Participating in a Private Retirement Scheme (PRS) can provide you with an income tax deduction of up to RM3,000.
Since 2012, the government has been promoting the PRS, which is aimed at people who want to make extra preparations for their retirement.
Working people are required to contribute 11% of their salary to the EPF every month. If you want to save more for your retirement, you can invest the extra money in your EPF in the PRS after you have contributed to it.
The Private Retirement Fund (PRS) is designed to give people a second option in addition to the Employees Provident Fund (EPF). The PRS is managed by individual trusts in the country, but is overseen by the PPA established by the government. Therefore, there is no doubt about the legitimacy of the PRS.
The first advantage of PRS is that investors are free to choose the trust units they want to invest in. PRS investors are also entitled to a personal income tax deduction of up to RM3,000.
There are two disadvantages to PRS, namely there is no guaranteed annual dividend payout, so members cannot determine the minimum return they will receive each year, and PRS investors will have to pay a fee when they withdraw their deposits.
Top 4 Benefits of PRS
1. Investors can enjoy tax relief of up to RM3,000
2. Tax exemption on investment profits
3. Funds are exempted from bankruptcy laws
4. members have the right to choose their investments
