What is PCB (MTD) 

  • PCB is the Malaysian monthly tax deduction - Potongan Cukai Bulanan. These monthly tax deductions are retained by your employer and paid over to the LHDN. PCB is designed to avoid the issues that come with requiring payment of a large sum at the end of the year.

How is PCB calculated in altHR

  • altHR PCB calculation is based on the tax table set by LHDN. There are a couple of values needed in order to obtain an accurate PCB calculation as per below:

  1. Updated employee income tax profile (Resident status, Marital status, Employee Disabled Status, Spouse Disabled Status, Number of children eligible for relief)
  2. Previous month's salary 
  3. Previous month's EPF contribution 
  4. Previous month's PCB amount (If any)
  5. Previous month tax relief deduction (If any)
  6. Current month's salary
  7. Current month's EPF contribution 
  8. Current month's tax relief deduction

While the formula can be summarised as follows:

  1. Annual taxable income = Previous months salary + (recurring and non-recurring taxable pay items in monthly salary) + Current month salary * Number of months remaining in the year. 

  2. Annual taxable income - Deductions = Annual chargeable income

  3. The annual tax is then calculated based on the annual chargeable income based on the LHDN tax table.

  4. PCB = (annual tax - PCB already paid) /Number of months remaining. 

Referring to Point 1 of the formula above, the previous months are in the calculation of taxable income. If you do not put in your previous pay run data then our system will not be able to ensure accuracy in calculating the PCB amount. Here's how to upload previous pay runs