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The LHDN’s new income tax rate 2023

The LHDN's new income tax rate 2023

We have an update from LHDN. The LHDN just announce the new income tax rate for resident individuals has been gazetted recently and takes effect in June 2023. You may refer more details in the latest document on LHDN’s website. View document here.

The LHDN's new income tax rate 2023

The date in the PDF is 1st of January 2023, but please be rest assured that this update was released in June (as the effective date is 1 Jun 2023). All calculations from January until May 2023 are still correct.

With this, the calculation of PCB (Potongan Cukai Bulanan, or Monthly Tax Deduction (MTD)) must be updated with the new income tax rates.

When you run your payroll for June 2023, in the payroll calculator, please recalculate the payroll of all employees to reflect the changes. Here is a summary of the changes:

  • Employees in different salary ranges will have a different percentage in the calculation.
  • Changes to tax reliefs, where some tax reliefs have been increased.
  • Changes to TP1 and TP3, where some items have been removed.

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The LHDN's new income tax rate 2023
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