Short answer. Outsourced payroll means a provider calculates pay, applies statutory deductions, submits to KWSP, PERKESO and LHDN, issues payslips and gives you reports, using the information you send each month. It reduces errors and missed deadlines, and works best when you agree cut-off dates and responsibilities in writing.
Axecta provides payroll processing and employer compliance for companies across Malaysia. Talk to our team.
In this article
Scope of a payroll service
A standard service covers:
- Setting up employees and their statutory details.
- Monthly calculation of gross to net pay.
- EPF, SOCSO, EIS and PCB calculations using current tables.
- Preparation of the payroll summary for approval.
- Bank payment files or instructions.
Statutory submissions included
- Monthly submissions and payments to KWSP and PERKESO.
- PCB reporting and remittance to LHDN.
- Year-end employee statements and the employer’s annual return.
See employer payroll obligations for what the law expects.
Payslips and reporting
Need this done for you? Axecta’s payroll processing and employer compliance team can handle this for your company. See the payroll processing and employer compliance service.
- Individual payslips by secure delivery.
- Monthly payroll reports for management.
- Journal entries or summaries for your accountant.
- Leave and claims processing if included.
Data security and cut-off dates
Payroll data is sensitive. Ask providers about access controls, confidentiality, where data is stored and who can see it. Agree a monthly cut-off date for changes, and what happens to late changes. A late change often goes into the following month unless arranged otherwise.
How pricing is structured
Payroll fees are usually set per employee per month, per payroll run or as a monthly fee for a defined headcount. Extra charges may apply for setup, year-end filings, off-cycle runs or leaver processing. We do not quote figures here; ask for a written fee schedule.
Choosing a provider
- Does it use current statutory tables and LHDN specifications?
- Who handles errors, and how are penalties from provider mistakes treated?
- Can the provider also look after accounting and company secretarial matters?
- How quickly does it respond?
- What does it cost to leave, and how is data handed back?
Axecta’s payroll service
Axecta’s payroll team runs the monthly cycle, handles statutory submissions and gives your accountants the summaries they need. Because accounting and payroll sit in the same firm, payroll costs and liabilities flow into your books without re-keying. See what outsourced accounting includes.
What to ask a payroll provider to confirm in writing
- Which KWSP Third Schedule version and PERKESO table it applies (KWSP, PERKESO).
- Which LHDN PCB specification version it uses.
- Who pays the agencies and from which account.
- How errors and penalties caused by the provider are handled.
- How long payroll files are kept and how they are returned if you leave.
A transition plan
| Step | Detail |
|---|---|
| 1 | Share the prior payroll reports and year-to-date totals |
| 2 | Parallel run for one month |
| 3 | Compare results and fix differences |
| 4 | Switch and confirm agency registrations and contacts |
Frequently asked questions
What does outsourced payroll cover?
Pay calculation, statutory deductions and submissions, payslips and reports.
How much does payroll outsourcing cost?
Usually per employee or per run. Ask for a written fee schedule.
Is employee data safe?
It depends on the provider’s controls. Ask about access, storage and confidentiality.
Can I switch mid-year?
Yes, with a careful handover of year-to-date figures. Axecta handles transitions.
How do I check a provider applies current tables?
Ask for the version and date of each table it uses.
Should I run both systems for a month?
A parallel run is a safe way to compare results.
Who is responsible for penalties?
Agree it in the contract.
Want a payroll quote for your team?
Axecta Management Services is a full-suite accounting, company secretarial and consulting firm in Kuala Lumpur, serving companies from SMEs to MNCs.
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Keep reading
- Employer Payroll Obligations in Malaysia
- Outsourced Accounting Services in Malaysia: What Is Included?
- How Much Does an Accountant Cost for a Small Business?
- EPF, SOCSO and EIS Contributions Explained
- What Is PCB/MTD and How Is It Calculated?
- Monthly Payroll Processing Checklist
- When to Hire Your First Employee in Malaysia: Timing, Cost and Set-Up
- Employee Costs & Hiring Employees: the full guide
Official sources to check
- Axecta service scope
- KWSP, PERKESO, LHDN
This article is general information and not legal, tax or accounting advice for your company. Rates, thresholds, deadlines and procedures change, so confirm current requirements with the sources above or with Axecta.