Why does my PCB contribution fluctuate by a few cents every month?

If your employee is set to pay PCB and SOCSO then the PCB calculation changes slightly every month. The reason for this is because of the way LHDN has specified the calculation formula:

The tax payable is calculated over the rest of the year and then divided by the number of months remaining in the year. However, SOCSO is treated as a non-recurring item (ie. happening only that particular month and not for the rest of the year) so that the tax is slightly higher than it should be. This is why the tax is reduced slightly again the following month as the SOCSO deduction for the year is increased in the calculation.

We can confirm that PayrollPanda Sdn Bhd is following the specification for PCB calculations issued by LHDN. The issue of fluctuating PCB did not arise before 2016 because it is only from 2017 onward that SOCSO is deductible for tax purposes.

This is why the net pay changes only for employees who pay both PCB and SOCSO, not others.

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