By now, mostly likely you have seen the latest announcement (24th Feb) for the newly revised Budget 2023 (Malaysia), specifically for individual income tax rates.
With effect from YA 2023 (June), the individual income tax rates will be updated accordingly:
each of the chargeable income bands from RM35,001 to RM100,000 is reduced by 2%
each of the chargeable income bands from RM100,001 to RM1,000,000 is increased by between 0.5% to 2%.
These new tax rates and reliefs will officially be effective from 1 June 2023 as the Finance Act 2023 was gazetted on May 31, 2023.
As such, we have already updated the new income tax rates and reliefs to apply in Talenox payroll automatically from June 2023 onwards. 😄
How Do I Use The Old Rates for the Payroll Months Before June 2023? (Jan - May 2023)
To ensure that our users will have accurate PCB/MTD calculations in the system, we have created a setting to help users select the rates they'd like to utilise for the payroll months of January to May 2023.
Head to Profiles > Company Details > Payroll Details > 2023 January to May PCB Tax Rate Settings where you'll be able to select the following options:
Users can then select the "Old Rate" option, which will follow the old rates for PCB calculations in Talenox before the new rates were gazetted officially in June 2023 onwards for the YA 2023.
NOTE: Certain users may opt to implement the New Rates at the commencement of the year. Therefore, they would choose the "New Rates" setting for payroll calculations from January to May 2023 in Talenox.
What Do I Need To Do To Utilise PCB New Tax Rates From June 2023 Onwards for YA 2023? (After Gazetting)
Absolutely nothing at all! No action is required on your end of things.
Talenox will help to apply the new PCB tax rates for you automatically in payroll for June 2023 onwards. 😄
Important points to take note of:
The New Rates were officially pushed live in Talenox on the 16th of June - for the payroll month of June 2023 onwards in YA 2023.
For users who have processed payroll in June 2023 payroll month before the new rates were pushed live in Talenox (16 June), you'll need to re-process payroll to have the new rates apply to any previous payroll batches in the month.
Please do not adjust your "2023 January to May PCB Tax Rate Settings" settings to apply to June 2023 payroll month onwards as this setting is only applicable for the months of January to May 2023.
We hope this helps you with understanding how to ensure accuracy in your PCB rates used for payroll processing in Talenox!