Malaysia PCB (monthly tax deduction) or CP500 instalment payments.
Accountant-authored. Written and published by MUHAMMAD HANIS MAT HUSSIN, an accountant approved on OpenAccountants. Their licence number (CA-53636) is published on their profile, so you can check it against the register yourself. No second accountant has attested to this version yet. General reference material, not advice on your specific facts; don't file, pay, or take a position on it without a professional reviewing your situation.
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PCB
PCB is the Malaysian PAYE (Pay As You Earn) system. Employers withhold income tax from employees' monthly remuneration and remit it to LHDN.
CP500
CP500 is the instalment tax payment system for individuals with business or non-employment income. LHDN issues a CP500 notice specifying the amounts and due dates.
Due date rule
The due date is the 15th of the instalment month. If the 15th falls on a weekend or public holiday, the next business day applies.
Rendered from the canonical facts model. General reference only — confirm with a qualified professional before acting.
Quick Reference
| Field | Value |
|---|---|
| Country | Malaysia |
| System | PCB (Potongan Cukai Bulanan) for employees; CP500 for self-employed |
| Currency | MYR (Malaysian Ringgit / RM) |
| Tax year | Calendar year (YA = Year of Assessment) |
| Primary legislation | Income Tax Act 1967, Sections 107-107B; Income Tax (Deduction from Remuneration) Rules 1994 |
| Tax authority | LHDN (Lembaga Hasil Dalam Negeri) |
| Portal | MyTax (https://mytax.hasil.gov.my) |
| Validated by | Pending |
| Validation date | Pending |
| Skill version | 1.0 |
System Overview
| System | Applies To | Frequency | Responsible Party |
|---|---|---|---|
| PCB (Potongan Cukai Bulanan) | Employees | Monthly | Employer deducts and remits |
| CP500 | Self-employed, sole proprietors, partnerships, rental/investment income | Bimonthly (6 instalments/year) | Taxpayer pays directly |
Employer Obligations
| Obligation | Detail |
|---|---|
| Registration | Employer must register with LHDN as an employer |
| Calculation | Use LHDN's PCB Schedule or e-PCB Calculator |
| Deduction | Deduct PCB from employee's monthly salary |
| Remittance | Remit to LHDN by 15th of following month |
| Reporting | Submit Form CP39 with each remittance |
| Annual | Issue Form EA (statement of remuneration) to employees by end of February |
PCB Calculation Factors
| Factor | Detail |
|---|---|
| Monthly remuneration | Salary, allowances, bonuses, commissions |
| Tax reliefs | Employee declares reliefs via Form TP1 |
| EPF deduction | Reduces chargeable income |
| Number of children | Affects relief calculation |
| Marital status | Single / married / spouse with income |
e-PCB
| Item | Detail |
|---|---|
| Portal | https://e.hasil.gov.my/epay (or via MyTax) |
| Submission | Monthly CP39 electronic submission |
| Payment | Online banking, FPX, or manual payment at LHDN counter |
| Deadline | 15th of the month following salary payment |
Who Receives CP500
| Category | Obligation |
|---|---|
| Sole proprietors (business income) | Mandatory |
| Partners in partnerships | Mandatory (based on share of partnership income) |
| Individuals with rental income | May receive CP500 |
| Individuals with investment income | May receive CP500 if significant |
| First-year businesses | May not receive CP500 until first Form B is filed |
LHDN calculates CP500 based on:
Basis of CP500
| Basis | Detail |
|---|---|
| Prior year tax liability | LHDN uses the latest assessed or estimated tax from the prior Form B |
| Standard uplift | LHDN may increase by 5-10% to account for expected income growth |
| New businesses | Based on estimated income declared in Form B or registration |
CP500 is payable in 6 bimonthly instalments:
Payment Schedule
| Instalment | Month | Due Date |
|---|---|---|
| 1st | March | 15 March |
| 2nd | May | 15 May |
| 3rd | July | 15 July |
| 4th | September | 15 September |
| 5th | November | 15 November |
| 6th | January (following year) | 15 January |
Payment Methods
| Method | Detail |
|---|---|
| Online banking (FPX) | Via MyTax portal or ByrHASiL |
| Bank counter | Using CP500 payment slip with reference number |
| ATM / CDM | Selected banks |
| Direct debit | Can be arranged with LHDN |
How to Revise
| Method | Detail |
|---|---|
| Form CP502 | Application to revise CP500 instalments |
| Submission deadline | By 30 June of the YA (i.e., before the 4th instalment) |
| Portal | Submit via MyTax or LHDN branch |
| Effect | LHDN revises remaining instalments; amounts already paid are credited |
Revision Rules (Section 107B(3))
| Rule | Detail |
|---|---|
| Underestimation penalty | If revised estimate is >30% below actual tax, a 10% penalty applies on the difference (Section 107B(3)) |
| Cannot revise after 30 June | Remaining instalments must be paid as per last revision |
| Increase voluntarily | Taxpayer can always pay more than the CP500 amount |
Late Payment (Section 107B(2))
| Situation | Penalty |
|---|---|
| CP500 instalment not paid by due date | 10% increase on the unpaid amount (Section 107B(2)) |
| Persistent non-payment | LHDN may take enforcement action (garnishee, travel restriction) |
Underestimation (Section 107B(3))
| Situation | Penalty |
|---|---|
| Revised CP500 estimate is >30% below actual tax liability | 10% penalty on the difference between actual and estimated tax (Section 107B(3)) |
| No revision filed but significant underpayment | Penalty at assessment stage |
Employer PCB Penalties
| Situation | Penalty |
|---|---|
| Failure to deduct PCB | Employer is personally liable for the amount |
| Late remittance | 10% increase on late amount |
| Failure to furnish Form EA | Fine up to RM20,000 or imprisonment up to 6 months |
Situation: Graphic designer, YA 2024 tax liability was RM8,400. LHDN issues CP500 for YA 2025 based on this amount.
CP500 schedule: 6 × RM1,400 = RM8,400 total
Actual YA 2025 tax liability: RM10,200. Balance of RM1,800 due upon filing Form B (30 June 2026).
Situation: Consultant expects income to drop significantly. Revised estimate: RM4,500 tax for the year.
Action: Submits Form CP502 by 30 June 2025. Remaining 3 instalments reduced. Already paid RM4,200 (3 × RM1,400). New instalments: RM100 each for Jul, Sep, Nov.
Risk: If actual tax turns out to be RM7,000, difference from revised estimate (RM7,000 - RM4,500 = RM2,500) is >30% of actual (30% × RM7,000 = RM2,100). Since RM2,500 > RM2,100, a 10% penalty on RM2,500 = RM250 may apply.
Interaction with Other Systems
| System | Interaction |
|---|---|
| Form B filing | CP500 paid is credited against final tax liability on Form B |
| EPF/SOCSO/EIS | See my-epf-socso skill; these are separate from income tax instalments |
| Section 108 (withholding) | Tax withheld by payer on certain payments is also credited against final tax |
Key Sections of ITA 1967
| Topic | Reference |
|---|---|
| Employer PCB | Section 107; Income Tax (Deduction from Remuneration) Rules 1994 |
| CP500 instalments | Section 107B |
| Revision of estimate | Section 107B(3); Form CP502 |
| Penalties | Sections 107B(2), 107B(3), 112 |
LHDN Resources
| Resource | URL |
|---|---|
| MyTax portal | https://mytax.hasil.gov.my |
| PCB calculator | https://e.hasil.gov.my |
| CP500 payment | ByrHASiL via MyTax |
| Contact | 03-8911 1000 |
This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon.
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