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Your first payslip: minimum wage, EPF, SOCSO, EIS and tax
What comes off your first salary in Malaysia in 2026: the RM1,700 minimum wage, EPF at 11%, SOCSO, EIS and income tax, with a fictional RM2,500 payslip worked through line by line.
Reviewed by Mereka staff
Published 24 Oct 2026Next check due 24 Jan 20277 min read31 of 31 facts verified against their sources
The figures, at a glance
What a payslip shows
Your payslip lists three things. Your gross pay is what you earn before anything comes off. Your deductions are the amounts the law says must come off. Your net pay is what lands in your bank account. Your employer also pays into some of the same schemes on top of your salary, so your job costs them more than your gross pay.
The minimum wage
From 1 February 2025, the Minimum Wages Order 2024 set the national minimum wage at RM1,700 a month, or RM8.72 an hour.[1] Employers with fewer than five workers had until 1 August 2025 to pay it, unless they carry out a professional activity.[1] The order does not cover domestic servants.[1]
RM1,700 is still the minimum in October 2026. In the Budget 2027 speech on 9 October 2026, the Government said the minimum wage will rise to RM2,000 from June 2027, with small and medium businesses with yearly sales below RM50 million exempted.[2] It also announced a minimum wage of RM2,500 a month for semi-skilled workers and graduates, "as a starting point", with no start date given.[2] These need a new order before they apply, so check the Ministry of Human Resources before you rely on them.
EPF (KWSP): your retirement savings
If you are a Malaysian under 60, 11% of your wages goes into your EPF account each month. Your employer adds 13% if you earn RM5,000 or less, or 12% if you earn more.[3][4] The money is yours, but most of it is kept for retirement. Employers use the wage bands in the Third Schedule of the EPF Act, so the exact amount can differ by a ringgit from a straight percentage.[4]
Since October 2025 wages, non-Malaysian workers with a work pass (except domestic helpers) also contribute: 2% from the worker and 2% from the employer. Permanent residents, and non-Malaysians who joined EPF before 1 August 1998, stay on the citizen rates.[5] Budget 2027 also says every citizen will be registered as an EPF member automatically at 18.[2]
SOCSO (PERKESO): protection if you get hurt
SOCSO protects you if you are injured at work or can no longer work because of invalidity. Your employer pays most of it. Amounts come from a table of wage bands, and since 1 October 2024 the wage ceiling has been RM6,000 a month.[6] For wages between RM2,400 and RM2,500 in 2026, your employer pays RM42.85 and you pay RM12.25 a month.[7]
From 1 June 2026, a new scheme called LINDUNG 24 Jam added cover for accidents outside work.[8] It is paid only by employees, starting at 0.75% of wages.[9][10] After a Cabinet decision announced on 8 July 2026, it is voluntary for Malaysian workers, while foreign workers must still join.[10][9] At RM2,500 it costs you RM18.35 a month if you choose it.[7] Budget 2027 proposes up to RM150 of extra tax relief for voluntary LINDUNG 24 Jam contributions.[2]
EIS: help if you lose your job
The Employment Insurance System pays a job-search allowance and training support if you lose your job. You and your employer each pay the same small amount from a table: RM4.90 each for wages between RM2,400 and RM2,500, and never more than RM11.90 each once wages pass RM6,000.[11]
Income tax (PCB)
PCB (potongan cukai bulanan, the monthly tax deduction) is income tax your employer takes off and sends to LHDN. Whether you pay depends on your chargeable income: your yearly income minus reliefs.
- Your EPF contributions count for up to RM4,000 of relief, and SOCSO plus EIS for up to RM350.[13]
- The first RM5,000 of chargeable income is taxed at 0%, the next RM15,000 at 1%, and the next RM15,000 at 3% (rates in force in 2026).[12]
- If your chargeable income is RM35,000 or less, you get a RM400 rebate off your tax.[13]
So on a first salary of RM1,700 to RM3,000 a month, the reliefs and rebate usually bring your income tax to zero. Budget 2027 proposes raising the personal relief to RM12,000 from the 2027 year of assessment.[12] It is a proposal until the Finance Bill passes.
A worked payslip (Fictional: for a classroom exercise)
Aina is a fictional Malaysian aged 19. She earns RM2,500 a month gross in 2026.
| Line | Aina pays | Employer pays on top |
|---|---|---|
| Gross pay | RM2,500.00 | |
| EPF | −RM275.00 | RM325.00 |
| SOCSO (Employment Injury + Invalidity) | −RM12.25 | RM42.85 |
| EIS | −RM4.90 | RM4.90 |
| Income tax for the year (our calculation below) | RM0.00 | |
| Net pay | RM2,207.85 |
Her job costs the employer RM2,872.75 a month. The EPF lines come from the RM2,480.01 to RM2,500 row of the EPF Third Schedule.[14] SOCSO and EIS come from the 2026 PERKESO tables.[7][11] Income tax: her chargeable income is about RM17,494 a year (RM30,000 minus the RM9,000 personal relief, RM3,300 of EPF and RM205.80 of SOCSO and EIS), which gives tax of about RM125, and the RM400 rebate wipes it out.[12][13] Her employer works out the actual monthly PCB with LHDN's formula, so check the PCB line on a real payslip. If Aina opts in to LINDUNG 24 Jam, her net pay drops by RM18.35.
For parents and facilitators
The numbers above change often: the minimum wage is due to change in June 2027, LINDUNG 24 Jam changed twice in 2026, and Budget 2027 tax changes need Parliament. Use this as a reading guide, not payroll advice, and check the official tables each term.
What to do next
- Take a real or sample payslip and find gross pay, each deduction and net pay. Check SOCSO and EIS against the PERKESO tables for that wage band.
- When you start work, download the KWSP app and confirm that both your 11% and your employer's share arrive each month.
- Decide, with your family, whether to opt in to LINDUNG 24 Jam, and write down why.
How sure are we?
Each fact or figure in this guide, and how well its sources back it up. Checking evidence is a skill: open a source and see if you agree.
31 of 31 facts verified against their sources
Verified · Its sources say this.
From 1 February 2025 the national minimum wage under the Minimum Wages Order 2024 is RM1,700 a month.
Sources:[1]
Verified · Its sources say this.
Employers with fewer than five employees (other than those carrying out professional activities) had to pay RM1,700 from 1 August 2025.
Sources:[1]
Verified · Its sources say this.
The Minimum Wages Order 2024 does not apply to domestic servants.
Sources:[1]
Verified · Its sources say this.
RM1,700 remains the minimum wage in October 2026 (Budget 2027 refers to raising it from RM1,700).
Sources:[2]
Verified · Its sources say this.
The Government will raise the minimum wage to RM2,000 from June 2027, exempting MSMEs with annual sales below RM50 million.
Sources:[2]
Verified · Its sources say this.
Budget 2027 announced a minimum wage of RM2,500 a month for semi-skilled workers and graduates as a starting point, with no start date stated.
Sources:[2]
Verified · Its sources say this.
From October 2025 wages, non-Malaysian employees with a valid work pass (excluding domestic workers) and their employers each contribute 2% of monthly wages to EPF; permanent residents and those who became members before 1 August 1998 keep the citizen rates.
Sources:[5]
Verified · Its sources say this.
Budget 2027: every citizen will be automatically registered as an EPF member on reaching 18.
Sources:[2]
Verified · Its sources say this.
PERKESO wage ceiling for contributions rose from RM5,000 to RM6,000 a month effective 1 October 2024.
Sources:[6]
Verified · Its sources say this.
For wages above RM2,400 but not above RM2,500, the SOCSO First Category employer share is RM42.85 and the employee Invalidity share is RM12.25.
Sources:[7]
Verified · Its sources say this.
At RM2,400.01-RM2,500 wages, the employee's Non-Employment Injury (LINDUNG 24 Jam) share is RM18.35 a month.
Sources:[7]
Verified · Its sources say this.
LINDUNG 24 Jam contributions are borne fully by employees, phased at 0.75% for the first two years, 1.0% for the next three and 1.25% from year six.
Sources:[9]
Verified · Its sources say this.
Budget 2027 proposes further tax relief of up to RM150 for voluntary contributions to LINDUNG 24 Jam and LINDUNG Kendiri.
Sources:[2]
Verified · Its sources say this.
EIS contribution for wages above RM2,400 but not above RM2,500 is RM4.90 from the employer and RM4.90 from the employee.
Sources:[11]
Verified · Its sources say this.
EIS contribution is capped at RM11.90 each for wages above RM6,000 (ceiling RM6,000).
Sources:[11]
Verified · Its sources say this.
Relief for EPF contributions is restricted to RM4,000 (within a RM7,000 combined limit with life insurance/takaful).
Sources:[13]
Verified · Its sources say this.
Resident individual tax rates in force: 0% on the first RM5,000, 1% on RM5,001-20,000, 3% on RM20,001-35,000, 6% on RM35,001-50,000.
Sources:[12]
Verified · Its sources say this.
A rebate of RM400 is granted to an individual whose chargeable income does not exceed RM35,000.
Sources:[13]
Verified · Its sources say this.
Budget 2027 proposes raising the individual relief from RM9,000 to RM12,000 from year of assessment 2027.
Sources:[12]
Verified · Its sources say this.
Worked example (fictional): on RM2,500 gross, the EPF Third Schedule (Part A) gives RM275 from the employee and RM325 from the employer.
Sources:[14]
Verified · Its sources say this.
The 19-year-old Aina is a fictional worked-example persona. The one ringgit difference is an illustration of tiered-table rounding, not a universal maximum difference.
Sources:[15]
Verified · Its sources say this.
The fictional RM2,500.00 payslip uses the EPF band RM2,480.01–RM2,500.00, giving employee RM275.00 and employer RM325.00; RM0.00 income tax is specific to the stated example assumptions.
Sources:[4]
Verified · Its sources say this.
The tax-band widths of RM15,000 are arithmetic differences between the published thresholds; the RM1,700–RM3,000 first-salary range is an illustration, not a guarantee of zero tax for every person.
Sources:[13]
Sources
Numbers in the text, like [1], jump here.
- [1]Federal Government Gazette / Ministry of Human ResourcesMinimum Wages Order 2024 [P.U. (A) 376] (opens in a new tab)Published 4 Dec 2024 · Checked 22 Oct 2026
- [2]Ministry of Finance MalaysiaSpeech: The Fifth MADANI Budget 2027 (English translation) (opens in a new tab)Published 9 Oct 2026 · Checked 22 Oct 2026
- [3]MyGOV, Government of MalaysiaEPF Contribution as Employee's Rights (Young Workers) (opens in a new tab)Published 13 Mar 2026 · Checked 22 Oct 2026
- [4]Kumpulan Wang Simpanan Pekerja (KWSP/EPF)Employer Mandatory Contribution: contribution rates (opens in a new tab)Checked 22 Oct 2026
- [5]Kumpulan Wang Simpanan Pekerja (KWSP/EPF)Contribution for Non-Malaysian Citizen Employees (opens in a new tab)Checked 22 Oct 2026
- [6]
- [7]PERKESO (SOCSO)Employees' Social Security Act 1969 (Act 4): New contribution rate including the Non-Employment Injury Scheme (SKBBK) (opens in a new tab)Published 30 May 2026 · Checked 22 Oct 2026
- [8]
- [9]PERKESO (SOCSO)Non-Employment Injury Scheme (LINDUNG 24 Jam) (opens in a new tab)Checked 22 Oct 2026
- [10]The StarPERKESO's Lindung 24 Jam scheme now optional, says Fahmi (opens in a new tab)Published 8 Jul 2026 · Checked 22 Oct 2026
- [11]PERKESO (SOCSO)Rate of Contribution, Employment Insurance System (Act 800) (opens in a new tab)Checked 22 Oct 2026
- [12]Ministry of Finance MalaysiaBelanjawan 2027: Langkah-langkah cukai (Lampiran 1 dan 2) (opens in a new tab)Published 9 Oct 2026 · Checked 22 Oct 2026
- [13]Inland Revenue Board of Malaysia (LHDN / HASiL)Explanatory Notes, Form BE (resident individual, year of assessment 2024, filed in 2025) (opens in a new tab)Published 1 Mar 2025 · Checked 22 Oct 2026
- [14]Kumpulan Wang Simpanan Pekerja (KWSP/EPF)Third Schedule: rate of monthly contributions (effective 1 October 2025) (opens in a new tab)Checked 22 Oct 2026
- [15]MerekaFirst Move: authored exercise, prompts and worked examples (opens in a new tab)Published 24 Oct 2026 · Checked 24 Oct 2026