The computerised calculation method was introduced in 2009 and applicable for employers that use a computerised payroll system with specifications approved by the Inland Revenue Board Malaysia (IRBM). However, an employer who does not use a computerised payroll system will continue to deduct employees’ monthly tax using the Schedular Tax Deduction (STD) Method.

This was subsequently streamlined further in 2010 where employers no longer refer to employees’ monthly tax deduction as monthly Schedular Tax Deduction (STD) but Monthly Tax Deduction (MTD), using either the computerised calculation method or the schedular tax deduction table method.

Due to these changes in 2009 and 2010, employers experienced difficulty in answering their employees’ queries on the sudden increase/ decrease in their monthly tax deductions. This program seeks to shed light on these queries and to enhance understanding of the calculations and formula.