Overtime pay in Malaysia 2026: premiums, limits and tax
Overtime, night work and work on Sundays and public holidays in Malaysia can earn a premium on top of your normal hourly pay, and the extra pay is taxed at your highest rate. The calculator above shows what you really keep. Below you will find the rules in brief, an example and answers to common questions.
The rules in brief
- Employment Act 1955 s. 60A: Employees earning up to RM4,000 a month must be paid at least 1.5 times the hourly rate for overtime on normal days, 2 times on rest days and 3 times on public holidays. The normal week is at most 45 hours and overtime at most 104 hours a month. Higher earners follow their contract.
Example: 8 hours of overtime a month
| Type | Rate | € / h gross (MYR) | € / h net (MYR) |
|---|---|---|---|
| Overtime | +50% | 30.77 | 21.27 |
| Sunday / holiday premium | +100% | 20.51 | 14.18 |
With a normal hourly rate of MYR 20.51 (annual salary ÷ 52 ÷ weekly hours), 8 hours of overtime a month at +50% add MYR 246.15 gross, of which you keep MYR 170.16 net a month. You keep 69.1% of each taxed extra unit. Over a year that comes to MYR 2,042 (net · MYR 2,954 gross).
Frequently asked questions
How much of my overtime pay do I keep in Malaysia?
In the example, 69.1% of each extra unit of gross pay, i.e. MYR 170.16 net from 8 overtime hours a month. The share depends on your salary, because extra pay is taxed at your highest rate.
Is there a legal overtime premium in Malaysia?
The example uses +50% for overtime. The exact rules, including night, Sunday and holiday premiums, are listed above.
How many overtime hours are allowed?
The calculator uses this limit: 104 h / month. See the rules above for averaging periods and exceptions.
Are these amounts exact?
They are estimates under the 2026 rules. Your contract or a collective agreement can set higher premiums or different limits.
Rules and official sources: see “Rules applied (2026)” above. Last checked: October 2026. The amounts are estimates for information, not financial or legal advice.