Malaysia PCB guide 2026
Learn how PCB monthly tax deduction works in Malaysia, including how it is calculated, what affects PCB amount and how it relates to annual income tax.
PCB Quick Summary
PCB, or Potongan Cukai Bulanan, is Malaysia's Monthly Tax Deduction (MTD) system. Employers deduct estimated income tax from employees' remuneration and remit it to HASiL through monthly payroll.
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What Is PCB?
PCB stands for Potongan Cukai Bulanan, or Monthly Tax Deduction (MTD). It is a system where employers deduct estimated income tax from employees' remuneration and remit the amount to HASiL on behalf of the employee.
PCB helps spread income tax payments across the year instead of requiring the employee to settle the whole tax amount only after annual filing.
Who May Have PCB Deducted?
PCB generally arises when an employee's estimated tax position produces a monthly tax deduction under the official MTD calculation method. Not every employee will necessarily have PCB deducted.
For employees with lower taxable income, the calculated PCB may be nil after considering the applicable tax treatment, deductions and relief information used in payroll. This is why an employee can still have EPF, SOCSO and EIS deductions while having no PCB for a particular month.
How PCB Works in Malaysia
PCB is calculated from payroll information and is designed to estimate the employee's income tax position progressively during the year.
| Factor | How It Affects PCB |
|---|---|
| Monthly Remuneration | Higher taxable remuneration generally increases the estimated annual tax and monthly PCB. |
| Accumulated Remuneration | Year-to-date income is relevant because PCB uses cumulative information in computerized calculation. |
| EPF Contribution | Eligible EPF deductions are taken into account subject to the applicable PCB calculation rules and limits. |
| Tax Deductions / Rebates | Approved deductions and rebates reflected through payroll may reduce PCB. |
| Bonus / Additional Remuneration | Additional remuneration is calculated separately under the PCB computerized method and can cause a higher deduction in that month. |
| Tax Residency / Special Tax Treatment | The applicable tax treatment can materially change the monthly deduction. |
How PCB Is Calculated
PCB is calculated using HASiL's Monthly Tax Deduction rules and 2026 computerized calculation specification. The calculation considers normal remuneration, accumulated remuneration and deductions, accumulated PCB, applicable relief information and tax rates.
Additional remuneration such as bonus is handled using a specific additional-remuneration calculation rather than simply dividing estimated annual tax by 12.
Simple PCB Example: RM5,000 Monthly Salary
A RM5,000 monthly salary does not automatically produce one universal PCB amount because the deduction can differ according to the employee's tax profile and payroll information.
| Monthly salary | RM5,000 |
| Annualised employment income | Used as part of the tax estimation |
| EPF / eligible deductions | Considered under the applicable PCB rules |
| Personal / family information | May affect allowable deductions and rebates |
| Final monthly PCB | Determined using HASiL's approved calculation method |
What Can Increase or Reduce PCB?
Your PCB amount can change when your income or tax information changes. This is why PCB may be different from one month to another.
Higher Income
Salary increments and additional taxable remuneration can increase PCB.
Bonus & Commission
Additional remuneration may trigger a higher PCB deduction in the payment month.
Deductions & Reliefs
Eligible items reflected correctly for PCB purposes may reduce the deduction.
Personal Information
Relevant spouse, child and other tax information may affect the calculation where applicable.
PCB for Bonus, Commission and Additional Remuneration
Bonus, commission and other additional remuneration can increase PCB because they increase taxable employment income. Under HASiL's computerized method, additional remuneration has a specific calculation procedure.
This is why an employee may see a much higher PCB deduction in a bonus month even though the normal monthly PCB is relatively low.
Tax Reliefs, Deductions and Form TP1
Eligible deductions and rebates can affect PCB when they are properly declared and processed under the applicable HASiL rules. Form TP1 is used by employees to claim qualifying deductions and rebates for Monthly Tax Deduction purposes.
If an employee had previous employment during the same year, Form TP3 is used to provide the new employer with accumulated remuneration, EPF, zakat and PCB information from previous employment so that the current-year PCB calculation can take that information into account.
| Form | Main Purpose |
|---|---|
| TP1 | Employee claim for qualifying individual deductions and rebates for PCB purposes. |
| TP3 | Current-year previous-employment information used for PCB calculation by the new employer. |
PCB vs Annual Income Tax
PCB is not a separate tax. It is a monthly payment toward the employee's income tax position.
| Item | Meaning |
|---|---|
| PCB / MTD | Monthly income tax deduction through payroll. |
| Income Tax Return | Annual declaration of income, deductions, reliefs and final tax position where filing is required. |
| Tax Refund | May arise when tax paid or deducted exceeds the final tax liability. |
| Additional Tax Payable | May arise when total tax paid or deducted is lower than the final tax liability. |
PCB vs EPF, SOCSO and EIS
EPF, SOCSO and EIS are statutory payroll contributions or social protection deductions, while PCB is a monthly income tax deduction. All can affect take-home pay, but they serve different purposes.
| Deduction | Main Purpose | Employee Take-Home Pay? |
|---|---|---|
| EPF | Retirement savings | Reduced by employee contribution |
| SOCSO | Social security protection | Reduced by employee contribution |
| EIS | Employment insurance | Reduced by employee contribution |
| PCB | Monthly income tax payment | Reduced by PCB deducted |
Why PCB Can Change From Month to Month
PCB can change when salary changes, a bonus or commission is paid, previous-employment information is added, tax deduction information is updated or payroll has additional remuneration to process.
A higher PCB in one month does not automatically mean the payroll calculation is wrong. The correct amount depends on the employee's accumulated current-year tax position and the applicable MTD calculation rules.
PCB, Tax Refund and Additional Tax Payable
After the relevant year ends, the taxpayer's final tax position can be compared with tax already paid through PCB.
| Situation | Possible Result |
|---|---|
| Total tax paid through PCB is higher than final tax liability | A tax refund may arise. |
| Total PCB is lower than final tax liability | Additional tax may need to be paid. |
| Total PCB broadly matches final tax liability | There may be little or no remaining balance. |
PCB Payment Deadline for Employers
Employers must deduct PCB from employee remuneration and remit the PCB to HASiL on or before the 15th day of the following month.
| Deduction Month | Payment Deadline |
|---|---|
| January 2026 | On or before 15 February 2026 |
| February 2026 | On or before 15 March 2026 |
HASiL provides e-PCB, e-Data PCB and e-CP39 through MyTax / ezHasil for PCB submission.
- Calculate PCB using an approved method
- Deduct the correct amount from remuneration
- Submit employee PCB data
- Remit payment by the deadline
Common PCB Payroll Mistakes
- Assuming PCB is a fixed percentage of monthly salary.
- Ignoring previous-employment information during the same calendar year.
- Forgetting that bonus and other additional remuneration require specific PCB treatment.
- Using outdated employee deduction or rebate information.
- Confusing PCB with EPF, SOCSO or EIS.
- Assuming PCB deducted each month will always equal the employee's final annual tax liability.
Sources & Verification
This guide was last verified in August 2026 against current HASiL employer guidance and the 2026 computerized Monthly Tax Deduction specification. Actual PCB calculations should follow the latest official HASiL rules, forms and approved calculation methods.
HASiL — PCB Schedule & 2026 Computerized Calculation Specification
HASiL — PCB Submission & Payment
HASiL — Employer Responsibilities
HASiL — Official Website
Frequently Asked Questions
What is PCB in Malaysia payroll?
PCB, or Potongan Cukai Bulanan, is Malaysia's Monthly Tax Deduction system. Employers deduct the calculated amount from employee remuneration and remit it to HASiL toward the employee's income tax.
Is PCB a fixed percentage of salary?
No. PCB is calculated using HASiL's approved MTD method and depends on the employee's remuneration, accumulated current-year information, deductions, rebates and other relevant tax factors.
Is PCB the same as income tax?
PCB is not a separate tax. It is a monthly payment toward the employee's income tax position.
Why is my PCB different from another employee with the same salary?
Employees with the same salary can have different PCB because their accumulated income, previous employment, deductions, rebates, personal information or additional remuneration may differ.
Does bonus affect PCB?
Yes. Bonus and other additional remuneration can increase PCB and are subject to a specific additional-remuneration calculation under the computerized MTD method.
What is Form TP1 used for?
Form TP1 allows an employee to claim qualifying individual deductions and rebates for Monthly Tax Deduction purposes, subject to HASiL rules.
What is Form TP3 used for?
Form TP3 provides the current employer with accumulated remuneration, EPF, zakat and PCB information from previous employment during the same year for PCB calculation purposes.
Will I get a tax refund if PCB is too high?
A tax refund may arise when tax already paid through PCB exceeds the taxpayer's final tax liability, subject to the final tax assessment and filing requirements.
When must employers pay PCB to HASiL?
PCB deducted for a month must generally be remitted on or before the 15th day of the following month.
Can PCB be treated as final tax?
In certain circumstances, eligible taxpayers may choose not to submit an income tax return when all HASiL conditions for PCB as final tax are satisfied.