1. What is PCB (Potongan Cukai Bulanan)?

Definition: PCB is the Monthly Tax Deduction system in Malaysia where employers deduct income tax from employees' salaries each month.

Purpose: It helps employees pay their income tax gradually throughout the year rather than in a lump sum.

2. How Does the PCB Calculation Work?

The calculator uses the formula:

Where:

• \( PCB \) — Monthly tax deduction (RM)
• \( P \) — Total monthly salary (RM)
• \( M \) — Monthly tax relief (RM)
• \( R \) — Tax rate (%)
• \( B \) — Additional tax (RM)
• \( Z \) — Zakat/Fi (RM)
• \( X \) — Tax rebate (RM)
• \( n \) — Number of months (typically 12)

Explanation: The formula calculates taxable income after reliefs, applies the tax rate, adjusts for additional taxes and rebates, then spreads the annual tax equally over the months.

3. Importance of PCB Calculation

Details: Accurate PCB calculation ensures proper tax compliance, avoids underpayment penalties, and helps with personal financial planning.

4. Using the Calculator

Tips: Enter your monthly salary, applicable reliefs, tax rate, and other components. The calculator will determine your monthly PCB deduction.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical tax rate (R) for PCB?
A: Tax rates vary from 0% to 30% based on your annual taxable income bracket according to LHDN's tax schedule.

Q2: What are common tax reliefs (M)?
A: Common reliefs include EPF contributions, life insurance, medical insurance, and lifestyle expenses (up to certain limits).

Q3: Why is n+1 used in the denominator?
A: This accounts for the current month's deduction plus spreading the remaining tax over the rest of the year.

Q4: How often should PCB be recalculated?
A: Whenever there are changes in salary, reliefs, or tax status (marriage, children, etc.).

Q5: What if my PCB calculation is zero?
A: If your taxable income is below the minimum threshold after reliefs, no PCB will be deducted.