Payroll.my

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5 years 6 months ago #24 by Horizon
Replied by Horizon on topic Payroll.my
Thanks! :)

to confirm about the payroll.my,
"Salary" = basic w/o deduction of EPF?
"Bonus" = allowance/incentive...?

When i apply my example 1 into Payroll.my, i get result as in attachment 1
Isn't that tax should be RM176 according to PCB 2013? please let me know if I made the wrong calculation, it is my first time doing PCB for company :P
Basic remuneration : 4000 - 440 = 3560
additional remuneration : 1000
total : 4560
RM4560 under category KA2 is RM176



Also, in attachment 2
tax should be RM183 instead of RM189 right? basic remuneration = 5000 - 550 = 4450



thanks again

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5 years 6 months ago #25 by Horizon
Replied by Horizon on topic Payroll.my
ops... is my attachment workings?
attachment 1
File Attachment:


attachment 2
File Attachment:

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5 years 6 months ago - 5 years 6 months ago #26 by Kap-Chew
Replied by Kap-Chew on topic Payroll.my
To answer your questions:

1. According to Inland Revenue Board of Malaysia:

  • MTD is an income tax deduction mechanism from an employee's current monthly remuneration in accordance with the Schedule of Monthly Tax Deductions or other methods approved by the Director General according to the provision under rule 3, Income Tax (Deduction from Remuneration) Rules 1994 (MTD Rules).
  • Remuneration means income in respect of gains or profits from an employment other than benefits in kind under paragraphs 13(1)(b) and 13(1)(c) of the Act provided that in the case where an irrevocable election is made by an employee under rule 2A, the gains or profits from an employment shall include the benefits in kind under paragraphs 13(1)(b) and 13(1)(c) of the Act.

    4.3.1 Types of Remuneration which are Subject to MTD

    The types of remuneration which are subject to MTD are as follows:

    (i) salary;
    (ii) wages;
    (iii) overtime payment;
    (iv) commission;
    (v) tips;
    (vi) allowance;
    (vii) bonus or incentive;
    (viii) director fees;
    (ix) perquisite;
    (x) employee's share option scheme (ESOS);
    (xi) tax borne by the employer;
    (xii) gratuity;
    (xiii) compensation for loss of employment; or
    (xiv) other remuneration related to employment;

So in your example, the remuneration is considered the total of RM 4000 + RM 1000 = RM 5000

2. Payroll.my's salary calculator allows you to enter the gross monthly salary, in this case RM 5000 to calculate the EPF, SOCSO and MTD for the employee. You do not have to deduct the EPF portion prior to calculation.

3. Maximum deductible EPF from tax calculation purpose is RM 6000 per annum, which translates into RM 500 per month. Hence your last portion of example, i.e. RM 5000 - RM 550 is incorrect.

4. Allowance should not be entered as Bonus in this case, because the real Bonus calculation will incur much higher tax. Bonus is special rewards to employees on a quarterly, half yearly or yearly basis.
Last edit: 5 years 6 months ago by Kap-Chew.
The following user(s) said Thank You: Luke Hayler

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