Ever wondered what all the breakdown in your payslip means? You’re not alone. I am 30+ years of age, and I still don’t 100% understand my payslip.
Here’s an example of a Malaysian payslip I got from the internet:
In this article, we’ll focus on 2 parts that matter the most in your Malaysian payslip:
- Your mandatory deductions (to know your net take-home-pay)
- Your company contribution (perks of being a full-time employee)
Your Compulsory Salary Deductions
Here are all the stuff that is automatically deducted from your salary each month:
Employee EPF (Forced Retirement Savings)
EPF is a compulsory retirement savings, so all working Malaysians would have some sort of savings for their retirement.
9% out of your salary will be deducted and contributed into your KWSP. Your employer will also contribute according to the table below:
When I started working for a few months, my EPF accumulated quite a lot. That amount would take me many years to save by myself.
Pretty cool concept as the employer contributes to my retirement fund.
Accident & Life Insurance — SOCSO or PERKESO
SOCSO or PERKESO means the same thing in 2 different languages:
- SOCSO = Social Security Organization
- PERKESO = Pertubuhan Keselamatan Sosial
It is the Malaysian employee insurance. You, or your family should be able to claim for this insurance if you have any work related medical and accident claims.
Contribution Rate: 0.5% from your salary will be deducted, and your employer will also contribute another 1.75% into this insurance scheme. Pretty good coverage if you ask me.
I think more Malaysians need to know their rights and protection that’s already in place. Pretty good system we have going on here.
Monthly Tax Deductions (MTD)
Income tax calculations are never easy and straightforward. There’s so many types of incomes, and tax deductions. Everyone will be paying a different amount.
- To see your yearly income tax according to your bracket, click here.
- To make your life easier, use this yearly income tax calculator.
Your Monthly Tax Deductions (MTD) will depend on how much you’re making. You can refer to this table. This amount will be useful if you’re doing your monthly budgeting.
Loss of Job Insurance — Employment Insurance System (EIS)
The Employment Insurance System is an insurance that will pay you a certain percentage of your last salary for up to 6 months if you were ever to lose your job or had to leave your job voluntarily for your own safety.
The capped salary that is being covered for this insurance is RM 4,000. The contributions for this scheme are:
- Your contribution to EIS: 0.2%
- Your employer’s contribution to EIS: Another 0.2%
Click here for their payment schedule and calculator.
HRDF (Employer Pays for This)
The Human Resource Development Fund (HRDF) does not have anything to do with your personal finances as your employer will pay for this, but it’s good to know what it is:
HRDF is a special fund that all employers must pay for their employees’ training.
Your gross pay minus all the deductions above, will be your take-home-pay (the real amount that will be banked in to your account).
Well, there you have it. Now you get to understand your Malaysian payslip and can see your employee’s benefit.
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Originally published at https://balkonihijau.com.
