BrioHR Help Center

PART A: New Tax Rates (YA 2023)
There are important updates regarding the deduction amount for PCB (Monthly Tax Deduction). These changes are expected to have a significant impact on any payrolls that are currently in the draft stage and future payrolls for the year 2023 within BrioHR.

To view the new Tax Rate for Assessment Year 2023, please refer to the LHDN website by clicking here.

To help you prepare for these changes, here are some general guidelines to keep in mind:

If the Total Annual Income is:
1. RM 48,000 & below, you may not see a change in the PCB deductions.

2. RM 48,000 - RM 400,000 & below = you may see a decrease in the PCB deductions.
3. RM 400,000 & above = you may see an increase in the PCB deductions.
*Note: The information provided above assumes that the employee is unmarried and has no dependent children. Tax implications for employees may differ depending on their marital status and whether they have dependents. Employees who are married and/or have dependent children will have a lower taxable income and thus lower PCB.

However, due to the previous PCB deducted from employees’ salaries in the first few months of the year, there are two potential outcomes for the difference in PCB deductions:

1. Employees who have experienced a decrease in PCB may have even lower PCB deductions than before (as they have already paid a higher PCB amount earlier in the year.)

2. Conversely, employees who have experienced an increase in PCB may have even higher PCB deductions than before (as they have paid a lower PCB amount earlier in the year.)

What to expect when you are running payroll for year 2023? 

Below are a few examples to help you understand how this could work for you.
*Note: The below examples are a comparison between PCB for year 2022 vs PCB for year 2023 with the new tax rates.

Example 1:

Monthly Salary = RM 4,000/month 

Total Annual Income = RM 48,000/year

PCB for YA 2022: RM 200/12 months = RM16.70 (rounded to nearest 5 cents)

PCB for YA 2023 = RM 200/12 months = RM 16.70 (rounded to nearest 5 cents)

Example 2: 

Monthly Salary = RM 5,000/month 

Total Annual Income = RM 60,000/year

PCB for YA 2022 = RM 1,560/12 months = RM 130.00

PCB for YA 2023 = RM 1,320/12 months = RM 110.00

Example 3:

Monthly Salary = RM 40,000/month 

Total Annual Income = RM 480,000/year

PCB for YA 2022 = RM 100,200/12 months = RM 8,350.00

PCB for YA 2023 = RM 100,820/12 months = RM 8,485.00

Note: If you wish to further verify the PCB deduction amount, you may cross-check using the LHDN PCB Calculator by clicking here.

*Note: If you're processing a draft payroll or reopening payroll in Malaysia for the year 2023, you will notice a banner that says "refresh due to tax changes" as per the sample screenshot sample below:

If you decide to refresh the data, please note that the payroll will be updated to reflect the most recent Malaysia tax rates and reliefs. This will also impact employees with data or payroll settings changes.

To refresh the payroll, click on Refresh All, and then click on the Confirm button to complete the action. Otherwise, click Cancel to maintain your current payroll calculations without applying the new tax table updates.

PART B: Changes to Tax Relief (YA 2023)

Recently, the Malaysian government has made some changes to the tax relief policies. 

One notable change is the increase in the maximum tax relief for Medical Treatment Expenses from RM 8,000 to RM 10,000. 

Additionally, two tax reliefs items have now been removed:

1. First, is the removal of tax relief for Domestic Tourism Expenditure. 
[Previously, taxpayers were allowed to claim up to RM 1,000 for such expenses.]

2. Second, is the removal of tax relief for Lifestyle expenses (purchase of computers, smartphones, or tablets for personal use). 
[Previously, taxpayers were allowed to claim up to RM 2,500.]

Kindly refer to the updated tax reliefs in the following forms:
a. TP1 (Section C): BORANG PCB/TP1 (1/2023) 
b. TP3 (Section D): BORANG PCB/TP3 (1/2023)

*Note: If an employee has already claimed the removed tax reliefs above via the TP3 form or TP1 tax reliefs in payroll, the employee will see a slight increase in their PCB to account for the removal of those tax reliefs. 

Have questions? Reach out to our friendly Support team via chat or email (support@briohr.com) for assistance!