Types of HRD Corp Levy and Ways to Make Payment

How to file and pay HRD levy

Under the expansion of the Pembangunan Sumber Manusia Berhad (PSMB) Act 2001, employers from the agriculture, construction, and financial services sectors are also required to register. These newly registered employers need to start paying their monthly levy subjected to their liability date.

As an example shown above, the liability date is on 1 January 2022. Therefore, the employers need to start paying the levy of January 2022 by 15 February 2022. 

Each month employers are required to pay 1% of total wages to HRD Corp. The accumulated levy can be used to retrain and improve or upgrade the skills of the employees, apprentices, and trainees by sending them to training programs based on the identification of employers’ needs. Levy calculation is as follows: 

Director is also considered an employee and must pay the levy too. If the director(s) does not receive any salary and only 6 employees’ salaries to pay the levy.
Other than the current levy that employers need to pay every month, HRD Corp also introduces a levy in arrears and interest of arrears. Following are the details of each levy:

  1. Current levy
    • Payment made within a stipulated period - by the 15th of each month
  2. Levy in arrears
    • Payment of levy made after the stipulated period – after 15th of each month
  3. Interest of arrears
    • Payment made due to late levy payment at a rate of 10% for each day late
    • The minimum interest to pay is RM 5.00

There are several ways to pay the levy, namely manual payment, online payment, and using the JomPAY service. Following are the steps to make the payment:

  1. Manual payment
    • Payment can be made over the counter at Public Bank or RHB Bank
    • The employers need to fill up Form 2 (E-slip Form) and print out E-slip from eTRis and presented it at the bank counter to make the payment
  2. Online payment
    • Payment made via online banking from the selection of banks available in eTRis
    • Options of banks available such as RHB Bank, Public Bank, and MEPS FPX
  3. JomPAY
    • Payment is made by using JomPAY via internet banking and the biller code is 4044
    • Fill up Form 2 and download the JomPAY slip from eTRis and log in to the internet banking and enter HRD Corp biller code, Ref 1, and payment amount as stated in the slip

The payment flow will be as follows: 

Levy payment needs to be done before the stipulated time which is on the 15th of every month. If the payment is not done within the stipulated time, 10% of interest for each day delay will be imposed on the employer. Other than that, HRD Corp may fine the employer with the amount of RM 20,000 or imprisonment not more than two years or can be both.

Kosumy is providing compliance support to the employers to ensure that your levy submission will be on the stipulated time. Avoid paying the arrears and their interest by subscribing our service. Contact us at info@kosumy.com to learn more about our service.