There are 2 ways to calculate PCB:

  • Non-Computerized Calculation

  • Computerized Calculation

Non-Computerized Calculation

For non-computerized calculation, you can refer to Table of Monthly Tax Deduction below:
http://lampiran1.hasil.gov.my/pdf/pdfam/Jadual_PCB_2018.pdf

Computerized Calculation
The MTD calculation depends on the resident status of the employee.
There are 2 types of residency as follows:

a. Non Resident Employee
MTD of an employee who is not resident or not known to be resident in Malaysia shall be calculated at the rate of 30 % of his remuneration.

Example :
Employee is not resident in calendar year 2020.
Total monthly remuneration : RM3,000.00
MTD calculation : RM3,000.00 x 30%
Total MTD : RM900.00

b. Resident Employee
MTD of an employee who is resident or known to be resident in Malaysia is derived after deducting all allowable deductions under the Act.

MTD formula are categorized into four (4) formulas. The employer may change the category of remuneration based on the approval from the IRBM.
The formula are:
i. Computerised calculation for Normal Remuneration
ii. Computerised calculation for Additional Remuneration
iii. Computerised calculation for Returning Expert Program
iv. Computerised calculation for Knowledge worker at specified region (ISKANDAR)

i. COMPUTERISED CALCULATION FOR NORMAL REMUNERATION
“Normal remuneration” means fixed monthly remuneration paid to the employee whether the amount paid is fixed or variable as specified in the contract of service in writing or otherwise;
If the employee has no salary and only receives a commission, the commission paid is consideredas remuneration.
If the monthly salary is paid on a daily or hourly basis, the total monthly salary paid is considered asremuneration.
If the monthly salary changes due to the change in currency values, the total monthly salary paid is also considered as remuneration.
The amount of Monthly Tax Deduction based on Computerised Calculation is determined in accordance with the following formula:

Note:
There is an amendment of the tax rate value of P, M, R and B for MTD Computerised Calculation for 2018, please refer to this link for the details.

ii. COMPUTERISED CALCULATION FOR ADDITIONAL REMUNERATION
 “Additional Remuneration” means any additional payment to the normal remuneration for the current month paid to an employee whether in one lump sum, periodical, in arrears or non-fixed payment.
 Such additional remuneration includes: 

  • bonus/incentive

  • arrears of salary  or any other arrears paid to an employee

  • employee’s share option scheme (if employee opts for MTD deduction)

  • tax borne by employer

  • gratuity

  • compensation for loss of employment

  • ex-gratia

  • director’s fee (not paid monthly)

  • commissions (not paid monthly)

  • allowances (not paid monthly)

  • any other payment in addition to normal remuneration for current  month

Note:  
With effect from 2016, gross income from an employment receivable in respect of any particular period shall be taxed in the year it is received. The requirement to relate the employment income to the particular period is removed.
 
Therefore, PCB should calculate based on current year additional remuneration formula and reported together with current month’s PCB in CP39 text file format. The CP 39A text file format is irrelevant.  

The amount of Monthly Tax Deduction for additonal remuneration based on Computerised Calculation is determined in accordance with the following formula:
 
Step 1 – Determine the Monthly Tax Deduction on net normal remuneration for a year.
 
[A] Determine the category of the employee.
 
[B] Determine the chargeable income for a year, not including additional remuneration for the current month, in accordance with the formula specified in subparagraph c(i), where P = [∑(Y - K*) + (Y1 – K1*) + [(Y2 – K2*) n] + (Yt – Kt*)**] - [D + S +  DU + SU + QC + (∑LP + LP1)].
 
[C] Determine the Monthly Tax Deduction for net normal remuneration for the current month in accordance with the formula  c(i) = [(P – M) R + B] – (Z + X)] / (n + 1)
 
Upon the value of P being determined, the value of M, R and B are determined based on Table 1.  
 
[D] Determine the net Monthly Tax Deduction for the current month = Monthly Tax Deduction for the current month (Step [C]) ― zakat for the current month, if any.
 
[E] Determine the total Monthly Tax Deduction for a year  = X + [Step [C] x (n + 1)]
X is the accumulated Monthly Tax Deduction which has been paid;
n + 1 is the balance of month in a year, including the current month.   

Step 2 – Determine the chargeable income for a year, including the additional remuneration for the current month.
 
[A] Determine the category of the employee.
 
[B] Determine the chargeable income for a year in accordance with the formula specified in (i), where P = [∑(Y - K*) + (Y1 – K1*) + [(Y2 – K2*) n] + (Yt – Kt*)**] - [D + S +  DU + SU + QC + (∑LP + LP1)].
 
Step 3 – Determine the total tax for a year.
 
Total tax for a year =  (P – M) R + B
 
Value of P is determined based on Step 2[B];
Value of M, R and B are determined based on Table 1.
 
Step 4 – Determine the Monthly Tax Deduction for additional remuneration for the current month.
 
Monthly Tax Deduction for additional remuneration for the current month
                                                                   =  
Total tax for a year (Step 3) ― total Monthly Tax Deduction for a year (Step 1[E]) + zakat which has been paid.

Step 5 – Determine the Monthly Tax Deduction for the current month which shall be paid.   

Monthly Tax Deduction for the current month which shall be paid
                                                                  =  
Net Monthly Tax Deduction (Step 1[D]) + Monthly Tax Deduction for additional remuneration for the current month (Step  4) 

iii. COMPUTERISED CALCULATION FOR RETURNING EXPERT PROGRAM (REP)  
 
An approved employee under REP shall be tax at rate of 15% from its chargeable income. If the chargeable income does not exceed RM35,000, employee is eligible for individual and spouse rebate for RM400, respectively.
 
Duration of the incentive is for five (5) consecutive full years of assessment.
 
For the Returning Expert Programme, the amount of Monthly Tax Deduction based on Computerised Calculation is determined in accordance with the following formula: 

iv. COMPUTERISED CALCULATION FOR KNOWLEDGE WORKER (KW) AT SPECIFIED REGION  (ISKANDAR)
 
Tax rate at 15% is charged to the qualified knowledge worker who is working and residing in a specified region.
 12
 
The incentive is given to the applicant and start work in Regional Development Authority not later than 31 December 2015.
 
For the knowledge worker in a specified region, amount of Monthly Tax Deduction based on Computerised Calculation is determined in accordance with the following formula: 

Term and Conditions
For the detail of term and condition, please find on below article:
https://intercom.help/hreasilyfaq/malaysia-contribution-and-tax/monthly-tax-deduction/term-and-condition-on-pcb-calculation-biks-perquisites-deductions


Source:

http://lampiran1.hasil.gov.my/pdf/pdfam/Spesifikasi_Kaedah_Pengiraan_Berkomputer_PCB_2020.pdf




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