HRDF tax or known as Human Resource Development Fund is a mandatory tax payment collected by the Human Resource Development Fund (PSMB) imposed on employers from certain industries. Under the PSMB Act 2001, employers under certain categories are liable to pay a levy of one per cent of each employee’s monthly salary with 30 per cent of the levy channeled to the Human Resource Development Fund (HRDF) since 2016. It aims to help train employees and improving the skills of the Malaysian workforce.


1. Agriculture and farming

2. Livestock and fisheries

3. Forestry and logging

4. Mining and quarring

5. Manufacturing and production

6. Trading, business and wholesale

7. Construction

8. Supply

9. Real estate/ Property

10. Culture, arts and entertainment

11. Fashion and clothes

12. Cosmetics

13. Tourism and recreation

14. Services

15. Franchise

16. Electricity

17. Oil

18. Gas and steam

19. Water Sewerage

20. management of solid waste, liquid and gaseous and remedial

21. Automotive

22. Transportation

23. Repairs and maintenance

24. Storage

25. Delivery

26. Food and beverages

27. Information systems

28. Communication and multimedia

29. Broadcasting and film

30. Insurance and takaful

31. Investment

32. Co-operatives societies

33. Professional

34. Science and technology

35. Research and development

36. Science and technicality

37. Administrative and support services

38. Education

39. Medical and health facilities

40. Social welfare

41. Administration of organization membership

42. Small and medium enterprises

43. Household goods and services

44. Sports

45. Energy and natural resources

46. Personal services

Employers with 10 or more local employees are required to register. While employers who have 5 to 9 local employees or employers who have five/ more but less than five hundred thousand Malaysian employees who are non-governmental organizations and carry out any activities related to labour unions/ religious organizations/ political organizations/ nursing care facilities including nursing home for elderly, orphanages for the disabled, chemical abuse or any welfare services/ social work without lodging are optional to register.

Any employer who is required to register but has not registered with HRDF can be fined up to RM10,000 and/or imprisoned not exceeding one year. For information that employers under new industries will be given exemption from HRD levy until 31 December 2021 under the Human Resource Development Berhad Act 2001, provided that registration must be made before 31 December 2021.

More information can refer to the official portal of the Human Resource Development Corporation.