Malaysia Income Tax Calculator 2026
Calculate your Malaysian taxes: PCB (Monthly Tax Deduction) + EPF + SOCSO/EIS
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0 MYR
Effective rate: 0%
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~11.5% (employee share)
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Monthly: 0 MYR
Income Distribution
Effective total rate: 0%
Complete Guide to Malaysian Taxation
Malaysia operates a progressive income tax system managed by the Inland Revenue Board of Malaysia (LHDN - Lembaga Hasil Dalam Negeri). The system uses self-assessment where taxpayers calculate and file their own taxes. Malaysian tax residency is based on the 183-day rule: anyone staying in Malaysia for 182 days or more in a calendar year is considered a tax resident.
Income Tax Brackets 2026
Malaysia has a 9-tier progressive tax system with rates ranging from 0% to 28%:
- MYR 0 - MYR 5,000: 0%
- MYR 5,001 - MYR 20,000: 1%
- MYR 20,001 - MYR 35,000: 3%
- MYR 35,001 - MYR 50,000: 6%
- MYR 50,001 - MYR 70,000: 11%
- MYR 70,001 - MYR 100,000: 19%
- MYR 100,001 - MYR 400,000: 25%
- MYR 400,001 - MYR 600,000: 26%
- Above MYR 600,000: 28%
Note: Non-residents are taxed at a flat rate of 30% on Malaysian-sourced income.
EPF - Employees Provident Fund (KWSP)
Kumpulan Wang Simpanan Pekerja (KWSP/EPF)
The EPF is Malaysia's mandatory retirement savings scheme. Contributions are shared between employer and employee.
- Employee contribution: 11% of monthly wages
- Employer contribution: 12% (for wages > MYR 5,000) or 13% (for wages <= MYR 5,000)
- Contributions are tax-deductible up to MYR 4,000/year
- Dividends earned in EPF are tax-exempt
SOCSO & EIS - Social Security
SOCSO (PERKESO) + EIS (SIP)
| Contribution | Employee Rate | Employer Rate | Description |
|---|---|---|---|
| SOCSO (Employment Injury) | - | 1.25% | Work-related injuries |
| SOCSO (Invalidity) | 0.5% | 0.5% | Disability pension |
| EIS (Employment Insurance) | 0.2% | 0.2% | Unemployment benefits |
| Total Employee | ~0.5% | ~1.95% | Capped at wage ceiling |
Note: SOCSO contributions are capped at MYR 5,000 monthly wage ceiling.
PCB - Monthly Tax Deduction
Potongan Cukai Bulanan (PCB)
- PCB is Malaysia's pay-as-you-earn (PAYE) withholding tax system
- Employers must deduct tax monthly from employees' salaries
- PCB is calculated using LHDN's Schedule or e-PCB calculator
- Employees can claim reliefs through Form TP1 to reduce PCB deductions
- Final tax liability is determined during annual tax filing
Tax Reliefs and Deductions
Personal Tax Reliefs 2026
- Individual relief: MYR 9,000 (automatic)
- Spouse relief: MYR 4,000 (if spouse has no income)
- Child relief: MYR 2,000 per child (under 18)
- Child in higher education: MYR 8,000 per child
- Disabled child: MYR 6,000 additional
- EPF contributions: Up to MYR 4,000
- Life insurance/takaful: Up to MYR 3,000
- Medical insurance: Up to MYR 3,000
- SSPN (education savings): Up to MYR 8,000
- Lifestyle expenses: Up to MYR 2,500 (books, computer, sports)
Special Tax Incentives
- Returning Expert Programme (REP): 15% flat tax rate for qualified returning Malaysians
- Knowledge workers: Special tax rates in Iskandar Malaysia
- Principal Hub incentive: Reduced tax rates for regional HQ operations
- Digital Nomad (DE Rantau): Tax exemption on foreign-sourced income
Non-Resident Taxation
Flat Rate for Non-Residents
- Employment income: 30% flat rate
- Public entertainer: 15%
- Interest: 15%
- Royalties: 10%
- Technical/management fees: 10%
- No tax reliefs available for non-residents
France vs Malaysia Comparison
| Criteria | France | Malaysia |
|---|---|---|
| MYR 100,000 (~EUR 20,000) gross salary | ~EUR 14,500 net | ~MYR 81,000 (~EUR 16,200) net |
| Maximum marginal rate | 45% | 28% |
| Social contributions (employee) | ~22% | ~11.5% (EPF + SOCSO) |
| Tax-free threshold | ~EUR 10,777 | MYR 5,000 (~EUR 1,000) |
| Family quotient | Yes (parts) | No (separate reliefs) |
| Withholding tax | Yes (2019+) | Yes (PCB) |
| Foreign income | Taxable (worldwide) | Exempt (territorial) |
| Cost of living (index) | 100 | ~40-50 |
Tax Filing Calendar
- Tax year: January 1 to December 31
- Filing deadline (e-Filing): April 30 (employment income) / June 30 (business income)
- Paper filing deadline: March 31 / April 30
- Form BE: For employment income only
- Form B: For business/self-employment income
- Tax refund: Typically within 30 working days for e-Filing
Territorial Tax System
Foreign-Sourced Income Exemption
- Malaysia operates a territorial tax system
- Foreign-sourced income remitted to Malaysia was exempt (until 2022)
- From 2022: Foreign-sourced income remitted by tax residents is now taxable
- Exception: Income from partnerships abroad remains exempt
- This makes Malaysia attractive for digital nomads and remote workers
Malaysia offers moderate taxation with incentives for expats. Compare with Southeast Asian countries to choose your destination.