Contents of this article are applicable to the following users
Tier: NA
Product: PayrollAny
Platform: Web
Access Level: Owner
Pay Items define the different components of your employees' pay — such as allowances, deductions, and other earnings — used in Malaysia Payroll. This guide explains the default pay items available in PayrollAny and how to create, configure, edit, and archive custom pay items for your organisation.
This guide will cover the following:
Default Pay Items
PayrollAny includes 6 default pay items for Malaysia Payroll. These are pre-configured and cannot be deleted, but you may edit them to fit your workflow.
Pay Item | Description | Applies To | How the Amount is Calculated |
Basic Pay | Base pay for hourly-rated employees based on hours clocked in the timesheet. | Hourly staff | Basic Hours × Basic Rate × 1 |
Overtime Pay | Additional pay for hours worked beyond the standard shift, captured as overtime in the timesheet. | All staff | Overtime Hours × Basic Rate × 1.5 |
Event/PH Pay | Pay for hours worked on public holidays or event days as tagged in the schedule. | Hourly staff | Event Hours × Event Rate × 1 |
Weekend Pay | Pay for hours worked on weekends as captured in the timesheet. | Hourly staff | Weekend Hours × Weekend Rate × 1 |
Basic Pay Salaried | Fixed monthly salary for salaried employees, prorated for incomplete months. | Salaried staff | (Days Worked ÷ Working Days in Period) × Monthly Salary |
Cash Incentive | Discretionary cash incentive paid out from EngageAny reward points accumulated by the employee. | All staff | Amount equals the employee's redeemed EngageAny reward balance for the payrun period. Requires EngageAny to be active in your organisation. |
Note: Rates (Basic Rate, Event Rate, Weekend Rate, Monthly Salary) are configured on each employee's compensation profile. To update a rate, go to Employees > select the employee > Payroll tab > Compensation.
How to Add a New Pay Item
From the sidebar, go to Payroll > Pay Item.
Click Create New Pay Item.
Fill in all required fields (see Pay Item Field Reference below).
Click Save.
Note: Custom pay items apply across all entities in your organisation.
Pay Item Field Reference
When creating or editing a pay item, you will see these Malaysia-specific fields:
Field | Description | Options |
Pay Item Name | The name of the pay item as it will appear in payroll (e.g. Meal Allowance, Lateness Penalty). | Free text. Required. |
Category | Determines whether the pay item is taxable and whether it adds to or deducts from the employee's pay. Also controls which statutory fields are editable. | Gross Addition, Gross Deduction, Net Addition, Net Deduction, Additional Tax Relief |
EPF | Whether this pay item is subject to EPF contribution calculations. If Yes, the amount will be included when computing EPF contributions for the employee and employer. | Yes / No. Automatically set to No for Net Addition, Net Deduction, and Additional Tax Relief. |
EIS | Whether this pay item is subject to EIS contribution calculations. | Yes / No. Automatically set to No for Net Addition, Net Deduction, and Additional Tax Relief. |
SOCSO | Whether this pay item is subject to SOCSO contribution calculations. | Yes / No. Automatically set to No for Net Addition, Net Deduction, and Additional Tax Relief. |
HRDF | Whether this pay item is subject to HRDF levy calculations. | Yes / No. Automatically set to No for Net Addition, Net Deduction, and Additional Tax Relief. |
PCB | How this pay item is treated for monthly income tax (PCB) deduction purposes. | Non Taxable — not included in PCB calculation. |
EA Field | Maps this pay item to the corresponding section on the EA Form (Borang EA) — the annual tax statement issued to employees. This ensures the pay item is reported under the correct income/deduction category for LHDN. | See EA Field Options section below. |
Calculation Type | How the pay item amount is calculated each payroll run. | Fixed Amount — a set monetary amount each run. |
Note: For Net Addition category, the EA Field is automatically set to Not Taxable and cannot be changed. For Net Deduction and Additional Tax Relief, statutory fields (EPF, EIS, SOCSO, HRDF, PCB) are automatically set and cannot be manually changed.
Malaysia Statutory Fields Explained
The following fields appear when configuring a pay item for Malaysia Payroll. Each corresponds to a statutory scheme administered by a Malaysian government body. Setting a field to Yes means the pay item's amount is included in the contribution base for that scheme — it does not enrol the employee. Employee enrolment is configured separately on the employee's profile under Statutory Settings.
Field | Full Name | Administered By | What It Does in StaffAny |
EPF | Employees Provident Fund | Malaysia's mandatory retirement savings scheme. Both employee and employer contribute a percentage of the employee's wages each month. When set to Yes, this pay item's amount is added to the EPF-eligible wage base used to calculate contributions. | |
EIS | Employment Insurance System | A social insurance scheme that provides financial assistance to employees who lose their jobs. Governed by the Employment Insurance System Act 2017 (Act 800). When set to Yes, this pay item's amount is included in the EIS monthly wage used to look up the contribution table. | |
SOCSO | Social Security Organisation | Provides employees with protection against occupational hazards and invalidity. Contributions are split into two categories: First Category (Employment Injury and Invalidity) covers employees below 60; Second Category (Employment Injury Only) covers employees 60 and above. When set to Yes, this pay item's amount is included in the SOCSO monthly wage base. | |
HRDF | Human Resource Development Fund | A levy paid by employers in specified industries to fund employee training and upskilling. Levy rates are either 1% or 0.5% of the employee's monthly wages depending on the organisation's category. When set to Yes, this pay item's amount is included in the HRDF levy wage base. | |
PCB | Potongan Cukai Bulanan (Monthly Tax Deduction) | Malaysia's monthly income tax withholding mechanism, where the employer deducts estimated income tax from the employee's salary each month and remits it to LHDN. The PCB setting on a pay item determines how it is treated in the tax calculation: Non Taxable excludes it entirely; Salary adds it to the regular income schedule; Bonus applies the separate bonus tax schedule. | |
EA Field | Borang EA (Form EA) | The annual employee tax statement (Borang EA) that employers must issue by the last day of February each year. It summarises the employee's total income, deductions, and tax withheld for the year, which the employee uses to file their annual tax return. The EA Field on a pay item maps that pay item's amounts to the correct section on the form. See the EA Field Options section below for the full list of mappings. |
Note: EPF, EIS, SOCSO, and HRDF are automatically set to No for Net Addition, Net Deduction, and Additional Tax Relief categories, as statutory contributions do not apply to these. PCB is automatically set to Non Taxable for the same categories.
EA Field Options
The EA Field maps the pay item to a specific section on Borang EA. Select the option that best matches the nature of the pay item.
EA Field | Description |
B1A | Gross salary, wages or leave pay (including overtime pay) |
B1B | Fees (including director fees), commission or bonus |
B1C | Gross tips, perquisites, awards/rewards or other allowances |
B1D | Income tax borne by the employer on behalf of the employee |
B1E | Employee Share Option Scheme (ESOS) benefit |
B1F | Gratuity |
B3 | Benefits in kind |
B4 | Value of living accommodation provided |
B5 | Refund from unapproved Provident/Pension Fund |
B6 | Compensation for loss of employment |
C1 | Pension |
C2 | Annuities or other periodical payments |
C3 | Zakat paid via salary deduction |
D2 | CP38 deductions remitted to LHDNM |
D3 | Zakat paid via salary deduction (Tax Relief) |
D4 | Approved donations/gifts/contributions via salary deduction |
D5B | Zakat other than that paid via monthly salary deduction |
F | Tax exempt allowances/perquisites/gifts/benefits |
Not Taxable | Pay item is not taxable and will not appear on the EA Form income sections |
Note: Available EA Field options vary by category. For example, D3/D4/D5B are only available for Additional Tax Relief; D2 (CP38) is only available for Net Deduction.
How to Edit a Pay Item
Go to Payroll > Pay Item.
Click the Edit (pencil) icon next to the pay item.
Update the fields as required and click Save.
Note: Changes apply to future payroll runs only. Past records retain the original pay item details.
How to Archive Pay Items
Go to Payroll > Pay Item.
Click the Archive icon next to the pay item and confirm.
Note: Default pay items cannot be archived. Toggle Show Archived to view or restore archived items.
FAQs
Can I delete a pay item?
Pay items cannot be permanently deleted. Archive it if it is no longer in use.
What is the difference between PCB: Salary and PCB: Bonus?
LHDN applies different tax calculation schedules to regular salary income and bonus payments. Setting PCB to Salary uses the standard monthly income schedule; setting it to Bonus uses the bonus schedule. Select the one that matches the nature of the pay item.
What happens if I select the wrong EA Field?
The pay item will be reported under the wrong income category on Borang EA, which could result in discrepancies in the employee's annual tax statement. Always match the EA Field to the nature of the payment.