Which payments are subject to SOCSO/EIS contribution and which are exempted?

Payments Subject to SOCSO/EIS Contribution

"Wages" for contribution purposes refers to all remuneration payable in money by an employer to an employee.

This includes:

  • Basic Salaries
  • Overtime payments
  • Commissions
  • Payments in respect of leave
  • Service charges

Payments Exempted From SOCSO/EIS Contribution

The payments below are not considered “wages” and are not included in the calculations for monthly deductions:

  • Any contribution payable by the employer towards any pension or provident fund
  • Any travelling allowance
  • Any gratuity payable on discharge or retirement of the employee
  • Any sum paid to cover expenses incurred by the employee in the course of his duties
  • Annual bonus
  • Gifts - eg, cash payments for holidays like Hari Raya, Christmas

Let our payroll software calculate all your contributions. Book a demo.

Was this article helpful?

Download The Free Guide