Foreign nationals must obtain the appropriate work visa before legally working in Malaysia.

• Common categories include Employment Passes (EP) for skilled professionals, Temporary Employment Passes, and sector-specific passes (e.g., ICT).
• Employers or EOR providers typically sponsor the visa application and coordinate documentation submission to Malaysia’s Immigration Department.
• Work visas are usually valid for 1–5 years and renewable.
• Employers must maintain immigration compliance and report changes in employment status.

• Employers must register with the Inland Revenue Board (LHDN) and social security authorities to operate payroll.
• Payroll is typically processed monthly, with salaries paid according to contract terms (commonly at month-end).
• Employers are responsible for withholding personal income tax and remitting monthly contributions for statutory benefits.
• Withholding: Progressive income tax for residents up to 30% and flat 30% for non-residents.
• Social Security & Benefits: Employers contribute to the Employees Provident Fund (EPF), Social Security Organisation (SOCSO), Employment Insurance System (EIS), and, where applicable, the Human Resource Development Fund (HRDF).
• Employer Contributions: EPF ~12–13%, SOCSO ~1.75%, EIS ~0.2%, HRDF ~1% (if applicable). ‍
• Employee Contributions: EPF ~11%, SOCSO ~0.5%, EIS ~0.2%.

• Contracts may be fixed-term or indefinite and must be provided in writing.
• Contracts should specify role, remuneration, working hours, and termination terms.
• Probation periods are typically not longer than three to six months.
• Malaysia’s Employment Act governs notice periods and termination, including pay in lieu of notice.
• Overtime and public holiday compensation are governed both by statute and contract terms.

• Annual Leave: Typically after 12 months of service, with statutory minimums increasing with length of service.
• Sick Leave: Paid sick leave with medical certification.
• Maternity Leave: Statutory maternity protection and benefits under the Employment Act; funded partly through social schemes and employer policy.
• Public Holidays: Paid statutory holidays observed nationwide and regionally.
• Other Benefits: Employers often provide additional allowances such as transport or medical coverage.

• Tax Residency: Individuals present ≥182 days in a year are generally tax residents and taxed on employment income in Malaysia.
• Tax Year: Calendar year (January 1 – December 31).
• System: Progressive income tax up to 30% for residents; non-residents flat 30%.
• Double Tax Agreements: Malaysia has an extensive network of DTAs.