How To Pay Income Tax In Malaysia For First-timers

Summary

Every first-timer must have a Tax Identification Number (TIN) before dealing with income tax. For online e-Filing, checking your balance and using most self-service payment options, you should also set up a MyTax account.
After filing your income tax in MyTax, the system will show whether you owe a balance or are entitled to a refund.
The easiest online payment method for beginners is usually ByrHASiL using FPX internet banking.
If you receive instalment forms such as CP500, you must pay according to the schedule or apply for a revision.
Late payment can result in penalties and enforcement actions, so it is important to check your balance early.

If this is your first time dealing with the Malaysian income tax system, it is normal to feel overwhelmed.

The terminology, forms, and platforms can sound complicated at first. You might hear about TIN, MyTax, e-Filing, PCB, ByrHASiL, CP500 and wonder how they connect to one another. But the truth, the process is very manageable once you understand the sequence. You only need to follow a few clear steps.

Hence this guide by the leading accounting firm is written with beginners in mind, we will show you exactly how to check what you owe, how to access the right LHDN systems, and how to make your payment smoothly and safely.

After this, you can proudly claim you are a taxpayer the next time you complain about the potholes with your friends.

Who Needs To Pay Income Tax In Malaysia

You need to pay income tax if your total chargeable income for the year is above LHDN’s taxable threshold and the final calculation shows you owe a balance.

To help first-timers understand this better, here is a simple threshold guide.

Malaysian Income Tax Threshold Guide (As of YA 2024 / 2025)

Chargeable income is your income after EPF deductions, personal reliefs, and other tax deductions.

Malaysia uses a progressive tax rate, so there isn’t one single salary where you “suddenly” start paying tax.

To keep things beginner-friendly, here is a plain-language guide based on current LHDN rules:

Annual Employment Income After EPF Is RM37,333 Or Less

If you have a monthly salary of RM3100, you are usually below the main taxable threshold for salaried workers.

Many people in this range either pay no tax or a very small amount once reliefs and rebates are applied.

Above RM37,333 after EPF

In this bracket, you fall into the taxable range and PCB (Potongan Cukai Bulanan) normally starts. How much you actually pay will depend on:

Your total income (salary + side income)
Your tax reliefs (for example lifestyle, parents, education)
The RM400 tax rebate for residents whose chargeable income does not exceed RM35,000
Any zakat or other religious dues you claim as a rebate

To give you a feel for it, here is how many first-timers typically experience tax:

Annual Situation (after EPF & reliefs)	What Usually Happens*
Up to RM30,000 chargeable income	Often no tax payable after the RM400 rebate (if you qualify) and basic reliefs.
Around RM30,001 – RM50,000 chargeable income	You enter the early tax bands. Tax is usually small to moderate, especially if you fully use your reliefs.
RM50,001 – RM100,000 chargeable income	You are in the middle tax brackets. Most individuals in this range pay a noticeable amount of tax each year.
Above RM100,000 chargeable income	You are in the higher tax brackets, and tax planning (reliefs, rebates, pension/EPF, etc.) becomes more important.

Rule of thumb for salary earners:

If your monthly employment income after EPF is around RM3,100–RM3,200 or more, you are likely within LHDN’s taxable range.

Your actual tax still depends on how many reliefs and rebates you claim and if you have extra income such as rental or freelance work.

Common Groups Who End Up Paying Income Tax

Individuals whose total income exceeds the taxable limit after reliefs
Employees with PCB that does not fully cover their final tax
Freelancers, gig workers, and small business owners with non employment income
Landlords or anyone earning rental, commission, or royalty income
Individuals who receive CP500 instalment notices for non employment income

These groups often owe a balance because PCB (Potongan Cukai Bulanan) and instalments may not align perfectly with their actual income.

Why PCB Alone Does Not Guarantee You Are Done

Even if PCB is deducted every month, that amount is only an estimate.

After you file your tax return, LHDN recalculates your actual tax based on:

Your total income
Your reliefs
Your deductions
Any side earnings
Any previous instalments (for example CP500)

This may result in:

A refund if PCB was higher
A balance of tax if PCB was lower

That is why every Malaysian still needs to file, even if PCB is deducted, any audit firm worth their salt will tell you that.

Step 1: Make Sure You Have a TIN and a MyTax Account

Before you can file or manage your tax, you need two things:

Tax Identification Number (TIN)

Malaysia now uses a Tax Identification Number (TIN) for all taxpayers.

The TIN system has been implemented nationwide, and if you have registered with LHDN before, you probably already have a TIN.
For individuals who are new to tax, from 1 January 2024 onwards, TIN applications are made online via e-Daftar on the MyTax website.

You can register for a TIN via e-Daftar on the MyTax portal.

MyTax Account

MyTax is the main portal for:

Filing your tax return (e-Filing)
Checking your account and e-Lejar
Viewing and downloading your bill numbers
Using services like e-Ansuran and e-TT

First-timers can register directly on the MyTax site.

“You must have a TIN to be a taxpayer. For online filing and most self-service payment methods, having both TIN + MyTax makes the process much smoother, although some payments (for example over the counter or via e-TT) can be done using only your TIN.”

Once both are ready, you can proceed to filing your tax return.

Step 2: File Your Income Tax Through MyTax

Filing your tax return is necessary before you can know if you owe money.

How beginners usually file

Go to the MyTax portal and log in.
Select ezHasil services and choose e-Filing.
Pick the correct form for your situation, for example Form BE for resident individuals with employment income.
Fill in your income, PCB deductions, and personal reliefs.
Submit the form and review the summary of your tax position.

What happens next

Once your form is submitted, the system shows one of two outcomes:

Refund if your PCB was higher than your actual tax
Balance of tax if your PCB or instalments were not enough

If you owe a balance, you will need your Bill Number for payment. The next section explains how to check this.

Step 3: Check Whether You Owe Any Income Tax

First-timers often assume that PCB covers everything. That is not always the case, which is why MyTax is important.

How to check your balance

Log in to MyTax.
Go to e-Lejar or your account summary.
Look for any outstanding balance or previous years’ adjustments.
Note the Bill Number, which you will need for most payment methods.

If you have a balance of tax, you can proceed to payment.

Step 4: Pay Your Income Tax Through Your Preferred Method

There are several payment options in Malaysia. For first-timers, the simplest and fastest method is ByrHASiL with FPX.

How To Pay Income Tax Online Through ByrHASiL and FPX

According to LHDN, ByrHASiL is the official online payment service for income tax. You can pay using your Bill Number or TIN.

Steps for beginners:

Go to the LHDN website and select Perkhidmatan ezHasil followed by ByrHASiL.
Enter your Bill Number or TIN.
Confirm that the tax amount displayed is correct.
Choose FPX as your payment method.
Select your bank and proceed to authorise the payment.
Save the receipt for your records.

FPX has transaction limits based on bank settings and LHDN rules. If your tax amount is high, you may need to make several payments or use an alternative method.

How To Pay Income Tax Through Your Bank

Most major banks in Malaysia allow LHDN payments.

Steps for internet banking

Login to your online banking portal.
Go to the Pay Bills section.
Search for LHDN or Hasil.
Key in your Bill Number or TIN.
Enter the amount and complete payment.

Maybank notes that you can first retrieve your Bill Number through MyTax, then select FPX at payment stage and use Maybank2u or its alternative channels.

Paying over the counter

If you prefer face-to-face payments, iMoney lists participating banks and POS Malaysia branches that accept tax payments.

These include Maybank, Public Bank, CIMB, RHB, Bank Rakyat, BSN and POS Malaysia.

Bring your TIN or Bill Number with you.

How First-Timers Can Pay From Overseas

If you are currently outside Malaysia, do not worry! LHDN allows payments from abroad.

Available options include:

e-TT which creates a Virtual Account Number for telegraphic transfers.
Bank transfers that support IBG, EFT or TT, depending on your bank.

Keep your SWIFT receipt or TT advice slip. Later, log in to MyTax to confirm that the payment has been credited.

Understanding CP500 Instalments For First-Timers

Many Malaysians get confused when they receive a CP500 notice, especially if it is their first time dealing with income other than employment income.

What is CP500

CP500 is a tax instalment scheme for individuals with business, rental or other non employment income. It spreads your estimated tax over six payments.

LHDN calculates the instalment amount based on your previous year’s income.
Instalments are due every two months. Typical dates include 30 March, 30 May, 30 July, 30 September, 30 November and 30 January.
Late CP500 payments can incur a penalty of 10 %.

How to pay CP500

Use the same channels as normal tax payment:

ByrHASiL
Internet banking
Over the counter

Always select the correct instalment reference to avoid mismatched payments. LHDN provides guidance on how bill numbers reflect different periods.

Penalties for Late or Missed Tax Payments

Situation	Penalty / Charge	Details / Conditions
Late payment of personal income tax	10% increase on unpaid tax amount	For individual taxpayers, unpaid tax after the due date triggers a 10% surcharge.
Outstanding unpaid tax + no payment after initial penalty	Additional surcharge (often another 5%) if still unpaid for 60 days after first penalty	5% extra penalty applies if tax remains unpaid 60 days after the initial late-payment surcharge.
Late CP500 instalment (for self-employed, rental, business)	10% penalty on the outstanding instalment amount	If a CP500 instalment is not paid within 30 days from the due date on the notice, LHDN may impose a 10% penalty on the unpaid instalment.
Underestimated tax declaration	10% penalty on the excess amount above 30% of actual tax	Applies when actual tax payable exceeds the estimated tax by a wide margin.
Failure to submit tax returns or report income	Fines from RM200 up to RM20,000 and/or imprisonment (typically up to 6 months or 3 years) Additional tax penalties that can be up to 300% of the tax undercharged in serious cases such as deliberate evasion.	This is for deliberate non-compliance, false reporting, or tax evasion.

Familiar Scenarios for taxpayers

Salary earner with only PCB

Aisha works for a company that deducts PCB monthly. After filing her tax return, she discovers she is entitled to a refund.

No payment is needed.

She simply waits for LHDN to process the refund.

Employee with freelance income

Brandon has a full time job with PCB plus some freelance income.

After filing, he owes a small balance.

He retrieves his Bill Number from MyTax and pays through ByrHASiL using FPX.

Freelancer with CP500

Siti runs a small online business. She receives CP500 instalments and pays them every two months through internet banking by selecting LHDN as biller.

If her income drops, she can request a revision.

Checklist For First-Timers

Register or confirm your TIN.
Set up your MyTax account and log in.
Complete e-Filing for the correct assessment year.
Check your balance of tax and retrieve your Bill Number.
Pay using ByrHASiL FPX, internet banking, or over the counter.
Save your receipt and check your e-Lejar later.

Congratulations, You Are Officially a Taxpayer

Once you complete the process, you can proudly say you filed and paid your taxes like a pro and wonder why on earth our secondary schools don’t teach them during accounting classes.

If you are still unsure about filing, confused by reliefs, or worried about missing deadlines, we can help!

At MyAdvisory, we assist individuals and businesses with accurate tax filing, proper documentation, and full compliance, so you do not have to navigate everything alone.

Our taxation services make the entire process easier, safer, and fully compliant.

Reach out to us and let our team guide you from start to finish.

Source:

LHDN – Online (e-Daftar) – Individual TIN Registration
LHDN – Tax File Registration (Company)
LHDN – Frequently Asked Questions (Individual)
PwC Malaysia – “Malaysia: Individual – Other tax credits and incentives”
LHDN – Tax Deduction, Relief and Rebate (leaflet 007a)
LHDN – “Siapa Kena Cukai?” (Who Has To Pay Tax?)
ClearTax Malaysia – “Kadar Cukai Pendapatan di Malaysia: Panduan Komprehensif”
LHDN – “Bayaran Pendahuluan Anggaran Cukai” (Advance Payment of Estimated Tax)
eCentral – “Borang CP500 LHDN: Notis Bayaran Ansuran Cukai”
Income Tax Act 1967 (Act 53)

Frequently Asked Questions About How To Pay Income Tax In Malaysia

How Do I Pay Income Tax Online In Malaysia If It Is My First Time?

First, file your tax return in MyTax. If you owe money, go to ByrHASiL, enter your Bill Number or TIN, and pay using FPX.

What If My Employer Already Deducted PCB?

PCB is an estimate. You still need to file your tax return. The final amount may be higher or lower. If it is higher, you must pay the difference. If it is lower, you receive a refund.

Can First-Timers Pay Income Tax By Credit Card?

Some banks and partner services allow it, sometimes with a fee. Check the latest options on the LHDN and bank websites.

How Do I Pay Income Tax From Overseas?

Use e-TT or bank transfer options supported by LHDN. A Virtual Account Number can be generated to ensure your payment is matched correctly.

What Happens If A First-Timer Pays Late?

You may face penalties, tax increases or enforcement actions. For CP500, late payment results in a 10 percent penalty.

Can I Pay In Instalments If I Cannot Afford Everything At Once?

Yes. You can use the CP500 schedule if relevant or discuss e-Ansuran with LHDN for balance of tax. Contact them early if you need help.