“Boss, my father just came out from hospital.
Can I take extra paid leave to care for him?”

The boss’s heart says,
“Of course. Family is important.”

The boss’s cash flow says,
“Aiyo…who pays?”

Now, the Government may share a small part of the cost.

Under P.U. (A) 289/2026, a qualifying employer may claim an additional 50% tax deduction on payment for additional paid leave given to a full-time employee to care for:

✅ A child below 2 years old.
✅ A sick immediate family member.
✅ A disabled immediate family member.

Immediate family may include spouse, parents, parents-in-law, children, siblings and grandparents.

But Boss, please don’t misunderstand.
This is not a 50% cash refund.

If the qualifying leave payment is RM3,000:
Normal tax deduction: RM3,000.
Additional tax deduction: RM1,500.
Total potential tax deduction: RM4,500.

At a 24% tax rate, the extra tax saving is approximately RM360, subject to sufficient taxable income.

Government helps a bit.
The employer still pays the salary.

To qualify:

✅ The employee must be full-time.
✅ Sick family members require proper medical certification.
✅ Disabled family members require JKM certification.
✅ TalentCorp verification is required.
✅ The incentive applies from YA 2025 to YA 2027.

Certain employers are excluded, including sole proprietorships, employee-controlled companies and specified related-party employers.

So you cannot approve your own leave, pay yourself and ask LHDN to subsidise it. LHDN also knows how to read an organisation chart.

This tax incentive will not make your company rich.

But it may help you keep a good employee during the most difficult period of their life.

Staff may forget your annual dinner menu.
They may forget the lucky draw prize.

But they will remember the boss who did not force them to choose between their salary and their sick parents.

Sometimes, the best staff retention policy is not another motivational speech.

It is giving your people breathing space when life becomes difficult.

If your company has already granted additional paid care leave, check your leave policy, supporting documents, company structure and TalentCorp requirements before claiming.

Source: Income Tax (Deduction for Payment of Additional Paid Leave for the Care of Child or Sick or Disabled Immediate Family Member) Rules 2026, P.U. (A) 289/2026.