Glossary
Plain-language definitions for the terms you'll see across this site and on your payslip.
Gross salary
Everything your employer agrees to pay you before any deduction — your base pay plus fixed allowances, but not one-off reimbursements like travel claims.
Net salary (take-home pay)
What actually lands in your bank account after EPF, SOCSO, EIS and PCB have been deducted from your gross salary.
EPF (KWSP)
The Employees Provident Fund — a mandatory retirement savings scheme. Both you and your employer contribute a percentage of your wage into an account that's yours, invested and paid out when you retire (or in specific approved circumstances earlier).
SOCSO (PERKESO)
The Social Security Organisation. It runs two schemes for employees below 60 (Employment Injury and Invalidity Pension) and one for those 60 and above (Employment Injury only), covering workplace accidents, occupational disease and permanent disability.
EIS (SIP)
The Employment Insurance System. A small monthly contribution that funds temporary financial help and job-search assistance if you're retrenched or lose your job involuntarily.
PCB / MTD
Potongan Cukai Bulanan, or Monthly Tax Deduction — the amount your employer withholds each month as an advance payment toward your annual income tax, based on LHDN's formula.
Chargeable income
Your annual income after subtracting all the tax reliefs you qualify for. This is the figure the progressive tax table is actually applied to — not your gross salary.
Tax relief
An amount LHDN lets you subtract from your income before tax is calculated, to recognise specific spending or circumstances (like having children, buying insurance, or medical costs).
Tax rebate
Unlike a relief (which reduces the income being taxed), a rebate is subtracted directly from the tax bill itself, and only applies below a certain chargeable income threshold.
Wage ceiling
The maximum wage amount that SOCSO and EIS contributions are calculated on. Earn more than the ceiling, and your contribution stops increasing — it's capped at the ceiling amount.
Statutory rate
A contribution or tax rate set by law (via KWSP, PERKESO or LHDN), as opposed to a rate your employer chooses voluntarily.
Employer contribution
The portion of EPF, SOCSO and EIS that your employer pays on your behalf, on top of your salary — it doesn't reduce your take-home pay.
Resident vs non-resident (tax)
A tax status based on how many days you're physically in Malaysia in a year — not your nationality. Residents get the progressive tax table and reliefs; non-residents are taxed at a flat rate with no reliefs.