Summary of changes to PCB Calculations for year 2016

Summary of changes to PCB Calculations for year 2016

There are several changes to 2016 PCB calculations set by LHDN this. Below is a summary of the changes that affect pcb calculations in Malaysian payroll software when upgrading from 2015 to 2016. (Click here for Malay Translation)  

2015

2016

Maximum income tax rate 25%Maximum tax rate increased to 26% and 28%. 28% rate for individuals with income exceeding 1 million
Non – resident individuals’ income tax rate is 25%Non – resident individuals’ income tax rate increased to 28%
Deduction for spouse whose has no income or pays an alimony to his former wife = RM3,000Deduction for spouse whose has no income or pays an alimony to his former wife = RM4,000
Deduction of RM1,000 for each child below 18 years of age.Deduction for each child below 18 years of age doubled to RM2,000.
Deduction For Children studying at tertiary level = RM6,000Deduction For Children studying at tertiary level increased to RM8,000
Deduction for disabled child receiving further instruction at diploma level onwards in an institution of higher education RM12,000
Deduction for disabled child receiving further instruction at diploma level onwards in an institution of higher education increased to RM14,000.
Deduction on fees for tertiary education = RM5,000Deduction on fees for tertiary education increased to RM7,000.
No Deduction for SOCSOEligible to claim a deduction up to a maximum of RM250 per year on the contribution to SOCSO.
No Deduction for Parental CareNew personal deduction of RM1,500 pre parent provided no claim for expenses on medical treatment and care of parents
For arrears payment related to the prior year (other than current year), employer should submit MTD amount by using CP39A text file format.With effect from 2016, gross income from an employment receivable in respect of any
particular period shall be taxed in the year it is received.
The CP 39A text file format is irrelevant.
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