PCB Calculator Malaysia (MTD 2026)

What Is PCB (Potongan Cukai Bulanan)?

PCB, also called Monthly Tax Deduction (MTD), is the Malaysian payroll tax withheld by employers each month and remitted to the Inland Revenue Board (LHDN) by the 15th of the following month. The system, administered under the Income Tax Rules 1994, ensures employee income tax is collected throughout the year rather than as a single lump sum. PCB approximates the employee's projected annual tax liability based on monthly income, marital status, and registered reliefs, then divides it across 12 months. The annual tax filing (Form BE) reconciles total PCB paid against actual tax owed and refunds any overpayment.

Employers calculate PCB using LHDN's MTD Computerised Calculation Method or the published MTD Schedule. The MTD Schedule covers three category codes: Category 1 (single, not married, no children), Category 2 (married, spouse not working), and Category 3 (married, spouse also working). Each category has different relief amounts that affect the monthly withholding. Employees may file Form TP1 to claim additional reliefs (life insurance, medical, education) so the employer reduces PCB throughout the year — getting tax savings cash flow rather than waiting for a refund.

How PCB Is Calculated — The Annualised Method

The standard PCB calculation projects annualised income from current monthly compensation. Method: take this month's gross income, multiply by 12, subtract annual reliefs (auto-applied based on Category 1/2/3 plus children), apply YA 2026 brackets to get annual tax, divide by 12 to get monthly PCB. When bonuses or one-off payments occur, the calculation uses a "supplementary tax" formula — comparing tax under the projected annualised income with and without the bonus, and withholding the difference. This prevents single large bonus months from being over-taxed.

Self-employed individuals do not have PCB — they pay tax via CP500 instalments throughout the year (semi-annual or monthly schedules) and file a final reconciliation on Form B by June 30. For total tax including reliefs and rebates, see our Malaysia income tax calculator. For SOCSO and EIS deductions that also reduce take-home pay, use SOCSO/EIS calculator.

When PCB Differs from Actual Tax Owed

PCB approximates annual tax but won't match exactly. Common reasons for over-withholding (refund expected): claiming additional reliefs (lifestyle RM 2,500, parents medical RM 8,000, SSPN savings RM 8,000) on Form BE that weren't filed via TP1; receiving end-year reliefs (PRS contributions, life insurance premiums); changing marital status mid-year; or having medical claim reimbursements. Common reasons for under-withholding (top-up payment expected): rental income, freelance side income, or capital gains not subject to PCB. Always file Form BE by April 30 even if your only income was salaried — LHDN cannot otherwise confirm your actual liability.

Reducing PCB Throughout the Year — Form TP1 and TP3

Form TP1 tells your employer about additional reliefs (life insurance, medical insurance, education insurance, child education) so PCB is reduced from that point forward. Form TP3 reports prior employment income to a new employer mid-year, ensuring continuity in PCB calculation. CP38 instructs the employer to deduct extra PCB to cover additional taxable income (e.g., rental). Submit these to your employer's HR/payroll department; they update your monthly PCB starting the next pay run.

Last updated May 2026. Sources: hasil.gov.my (LHDN), MTD Computer Calculation Method.