Dive into articles that cover fundamental concepts and best practices on payroll management in Malaysia.
What are the overtime rates according to the Employment Act?
The provisions in this article apply to employees covered under the overtime sections of the Employment Act (including any employees whose monthly wages do not exceed RM4,000, as well as employees engaged in or supervising manual labour irrespective of wages). Different rates apply depending on whether the work is performed on normal work days, rest […]
How to determine residence status?
Determination of Malaysia Residence Status Generally, residence status for tax purposes is based on the number of days spent by the individual in Malaysia and is independent of citizenship. (Note that spending part of a day in Malaysia counts as being physically present for the whole day – for example, someone who arrives in Malaysia […]
Malaysian Payroll Overview
Let’s have a go at describing Malaysian payroll in 200 words… For each employee, you start with gross salary for the month. Then you need to deduct tax, pension and social security contributions to get to the net monthly salary: PCB: monthly tax deductions based on provisional annual income and with a progressive tax rate […]
What is the difference between a foreigner and a non-resident for payroll purposes?
SOCSO Foreign employees contribute under the Employment Injury Scheme. Only employer contributions are payable. You will require the employee’s SSFW number to make the contributions. EPF Foreign employees are not required to contribute, but may choose to do so. This is also independent of tax residency. Please refer to this article to find out more on the EPF contribution […]
How to pay an employee leaving my company?
Salary Payout After Termination When an employee resigns or is terminated, certain payments like Severance pay, Payment in lieu of notice and Leave pay may become payable. Severance pay When an employee is terminated, they may be paid severance pay. Severance pay is exempt from EPF and SOCSO/EIS. In addition any part of the severance pay which is […]
How do I register as an employer?
As an employer – whether a company, sole proprietor, partnership, association or other – you must register with EPF, SOCSO, LHDN, and – for employers with at least 10 full-time Malaysian employees – HRDF. EPF According to Section 41(1) of the EPF Act 1991, an employer shall register with the EPF within 7 days from […]
Employment Act Amendments from 1 January 2023
The Employment (Amendment) Act 2022 came into force on 1 January 2023. Here is a breakdown of the main changes which may affect your business. Who is now covered under the Employment Act? The most far-ranging changes to the Employment Act, which were actually enacted under the separate Employment (Amendment of First Schedule) Order 2022, concern the expansion […]
