7 Tax Questions Medical Practitioners Must Know in 2025 (Part 2)

Q4. How is professional indemnity insurance premium treated for tax purposes?

A4. Professional indemnity insurance premiums often span multiple financial years.

For example, if a policy covers 1 July 2024 to 30 June 2025, the expense must be apportioned based on the financial year-end, following the matching principle:

• The portion from July to December 2024 is deductible in FYE 2024.
• The portion from January to June 2025 is deductible in FYE 2025.

The full premium cannot be claimed in a single year; the expense must be allocated according to the coverage period.

Q5. Are life membership fees to professional societies tax deductible?

A5. Membership fees paid to professional bodies, such as the Academy of Medicine of Malaysia or the Obstetrical and Gynaecological Society of Malaysia, are deductible, as long as they are wholly and exclusively related to generating your professional income.

These memberships not only boost your professional credibility but also provide tax benefits.

Q6. Can I claim capital allowance for a motor vehicle used in my practice??

A6. If you purchase a car for your medical practice, you may be eligible for capital allowance (CA). To qualify, you must meet these conditions:

• Be operating a business during the basis period.
• Incur qualifying expenditure (QE).
• Own the asset at the end of the basis period.
• Use the asset for business purposes.

If these criteria are satisfied, you can claim both Initial Allowance (IA) and Annual Allowance (AA).

Q7. Are postgraduate diploma course fees deductible?

A7. If you enroll in an online specialist postgraduate diploma costing, for example, RM30,000, the fee is deductible as a business expense under Section 33(1), provided it enhances your professional skills and is entirely related to generating business income. However, you can only claim it once—either as a business expense or as personal tax relief (up to RM7,000). Claiming both is not allowed, as it constitutes double deduction, prohibited under Section 39(1)(c).