EMPLOYERS who help to pay back their workers’ outstanding loans from the National Higher Education Fund Corporation (PTPTN) will enjoy a tax exemption this year.
This tax benefit was announced by the Government last November under Budget 2019.
“We want to reach out to employers from the private sectors such as banking, telecommunications and multimedia to help by paying their employees’ PTPTN loans as part of their corporate social responsibility.
“It will be a win-win situation for both parties. PTPTN offered loans to students to produce the best human capital for the job market.
“Now, employers can pay back as part of their initiative, ” said PTPTN public relations and event management senior general manager Abdul Ghaffar Yusop at Menara PTPTN in Kuala Lumpur.
“We also want to turn their (employers’) heart and mind towards their staff’s well-being. They have to consider their employees as valuable assets who can contribute to the development of their industries, ” he added.
Abdul Ghaffar said workers whose loans have been paid up by their employer would be more productive, motivated and loyal to their company.
Employers can settle the loan in full or pay in monthly installments, till Dec 31 this year. They are prohibited from placing their workers on an employment bond as a condition for paying off their loan.
Employers also cannot make deductions from employees’ wages in relation to the company settling their PTPTN loans. Errant employers can face action from the Inland Revenue Board.
Abdul Ghaffar clarified that if the PTPTN borrower is self-employed or runs his own business, he will not be eligible for this tax exemption.
“He is also not eligible if he pays up the loans of employees who happen to be his siblings, spouse, children or grandchildren. This is to avoid manipulation, ” he said.
There is no minimum or maximum amount of loan payment for employers to enjoy the tax exemption. “If the employer pays up a RM50,000 loan, he is qualified for a RM50,000 tax exemption, ” he said.
Abdul Ghaffar said employers could offer PTPTN loan repayment as incentives to their staff.
“Some employers provide annual bonus or holiday packages to show their appreciation for their employees.
“Now they can offer to pay their employees’ PTPTN loans and enjoy the tax exemption.”
He urged corporate bodies, multinational corporations and government-linked companies to help employees pay back their staff’s PTPTN loan.
Vector Infotech Sdn Bhd managing director Hii Ding Sin, who supports the employer loan repayment plan, said his network solutions-based company has helped its two project engineers with their PTPTN loans.
“We paid about RM37,000 in full (loan) settlement for a project engineer in June this year. As for the other project engineer, we paid for him more than RM26,000 in August. This is incentive for them to increase productivity while working with us, ” he said.
Hii shared that the management would be paying for more employees’ PTPTN loans in monthly instalments, as part of the company’s commitment to help society and enable more people to pursue education.
“I came from a poor family, and it is important to support PTPTN’s contributions to help produce more competent workers from university level, ” Hii added.
Employers can pay their worker’s PTPTN loans via www.ptptn.gov.my (Portal Majikan Online). Receipts can be downloaded after the transaction, while PTPTN will issue statements of the payments in early 2020.
Did you find this article insightful?
100% readers found this article insightful