This Malaysia Income Tax Guide explains how personal income tax, PCB, chargeable income and tax reliefs work in Malaysia.
It is written for employees, fresh graduates, freelancers and anyone who wants to understand the basics of Malaysian income tax.
This guide is for general information only and should not be treated as professional tax advice.
Estimate annual income tax and effective tax rate.
Estimate monthly tax deduction from salary.
Estimate tax refund or additional tax payable.
Calculate net salary after EPF, SOCSO, EIS and PCB.
Income tax is a tax charged on income earned by individuals and businesses. For employees, common taxable income may include salary, bonus, commission, allowance and other employment income.
In Malaysia, individual income tax is generally calculated based on annual income after deducting allowable reliefs and deductions.
Individuals who earn taxable income may need to register, file a tax return and pay income tax. This includes employees, business owners, freelancers and individuals with other taxable sources of income.
Even if PCB has already been deducted from your salary every month, you may still need to submit an annual tax return depending on your situation.
Chargeable income is the amount of income that is subject to tax after deducting allowable tax reliefs and deductions.
A simple way to understand it is:
Chargeable Income = Annual Income - Allowable Reliefs and Deductions
The lower your chargeable income, the lower your estimated tax may be.
PCB stands for Potongan Cukai Bulanan. It is Malaysia's monthly tax deduction system.
Employers deduct PCB from employees' monthly salary and remit it to the tax authority. PCB helps spread income tax payment across the year instead of paying a large amount at once during tax filing.
However, PCB is not always equal to your final tax payable. Your final tax depends on your actual annual income, tax reliefs, rebates and other filing details.
PCB is the monthly deduction from your salary. Income tax is the final tax calculated based on your annual taxable income.
If your total PCB paid is higher than your actual tax payable, you may receive a tax refund. If your actual tax payable is higher than PCB paid, you may need to pay additional tax.
Tax reliefs reduce chargeable income. Common relief categories may include personal relief, spouse relief, child relief, EPF contribution, insurance, medical expenses, education and lifestyle-related reliefs.
The availability and limit of each relief may change from year to year, so taxpayers should refer to official guidance when filing tax returns.
Assume an employee earns RM60,000 per year and has RM9,000 of tax relief.
The estimated chargeable income would be:
RM60,000 - RM9,000 = RM51,000
Tax is then estimated based on the applicable progressive tax brackets.
A tax refund may happen when total PCB paid during the year is more than the final income tax payable.
For example, if total PCB paid is RM5,000 but actual income tax payable is RM4,200, the estimated refund is RM800.
Taxpayers may reduce tax legally by claiming eligible tax reliefs and keeping proper supporting documents.
No. PCB is monthly tax deduction. Final income tax is calculated when your annual tax return is prepared.
In many cases, employees may still need to file an annual tax return even if PCB has already been deducted.
You may receive a refund if your PCB paid is higher than your final tax payable.
No. This guide is for general information only. For official tax matters, refer to the relevant authority or a qualified tax professional.
© 2026 Malaysia Salary Tools
Home | About Us | Contact Us | Privacy Policy