Overview: The Four Deductions
Every Malaysian employee in the private sector has four statutory deductions removed from their gross salary before they receive their take-home pay. Three of them benefit the employee directly; one prepays a tax obligation.
EPF (KWSP)
Employees Provident Fund / Kumpulan Wang Simpanan Pekerja
Employee rate
11%
Employer rate
12–13%
Salary cap
No cap
Purpose
Retirement savings in your personal EPF account. Earns annual dividends (~5–6%). You own all contributions.
Benefit goes to
You (into your EPF account)
Tip
Verify monthly via KWSP i-Akaun app. Employer must remit by 15th of next month.
SOCSO (PERKESO)
Social Security Organisation / Pertubuhan Keselamatan Sosial
Employee rate
~0.5% (tiered table)
Employer rate
~1.75% (tiered table)
Salary cap
Capped at RM5,000 salary
Purpose
Two schemes: Employment Injury (workplace accidents, occupational diseases) and Invalidity (permanent disability). Provides medical, disability, and survivors' benefits.
Benefit goes to
You, if you suffer a workplace injury or permanent disability
Tip
Register on PERKESO Assist portal to check contribution history and file claims.
EIS (SIP)
Employment Insurance System / Sistem Insurans Pekerjaan
Employee rate
0.2%
Employer rate
0.2%
Salary cap
Capped at RM5,000 salary
Purpose
Temporary income replacement and job-seeking support if you are retrenched, constructively dismissed, or your employer closes. Benefits include job loss allowance, career counselling, and training.
Benefit goes to
You, if you lose your job involuntarily (retrenchment, VSS, company closure)
Tip
File EIS claims within 60 days of job loss on the EIS portal (eismy.com.my). You are eligible after 6 months of EIS contributions.
PCB / MTD
Potongan Cukai Berjadual / Monthly Tax Deduction
Employee rate
Varies (based on LHDN schedule)
Employer rate
0 (employer remits your portion)
Salary cap
No cap
Purpose
Monthly prepayment of your annual income tax to LHDN. Amount depends on salary, marital status, and TP1 declarations. Reconciled when you file annual return (Borang BE).
Benefit goes to
LHDN (refunded to you if overpaid at year-end)
Tip
Submit TP1 to employer to reduce monthly PCB if you have reliefs (insurance, education, children).
Employer vs Employee Contributions — Who Pays What
A key distinction: your employer has obligations of their own that are in addition to your salary, not deducted from it:
- EPF employer contribution (12–13%): Paid on top of your salary. A RM5,000/month employee costs the employer RM5,650–RM5,750/month total, before SOCSO and EIS.
- SOCSO employer contribution (~1.75%): Also paid by the employer.
- EIS employer contribution (0.2%): Matched by employer.
PCB is different — it is entirely your income tax, and the employer simply acts as a collection agent, remitting your deducted amount to LHDN. The employer has no cost here.
What Your Employer Is Legally Required to Do
- Deduct and remit EPF contributions by the 15th of the following month. Late payment attracts a 6% per annum penalty.
- Deduct and remit SOCSO contributions by the last day of the following month.
- Deduct and remit EIS contributions by the last day of the following month.
- Deduct PCB (MTD) monthly and remit by the 15th of the following month. Employers must provide EA Forms (Form EA) by 28 February each year showing total remuneration and PCB.
- Issue payslips showing all deductions. Employers must maintain payroll records for at least 7 years.
How to Check Your Contributions Are Correct
- EPF: Log in to i-Akaun (MyKWSP app) and check monthly contribution history. Employer name, contribution amount, and date should all match your payslip.
- SOCSO: Use the PERKESO Assist portal to verify contributions.
- EIS: Check via EIS portal (eismy.com.my) or PERKESO (EIS is administered by PERKESO).
- PCB: Your annual EA Form shows total PCB remitted. Cross-check against your LHDN MyTax account.
If your employer is not remitting the correct amounts, you can report to EPF, PERKESO, or LHDN respectively. Non-compliance is a criminal offence under the respective acts.
See Your Full Payslip Breakdown
Enter your salary to instantly see EPF, SOCSO, EIS, and PCB amounts — plus your net take-home pay.
Related Guides
- How to Calculate Take-Home Salary After EPF — full worked example
- PCB vs Income Tax Malaysia
- How PCB Tax Works in Malaysia
- PTPTN Repayment Guide Malaysia — PTPTN is not a payslip deduction but counts toward your DSR; understand your total obligations
- Salary Calculator Malaysia