EPF, SOCSO, EIS & PCB: The 2026 Statutory Deductions Cheat Sheet for Malaysian Employers
2026 rates, wage ceilings and deadlines for EPF, SOCSO, EIS, LINDUNG 24 Jam and PCB, each linked to the KWSP, PERKESO or LHDN source.
TL;DR — Malaysian employers deduct and remit EPF (KWSP), SOCSO (PERKESO), EIS and PCB every month, all due by the 15th of the following month. Three things changed recently and catch employers out: the SOCSO/EIS wage ceiling is RM6,000 (since 1 Oct 2024), EPF is mandatory for non-citizen employees at 2% + 2% (from October 2025 wages), and PERKESO’s LINDUNG 24 Jam scheme adds a 0.75% employee-only deduction from the June 2026 contribution month.
Every figure below links to the KWSP, PERKESO, LHDN or HRD Corp document it comes from. Rates change, so check the linked source before you run payroll.
The contributions at a glance
| Contribution | Employer | Employee | Wage ceiling | Due |
|---|---|---|---|---|
| EPF (citizens and PRs under 60) | 13% (wages RM5,000 or less) / 12% (above RM5,000) | 11% | None | 15th of following month |
| EPF (aged 60 and above) | Minimum 4% | 0% | None | 15th of following month |
| EPF (non-citizen employees) | 2% | 2% | None | 15th of following month |
| SOCSO Category 1 (under 60) | 1.75% | 0.5% | RM6,000 | 15th of following month |
| SOCSO Category 2 (60 and above) | 1.25% | — | RM6,000 | 15th of following month |
| LINDUNG 24 Jam (SKBBK) | — | 0.75% | RM6,000 | 15th of following month |
| EIS (aged 18 to 60) | 0.2% | 0.2% | RM6,000 | 15th of following month |
| PCB / MTD | — | Per LHDN schedule or formula | — | 15th of following month |
| HRD Corp levy (10+ Malaysian employees) | 1% | — | — | 15th of the month |
Sources: KWSP mandatory contribution, PERKESO contributions, PERKESO LINDUNG 24 Jam FAQ, LHDN employer responsibilities, HRD Corp FAQ.
PCB is the employee’s own income tax. The employer adds nothing, but must deduct it correctly and remit it.
EPF (KWSP)
What are the EPF rates in 2026? For Malaysian citizens and permanent residents under 60, the employer pays 13% on monthly wages of RM5,000 or less and 12% above RM5,000; the employee pays 11% (KWSP).
- Employees aged 60 and above: the employee share is 0% and the employer share is a minimum of 4%, in force since January 2019 wages (KWSP).
- Non-Malaysian citizen employees: contributions are mandatory at 2% employer + 2% employee, starting with October 2025 wages (paid by 15 November 2025). Domestic servants are excluded (KWSP statement). It is no longer opt-in.
What counts as wages? Under the EPF Act 1991, wages include bonuses, commissions and allowances. Service charge, overtime, gratuity, retirement benefit and travelling allowance are excluded (KWSP).
⚠️ Common mistake #1: Treating a bonus as non-wage. Bonuses attract EPF.
How to remit: submit and pay through the KWSP employer portal (i-Akaun Majikan) by the 15th of the following month. Late payment attracts a late payment charge; see KWSP for the current rules.
SOCSO (PERKESO)
What is the SOCSO ceiling? Contributions are capped at an assumed monthly wage of RM6,000, raised from RM5,000 on 1 October 2024 (PERKESO).
- Category 1 (employees under 60): Employment Injury + Invalidity. 1.75% employer, 0.5% employee.
- Category 2 (employees who have reached 60): Employment Injury only. 1.25%, paid by the employer.
SOCSO is not a flat percentage. PERKESO publishes a wage-band table, and you must use the amount in the band. The top band (wages above RM5,900, including anything above RM6,000) under the current Act 4 table:
| Top band (wages above RM5,900) | Employer | Employee (Invalidity) | Employee (LINDUNG 24 Jam) | Total |
|---|---|---|---|---|
| Category 1 | RM104.15 | RM29.75 | RM44.65 | RM178.55 |
| Category 2 | RM74.40 | — | RM44.65 | RM119.05 |
⚠️ Common mistake #2: Keeping an employee on Category 1 after they reach 60. From then, the employer contributes under Category 2 only.
LINDUNG 24 Jam (new from June 2026)
What is LINDUNG 24 Jam? It is PERKESO’s Non-Employment Injury Scheme (Skim Kemalangan Bukan Bencana Kerja, SKBBK). It covers accidents outside work, 24 hours a day. It took effect on 1 June 2026, from the June 2026 contribution month (paid by 15 July 2026) (PERKESO FAQ).
- Paid entirely by the employee; the employer deducts and remits it. There is no employer share.
- Rate: 0.75% (1 Jun 2026 to 31 May 2028), 1.00% (1 Jun 2028 to 31 May 2031), 1.25% (from 1 Jun 2031), on wages up to the RM6,000 ceiling.
- Mandatory for all employees covered by Act 4, local and foreign. There is no age limit.
- PERKESO gave employers a six-month grace period from penalties after the scheme took effect.
How to remit: SOCSO contributions are reported on Borang 8A, the monthly contribution form, and paid through PERKESO’s ASSIST portal by the 15th of the following month. LINDUNG 24 Jam is paid in the same way as the existing PERKESO deductions (PERKESO FAQ).
EIS (Employment Insurance System)
What is the EIS rate? 0.2% employer + 0.2% employee, for employees aged 18 to 60. Employees aged 57 and above with no contributions before 57 are exempt (PERKESO).
EIS uses the same RM6,000 ceiling. The maximum is RM11.90 employer + RM11.90 employee (RM23.80 total) for wages above RM5,900 (PERKESO Act 800 table).
⚠️ Common mistake #3: Still capping SOCSO and EIS at RM5,000. The ceiling has been RM6,000 since 1 October 2024, so anyone earning above RM5,000 has been under-deducted if the old table is still in use.
PCB (MTD — Monthly Tax Deduction)
What is PCB? It is the employee’s monthly income tax, which you deduct using LHDN’s Schedule of MTD or the computerised calculation method, and remit to LHDN on or before the 15th of the following month (LHDN).
- LHDN publishes the formula each year: see the 2026 MTD computerised calculation specification.
- The calculation takes account of the employee’s reliefs (for example EPF and life insurance, which share a combined cap), zakat and the individual rebate. Use the employee’s TP1/TP3 forms and LHDN’s calculator to check any case.
Allowances that are often coded wrong. LHDN lists which allowances and perquisites are tax-exempt, and up to what limit, in its notes to Part F of Form EA. Two examples:
| Component | Treatment |
|---|---|
| Petrol, travelling or toll allowance for official duties | Exempt up to RM6,000 a year (combined) |
| Childcare allowance (children up to 12) | Exempt up to LHDN’s annual limit; check the current figure in the notes |
| Bonus, director’s fees, most other cash allowances | Taxable |
| Benefits in kind (e.g. company car) | Taxable at LHDN’s prescribed values |
The calendar
| When | What | Source |
|---|---|---|
| 15th of every month | EPF, SOCSO + LINDUNG 24 Jam, EIS, PCB and the HRD Corp levy | KWSP, PERKESO, LHDN, HRD Corp (linked above) |
| Within 30 days of a new employee starting | e-CP22 (online only since 1 Sep 2024) | LHDN |
| At least 30 days before employment ends | CP22A / CP22B | LHDN |
| At least 30 days before an employee leaves Malaysia for more than 3 months | CP21 | LHDN |
| Last day of February | Form EA to every employee | LHDN Form E notes |
| 31 March | Form E (employer’s return) with CP8D | LHDN Form E |
Two related rules
- Minimum wage: RM1,700 a month under the Minimum Wages Order 2024, from 1 February 2025 for employers with five or more employees (and all professional-activity employers), and from 1 August 2025 for everyone else.
- HRD Corp levy: registration is compulsory with 10 or more Malaysian employees (levy 1% of wages) and optional with 5 to 9 (levy 0.5%) (HRD Corp FAQ).
Don’t do this by hand
Calculating these by hand is one of the highest-error parts of running a Malaysian SME. The SOCSO category changes when an employee reaches 60, the EPF rate changes when wages cross RM5,000, and LINDUNG 24 Jam is a new line on every payslip.
IntBooks, currently in closed beta, includes a payroll module that calculates EPF, SOCSO, EIS and PCB inside the same system as your accounts, using the RM6,000 SOCSO/EIS ceiling. During the beta, the age-60+ EPF rates, EPF for non-citizen employees and LINDUNG 24 Jam are not yet calculated automatically, so check those employees by hand. If you’d rather hand the whole job over, see our payroll service.