Working in Kuching
Income Tax Deduction
It is compulsory for all expatriates to pay income tax in the following circumstances:
- 1. Resides in Malaysia for less than 60 days – Income tax is waived.
- 2. Resides in Malaysia for 60 days or more but less than 182 days – Income tax rate at 26%.
- 3. Resides in Malaysia for more than 182 days, continuously or in total – Income tax rate will be based on the Scheduler Tax Deduction (STD).
The table below shows the basic tax rate based on STD:
| Salary Range (per annum) | Tax Rate % |
|---|---|
| 2,501 – 5,000 | 1 |
| 5,001 – 20,000 | 3 |
| 20,001 – 35,000 | 7 |
| 35,001 – 50,000 | 12 |
| 50,001 – 70,000 | 19 |
| 70,001 – 100,000 | 24 |
| 100,001 – 250,000 | 26 |
| > 250,000 | 26 |
The University will deduct the monthly income tax directly from the staff member’s monthly salary and remit the amount to the Inland Revenue Board (IRB) on the staff’s behalf. Please note that the monthly tax deductions using the STD table are estimated tax deduction only. Staff members must declare their yearly income by completing the form BE, which will be sent by the IRB early in each year. The form must be submitted to IRB within the stipulated time period. Any under or over-tax payment will be adjusted during the yearly assessment.
For more information, you can visit www.hasil.gov.my
Employee Provident Fund
The Employee Provident Fund (EPF) has been set up by the Malaysian government to cater for retirement. It is compulsory for each employer and employee to contribute to the fund. However, it is an option for an expatriate to contribute. The current contribution rate is 11% for the employee and 12% for the employer. The contribution rate may be amended from time to time. The money is refunded to the employee on cessation of employment and on leaving the country.
For more information, you can visit www.kwsp.gov.my