If both spouses are taxpayers, each benefits. Read our earlier post on this change for the full picture.
What parents should do now
- Keep receipts from 1 January 2027. Tuition, postnatal care and breastfeeding equipment all need proper documentation.
- Decide who claims what. For couples who are both taxpayers, plan who claims each child-related expense so nothing is claimed twice or missed.
- Track your limits. Many of these items share caps, so know how much of each limit you have used.
- Wait for LHDN guidance before you finalise your YA 2027 claims.
Speak to AdrianYeo Tax
Family finances involve many moving parts, and tax relief is one of the easiest to get wrong. Our chartered accountants can help you work out what to claim and keep your documents organised.
This article is for general information only and does not constitute tax advice. Measures are based on Budget 2027 announcements and may change when the legislation is finalised. Please consult a tax professional about your specific circumstances.
