Kalkulator Gaji Sejam

How PCB, EPF, SOCSO and EIS Work in Malaysia

Every hourly or daily wage in Malaysia is built on the Ordinary Rate of Pay (ORP): monthly basic wage ÷ 26 ÷ 8 under the Employment Act 1955, or the contracted hourly rate itself for workers already paid that way. The national minimum wage floor is RM1,700 a month, which works out to an ORP of roughly RM8.17 an hour — any hourly rate below that on a full-time schedule falls short of the legal minimum.

PCB (Potongan Cukai Bulanan, literally 'monthly tax deduction') is how Malaysia collects income tax through payroll instead of a single annual bill. Employers withhold PCB using LHDN's monthly schedule, applying the same progressive bands used at annual filing — 0% on the first RM5,000 of chargeable income, then 1%, 3%, 6%, 11%, 19%, 25% and 26%, up to 28% above RM600,000 — after the standard RM9,000 personal relief and EPF relief are applied.

EPF (Employees Provident Fund, or KWSP in Malay) is the mandatory retirement scheme: employees contribute 11% of gross wages, and employers add 12% (or 13% if the employee earns RM5,000 or less a month). Since May 2024, 10% of the employee's own contribution is automatically routed into a separate Akaun Fleksibel (Account 3), which can be withdrawn at any time for emergencies rather than being locked up until retirement.

SOCSO (PERKESO) and EIS sit alongside EPF as smaller but compulsory contributions. SOCSO covers workplace injury and invalidity protection at 0.5% employee / 1.75% employer, while EIS (Employment Insurance System) funds unemployment benefits at 0.2% each side. Both are calculated on wages up to a RM72,000-a-year ceiling, so the SOCSO and EIS deduction stops growing well before EPF or PCB does for higher earners.

Worked Example: From Hourly Rate to Net Pay and Employer Cost

Take a retail assistant in Kuala Lumpur on RM15.00 an hour — comfortably above the RM8.17 ORP implied by the RM1,700 minimum wage — working a standard 45-hour week (the Employment Act 1955 cap on normal hours) plus 5 hours of overtime most weeks. Averaged over 4.33 weeks, that comes to about 195 normal hours and 22 overtime hours in a typical month.

1. Normal pay: 195 hours × RM15.00 = RM2,925.00
2. Overtime pay (1.5x under the Employment Act 1955): 22 hours × RM15.00 × 1.5 = RM495.00
3. Gross monthly pay: RM2,925.00 + RM495.00 = RM3,420.00
4. EPF employee (11%): RM3,420.00 × 11% = RM376.20
5. SOCSO employee (0.5%): RM3,420.00 × 0.5% = RM17.10
6. EIS employee (0.2%): RM3,420.00 × 0.2% = RM6.84
7. Estimated PCB (monthly tax deduction) on this income, after the RM9,000 annual personal relief and EPF relief: roughly RM32.60
8. Net take-home pay: RM3,420.00 − RM376.20 − RM17.10 − RM6.84 − RM32.60 ≈ RM2,987.26
9. EPF employer (13%, since monthly wage is at or below RM5,000): RM3,420.00 × 13% = RM444.60
10. SOCSO employer (1.75%): RM3,420.00 × 1.75% = RM59.85
11. EIS employer (0.2%): RM3,420.00 × 0.2% = RM6.84
12. Total employer cost: RM3,420.00 + RM444.60 + RM59.85 + RM6.84 ≈ RM3,931.29 a month — about RM511 more than the gross wage the worker actually sees

Overtime and Minimum Wage Under the Employment Act 1955

The Employment Act 1955 caps normal working hours at 8 hours a day and 45 hours a week. Anything beyond that on a normal working day must be paid at 1.5x the ORP. Work on a rest day is paid at up to 2x depending on hours worked, and work on a public holiday is paid at 2x for the normal hours plus 3x for any overtime hours worked beyond that — among the highest statutory overtime premiums in the region.

The RM1,700 national minimum wage, in force across Peninsular Malaysia, Sabah, Sarawak and Labuan since 1 August 2025, sets the floor the ORP itself must clear. Because so many workers are paid hourly or daily rather than a fixed monthly salary, it is the ORP formula — not a monthly figure — that actually gets checked against the minimum wage in practice.

• 1.5x ORP for overtime on a normal working day
• Up to 2x ORP for work on a rest day
• 2x ORP for normal hours plus 3x ORP for overtime hours on a public holiday
• RM1,700/month national minimum wage (≈RM8.17/hour ORP-equivalent), effective nationwide since 1 August 2025
• Employers who under-pay overtime or the minimum wage remain liable even if the worker agreed to a lower rate — the Employment Act's minimum protections cannot be waived by contract

The True Cost of Employing Someone in Malaysia

Quoting an hourly rate to a new hire tells only part of the cost story. On top of gross wages, Malaysian employers are statutorily required to contribute:

• EPF/KWSP: 12% of gross wages, rising to 13% for employees earning RM5,000 or less a month
• SOCSO (PERKESO): 1.75% of gross wages, capped at a RM72,000 annual wage ceiling
• EIS: 0.2% of gross wages, on the same RM72,000 annual ceiling
• Combined, these employer-side contributions typically add 12–15% on top of gross pay for wages at or below the RM5,000/month EPF threshold — meaningfully more than the headline hourly rate an employer thinks it is paying

Why Your PCB Refund (or Shortfall) Surprises So Many Workers

PCB is deducted every month as an estimate — LHDN's schedule assumes that month's pay repeats for the full year, so a one-off bonus, a raise partway through the year, an overtime-heavy month, or a job change all throw that estimate off. None of this is a payroll error; it is simply how a monthly-deduction system approximates an annual liability.

The reconciliation happens once a year, when every employee files a Form BE (or Form B for business income) with LHDN, usually by 30 April for the previous tax year. If total PCB withheld across the year was more than the actual tax owed, the difference comes back as a refund; if it was less — common after a bonus, a big overtime month, or a raise late in the year — the worker has to pay the shortfall directly. Treating PCB as a running estimate rather than a final bill is the single biggest source of confusion this calculator can clear up, simply by showing both the monthly PCB figure and how it fits into the annual PCB bands.