The following article takes a detailed look at 3 methods that can be used to calculate Bonus PCB.
- Use values generated by E-CP39
- Manual Calculations using formula
- Use the PCB online calculator
Essentially Bonus PCB is calculated this way.
- Calculate the PCB for the basic salary.
- Divide the bonus by 12 and add to basic salary. This step is to estimate what will be the monthly income if bonus was added to annual income.
- Calculate PCB based on new estimated monthly salary including bonus.
- Calculate : bonus salary PCB – Basic Salary
- Multiply this difference in PCB by 12. This is the Bonus PCB.
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Calculations will based on the following parameters Basic Salary : RM5,000 |
|
|---|---|
Method 1 using E-CP39 |
|
| BASIC SALARY | 5,000.00 |
| EPF = 550.00 | |
| Maximum allowed EPF deduction per month for 2025 is RM333 (2025 rules : Max EPF deduction per annum RM4000 / 12) |
(333.00) |
| Taxable Income | 4,667.00 |
|
PCB for 5,000 |
110.05 |
| Bonus | 5,000.00 |
| EPF | 1,100.00 |
| Maximum allowed EPF deduction per month for 2020 is RM333 EPF allowance already exceeded. Balance deduction is zero. |
0.00 |
| Taxable Bonus Income (5,000 – 0) | 5,000.00 |
| Monthly estimated salary with bonus | |
| Basic + (Taxable Bonus)/12 months | |
| 4,667.00 + (5,000 / 12) = 4667 + 416.66 | 5,083.66 |
|
PCB for 5,083.66 |
143.45 |
| Tax difference between Income with Bonus minus Income without bonus | |
| Total PCB – Basic PCB (143.45 – 110.05) | 33.40 |
| PCB for Bonus = Extra PCB x 12 (4.95 x 12) | 400.80 |
| Total PCB for month = Bonus PCB + Basic PCB (110.05+400.80) | 510.85 |
Method 2 – Manual PCB calculation for Bonus using PCB Formula
Step 1 – PCB for Basic Pay using Formula
Taxable Amount for current month = RM5,000–RM333.33 = RM4,667.00
Step 2 – Use formula to calculate P for Basic Pay
P = [(Y – K) x 12] + [Σ(Yt1 – Kt1)] + (Yt – Kt) – (D + S + QC)
Y = Basic Income and K = EPF deducted for basic income.
Yt1 and Kt1 are not applicable as accumulated (YTD) values are not used in manual calculations.
Yt = additional income and Kt = EPF deducted for additional income.
Y = 5,000
K = 333.33 (4,000 / 12) – Limit per annum for EPF deduction is 4,000. It used to be 6,000 in previous years )
Yt = 5,000
Kt = 0, since maximum EPF of 333.33 already deducted.
D = personal deduction = 9,000
S = spouse deduction = 0 for spouse not working
Q = No. of children, C = deduction per child = 0.
P = [(Y – K) x 12] + [Σ(Yt1 – Kt1)] + (Yt – Kt) – (D + S + QC)
= [(RM5,000–RM333.33) x 12] + [RM0.00 – RM0.00] +[RM0 – RM0]
– [RM9,000 + RM0 + RM0]
= RM56,000.04 + RM0 + RM0 – RM9,000
= RM47,000.04
(D = personal deduction 9000, S = 0, spouse, C = No. of Children = 0)
Step 3 – Calculate Total Tax for Basic Pay
PCB Calculation Table 2025
| P (RM) | M (RM) | R (%) | B Category 1 & 3 (RM) | B Category 2 (RM) |
| 5,001 – 20,000 | 5,000 | 1 | – 400 | – 800 |
| 20,001 – 35,000 | 20,000 | 3 | –250 | –650 |
| 35,001 – 50,000 | 35,000 | 6 | 600 | 600 |
| 50,001 – 70,000 | 50,000 | 11 | 1,500 | 1,500 |
Total tax for a year = [(P – M) R + B]
= [(RM47,000.04 – RM35,000) x 6% + RM600]
= RM12,000.04 x 6% + RM600
= RM720.00 + RM600
= RM1,320.00
P, M, R and B are derived from the Income tax table, based on P = (35,000 – 50,000)
PCB for Current month = 1,320.00 / 12 = 76.66 = 110.00
Step 4 – Calculate Total Tax for Basic Pay + Bonus
P = [(Y – K) x 12] + [Σ(Yt1 – Kt1)] + (Yt – Kt) – (D + S + QC)
= [(RM5,000–RM333.33) x 12] + [RM0.00 – RM0.00] +[RM5,000 – RM0]
– [RM9,000 + RM0 + RM0]
= RM56,000.04 + RM5000 – RM9,000
= RM52,000.04
(D = personal deduction 9000, S = 4,000, spouse, C = No. of Children = 2 x 2000)
Step 5 – Calculate Total Tax for Basic Pay + Bonus
Total tax for a year = [(P – M) R + B]
= [(RM52,000.04 – RM50,000) x 11% + RM1,500]
= RM2,000.04 x 11% + RM1,500
= RM220.00 + RM1,500
= RM1,720.00
Step 4 – PCB for Bonus ( Additional Remuneration )
Annual (PCB for Basic + Bonus – PCB for Basic)
Bonus PCB = RM1,720.00 – RM1,320.00 = RM 400.00
Step 5 – Total PCB for current month
= RM110.00 + RM 400.00
= RM510.00
Method 3 Bonus PCB Calculation using Online LHDN PCB Calculator
There are 2 options in using the online PCB calculator:
- PREVIOUSLY EMPLOYED IN CURRENT YEAR
- PREVIOUSLY NOT EMPLOYED IN CURRENT YEAR
If you are using MTD schedule for your monthly PCB calculations, use “PREVIOUSLY NOT EMPLOYED IN CURRENT YEAR”. There are 2 reasons for this.
- You do not have to enter Y-T-D information
- This will simulate the MTD Schedule values, because it does not take into account Y-T-D information.
Basic : 5,000, EPF = 550 ( You can insert the actual EPF as long as the total EPF is below 4,000. The online calculator will automatically calculate the real values)
Bonus : 5,000, EPF = 1,100 ( You can insert the actual EPF as long as the total EPF is below 4,000. The online calculator will automatically calculate the real values)
Using the Online PCB Calculator the total PCB for the month = 510.00
The MTD of bonus (additional income) = 800.08 => 800.10
Basic PCB = RM110.00
Variations between the 3 Methods
| Basic PCB | Bonus PCB | Basic + Bonus PCB | |
| PCB Schedule | 110.05 | 400.80 | 510.85 |
| Direct Calculations | 110.00 | 400.00 | 510.00 |
| Using Online Calculator | 110.00 | 400.00 | 510.00 |
Discrepancy between calculations using the 3 methods.
As can be seen the discrepancy between the calculations is very minor. The PCB Schedule based calculation has a larger variation of almost RM0.85 due to rounding used in creating the PCB Table.
If this is still too difficult, you can download our free Trial version of Actpay which can be run for 40 days. Enough to do Bonus calculations for January and February 2019.
Conclusion
In conclusion, it has to be noted that there are multiple ways to calculate PCB and some of the methods can be quite tedious. Considering the work involved and the high chance of errors in the calculation, it is recommended that the calculations be done very carefully. To avoid errors it is recommended that a payroll software be used.
The most common mistake in bonus calculations is the not including the basic salary and monthly allowances while calculating bonus. The bonus PCB is the PCB on the amount additional to the monthly gross income.
Although we have tried to make the example as simple as possible, it may still be quite difficult to understand. If you have any questions, please post a comment here or ask a question under “Q&A” and we will try our best to answer.
The following article explains the differences between paying Bonus separately and paying bonus together with the basic pay.
The following article explains how bonus calculations are done in Actpay