The Finance Act 2023 (Act 845), which was gazetted on 31 May 2023, incorporates a change in the tax rates for resident individuals.
Under this change, middle-income resident individuals will benefit from a 2% reduction in their individual income tax rate.
On the other hand, higher-income resident individuals will experience an increase in their tax rate ranging from 0.5% to 2%.
These adjustments promote fairness and support vulnerable groups within the tax system. You can refer to Section 16(a) of the Finance Act 2023 for detailed information regarding this change.
Consequently, the Inland Revenue Board of Malaysia (HASiL) has issued the following documents and updated its website to reflect the implementation of new tax rates for the calculation of Monthly Tax Deduction (MTD) beginning on 1 June 2023:
Amendment To: Specification for MTD Calculations Using Computerised Calculation for 2023(updated 1 June 2023).
Questions for MTD Calculation Using Computerised Calculation Method 2023.
Form PCB/TP1 (1/2023) – Individual Deduction and Rebate Claim Form for the Purpose of MTD and
Explanatory Notes on Form TP1 [Bahasa Malaysia (BM) version only].
Form PCB/TP3 (1/2023) – Information Form Related to Employment with Previous Employers in the
Current Year for the Purpose of MTD and Explanatory Notes on Form TP3 [BM version only].
Finance Act 2023:-
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