Malawi

Individual - Sample personal income tax calculation

Last reviewed - 04 March 2020

The annual PAYE threshold is MWK 540,000. The monthly PAYE is taxed as follows:

  • First MWK 45,000 will not be taxed (i.e. 0%).
  • The next MWK 5,000 will be taxed at 15%.
  • The next MWK 2,950,000 will be taxed at 30%.
  • The excess of MWK 3,000,000 will be taxed at 35%.

Example 1: If one earns MWK 1,000,000 per month, then the PAYE will be as follows:

Monthly income Tax rate (%) PAYE (MWK)
First MWK 45,000 0 0
Next MWK 5,000 15 750
Residual, which is MWK 950,000 30 285,000
Total 285,750

Example 2: If one earns MWK 3,500,000 per month, then the PAYE will be as follows:

Monthly income Tax rate (%) PAYE (MWK)
First MWK 45,000 0 0
Next MWK 5,000 15 750
Next MWK 2,950,000 30 885,000
Residual, which is MWK 500,000 35 175,000
Total 1,060,750