PCB / MTD (LHDN)

Last updated: July 9, 2026

Doing this in Cloudby?
This is the rules reference. For how it works in the software, see Statutory Contributions in the reference, or the how-to Run payroll.

PCB (Potongan Cukai Bulanan), also called MTD (Monthly Tax Deduction), is income tax withheld from salary each month and paid to LHDN on the employee’s behalf. It is a prepayment of the employee’s annual tax, not a separate charge.

How PCB is worked out

There is no single percentage. PCB is computed per employee from LHDN’s MTD formula, which takes gross remuneration, less EPF (capped) and other allowable deductions, spread over the remaining months of the year, and applies the individual tax rates with the employee’s relief and rebate entitlements. Cloudby runs this calculation on every payroll.

What affects the amount

  • Personal reliefs and rebates the employee declares (form TP1): lifestyle, medical, education, zakat and the rest.
  • Marital status and spouse/children relief (form TP2 / employee particulars).
  • Prior employment in the same year (form TP3), so the year-to-date position is correct when someone joins mid-year.
  • Bonuses and one-off pay, which are spread under the formula rather than taxed in a single spike.

Remittance

PCB withheld in a month is paid to LHDN with the CP39 return by the 15th of the following month, usually via the e-PCB / e-Data PCB channel. Cloudby produces the CP39 data from your run: see Statutory Forms.

Year-end

PCB feeds the annual picture: each employee’s EA statement shows total remuneration and PCB deducted, and the employee reconciles it in their own tax return. See Deadlines & annual filing.

Always confirm the current figures. Rates, wage ceilings and dates change from time to time. This page reflects the position as of mid-2026; verify the current schedule with LHDN (IRBM) before you rely on a number.

Related