What are the statutory deductions for payroll in Malaysia?

Every monthly payroll in Malaysia must account for EPF (KWSP), SOCSO and EIS (PERKESO), the new SKBBK contribution from June 2026, and PCB — the monthly income-tax deduction (MTD) remitted to LHDN.

When are EPF, SOCSO, EIS and PCB due?

Contributions and PCB for a given month are generally due by the 15th of the following month — EPF to KWSP, SOCSO/EIS to PERKESO, and PCB to LHDN. Late payment attracts penalties from each authority.

What are the EPF rates?

For citizens and PRs under 60: employee 11%, employer 13% (12% above RM5,000 monthly). Citizens 60+: employee 0%, employer 4%. Foreign workers: 2% each (from October 2025).

Do I need payroll software to run payroll in Malaysia?

Not strictly, but software removes the risk of mis-calculating EPF, SOCSO, EIS, SKBBK and PCB each month, generates payslips and statutory files, and keeps records for audit. AccountMi automates all five for every employee.

How to run payroll in Malaysia (2026)

Last reviewed: 14 June 2026

Running payroll in Malaysia means getting five statutory items right every month — EPF, SOCSO, EIS, the new SKBBK contribution, and PCB. Here is what each is, the current rates, when they are due, and how a monthly run works.

The five statutory deductions

EPF (KWSP) — retirement savings. Under 60: employee 11%, employer 13% (12% above RM5,000). Citizens 60+: 0% / 4%. Foreign workers: 2% each. EPF calculator →
SOCSO & EIS (PERKESO) — SOCSO employee 0.5% / employer 1.75% (Category 1); EIS 0.2% each; both capped at RM6,000. SOCSO & EIS calculator →
SKBBK (Lindung 24 Jam) — new employee-only 0.75% from 1 June 2026, on wages up to RM6,000.
PCB / MTD — monthly income tax for LHDN, based on annualised pay, reliefs and category. PCB calculator →

Employer deadlines

Contributions and PCB for a given month are generally due by the 15th of the following month — EPF to KWSP, SOCSO and EIS to PERKESO, and PCB to LHDN. The first SKBBK remittance (for June 2026 wages) is due by 15 July 2026. Missing a deadline attracts penalties from the relevant authority, so most businesses run payroll a few days before month-end.

A monthly payroll run, step by step

Confirm each employee’s gross pay, allowances and any bonus for the month.
Calculate EPF, SOCSO, EIS and SKBBK on the relevant wage bases.
Calculate PCB using reliefs (personal, spouse, children) and any bonus.
Produce payslips showing gross, each deduction and net pay.
Pay salaries, then remit contributions and PCB by the 15th of the next month.
File the statutory contribution files (KWSP, PERKESO, LHDN) and keep records.

Want the net figure first? Try the salary calculator to see take-home pay and full employer cost for any salary.

Frequently asked questions

What are the statutory deductions for payroll in Malaysia?: Every monthly payroll in Malaysia must account for EPF (KWSP), SOCSO and EIS (PERKESO), the new SKBBK contribution from June 2026, and PCB — the monthly income-tax deduction (MTD) remitted to LHDN.
When are EPF, SOCSO, EIS and PCB due?: Contributions and PCB for a given month are generally due by the 15th of the following month — EPF to KWSP, SOCSO/EIS to PERKESO, and PCB to LHDN. Late payment attracts penalties from each authority.
What are the EPF rates?: For citizens and PRs under 60: employee 11%, employer 13% (12% above RM5,000 monthly). Citizens 60+: employee 0%, employer 4%. Foreign workers: 2% each (from October 2025).
Do I need payroll software to run payroll in Malaysia?: Not strictly, but software removes the risk of mis-calculating EPF, SOCSO, EIS, SKBBK and PCB each month, generates payslips and statutory files, and keeps records for audit. AccountMi automates all five for every employee.

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