About a week ago, we shared an update on the tax exemption given to women returning to work after a career break. This time, the government has gazetted a related rule that benefits the employer instead. Under the Income Tax (Deduction for Employment of Approved Individual) Rules 2026, P.U. (A) 229, gazetted on 23 June 2026, companies that hire these women can now claim an additional tax deduction equal to 50 percent of the eligible remuneration paid to them. This deduction is on top of the usual deduction already allowed under section 33 of the Income Tax Act.

The rule applies from year of assessment 2025 to year of assessment 2027. The extra deduction can be claimed for up to 12 consecutive months for each approved individual hired. To qualify, the employer must meet conditions set by the Minister, and compliance must be verified by Talent Corporation Malaysia Berhad.

Not every employer qualifies. P.U. (A) 229 excludes companies controlled directly or indirectly by the approved individual, sole proprietorships, and close relatives of the approved individual such as parents, children, siblings, grandparents or spouses. This keeps the incentive focused on genuine new hiring rather than arrangements within the same family or business.

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