Malaysia income tax 2026

Malaysia's income tax runs from 0% to 30% for a resident, in ten bands, and is a flat 30% with no reliefs for a non-resident, generally someone present for under 182 days in the year. On a salary of RM60,000, a Malaysian pays RM1,320 for year of assessment 2026; on RM120,000, RM11,150, against RM36,000 for a non-resident. The sum uses the RM9,000 individual relief and the EPF relief capped at RM4,000. The scale comes from the 2026 specification of LHDN, the Malaysian tax authority, read on 3 November 2026. Budget 2027 proposes a RM12,000 relief and new bands, which would bring that RM120,000 down to RM10,060. One limit to know about: the SOCSO and EIS rates could not be read on any official page, so the net figure leaves them out.

Income tax due

RM11,150

From salary to Malaysian income tax, step by step
Reliefs applied	RM13,000
Chargeable income	RM107,000
Tax on the scale	RM11,150
Tax rebate	RM0
EPF at 11%	RM13,200
Net a month, before SOCSO and EIS	RM7,971

SOCSO and EIS are not deducted: we could not read their rates on any official page, so real net pay is slightly lower. The 2027 option uses Budget proposals, not a verified law.

How we calculate

The 2026 resident scale

Malaysian tax scale by income band
Chargeable income	Rate
RM0 – RM5,000	0%
RM5,000 – RM20,000	1%
RM20,000 – RM35,000	3%
RM35,000 – RM50,000	6%
RM50,000 – RM70,000	11%
RM70,000 – RM100,000	19%
RM100,000 – RM400,000	25%
RM400,000 – RM600,000	26%
RM600,000 – RM2,000,000	28%
Above RM2,000,000	30%

What that means by salary

Tax and net pay at several salaries
Gross salary	Tax, then net after EPF
RM36,000	RM0net RM32,040
RM60,000	RM1,320net RM52,080
RM120,000	RM11,150net RM95,650
RM240,000	RM41,150net RM172,450
RM500,000	RM107,020net RM337,980
RM1,000,000	RM244,760net RM645,240

Malaysian or permanent resident, year 2026, EPF at 11%, before SOCSO and EIS. Our own calculation from LHDN documents.

The resident scale, band by band

Nothing up to RM5,000 of chargeable income, then 1% to RM20,000, 3% to RM35,000, 6% to RM50,000, 11% to RM70,000, 19% to RM100,000, 25% to RM400,000, 26% to RM600,000, 28% to RM2 million and 30% above. The tax authority gives an example on Form BE: on RM45,500 chargeable, RM600 on the first RM35,000 and RM630 on the rest, or RM1,230.

LHDN publishes this scale for 2023 to 2025. For 2026 its page does not repeat it, and it can be read in the withholding calculation specification and in the current position set out by Budget 2027: those two documents give the same bands.

Reliefs and the RM400 rebate

The RM9,000 relief applies automatically. EPF contributions earn RM4,000 at most. SOCSO and EIS give a relief of up to RM350, which the calculator does not count, since it cannot work out those contributions. Budget 2026 changes eligible spending: childcare raised to RM3,000, a new RM1,000 tourism relief. The calculator has an optional field for other reliefs so you can add them.

If chargeable income does not exceed RM35,000, tax falls by another RM400. The Form BE note says "does not exceed", while the heading of one LHDN page says "less than": we follow the former, which cites the statute.

Foreigners: what changes

Under 182 days of presence in the year generally means non-resident status, but Public Ruling 2/2026 points out that adjacent years can count. A non-resident pays 30% on every ringgit, with no reliefs. Employment exercised for 60 days or fewer in the year can be exempt under conditions, according to the same ruling.

The EPF rate for foreign employees could not be read on the EPF's official site, which refused our requests. The calculator therefore does not deduct it, and your payslip may show a line for it.

Budget 2027 is not yet your scale

The Budget 2027 tax measures propose, from year of assessment 2027, 18% instead of 19% between RM70,001 and RM100,000, a new 24% band between RM100,001 and RM150,000, a 30% rate from RM1 million and an individual relief of RM12,000. We have not checked whether these measures are enacted. The calculator shows them separately and keeps 2026 as the default year.

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Questions

How much tax on a RM120,000 salary in Malaysia?

RM11,150 for a Malaysian or permanent resident, year of assessment 2026, with the RM9,000 and RM4,000 reliefs. A non-resident would pay RM36,000, or 30% with no reliefs. Other reliefs, such as childcare or medical costs, lower the result, and the calculator lets you add them to your own sum.

At what income do you start paying tax in Malaysia?

The scale takes nothing on the first RM5,000 of chargeable income. After the RM9,000 relief and EPF, a Malaysian employee therefore starts to owe on the scale once salary passes about RM15,700. Since the RM400 rebate applies up to RM35,000 chargeable, the final tax stays at zero well above that.

How many days make you tax resident in Malaysia?

The basic test is 182 days in the year: below that you are generally non-resident, according to LHDN Public Ruling 2/2026. The law also extends residence through adjacent years, notably with linked periods of 182 days and stays of 90 days. On this point the ruling refers to Public Ruling 11/2017.

Are SOCSO and EIS deducted in this calculation?

No. The SOCSO site did not respond to our requests, and we do not use a rate seen only in a search excerpt. Your real net pay will therefore be slightly lower than the figure shown. The tax documents only confirm the RM350 relief on these contributions. Your payslip remains the best reference.

Sources

Published by Radif Partners

Independent publisher of international tax comparisons built from official tax tables

Updated on November 3, 2026 · Editorial policy · Contact

Figures 2026, checked on November 3, 2026