What is the maximum permissible deduction from wages in Myanmar?
Total non-statutory deductions from monthly wages in Myanmar are typically capped at 50% of the gross. Statutory deductions (PIT, SSB) sit outside the cap. Court-ordered garnishments also typically sit outside. If total non-statutory deductions exceed 50%, schedule the balance to the next pay cycle.
What Myanmar law says
The Payment of Wages Law caps total non-statutory deductions at approximately 50% of monthly wages. Statutory deductions sit outside the cap:
- PIT (Union Tax Law 2025-2026) — outside cap.
- SSB employee contribution (Social Security Law 2012) — outside cap.
- Court-ordered garnishments — typically outside cap (must follow the order).
Within the 50% non-statutory cap sit: salary advances, employer loans, agreed damages, unauthorised absence deduction, and any other consensual deductions. If total exceeds 50% in a month, the excess must be deferred to the next cycle.
Worked example — high-deduction month at MMK 800,000 gross
| Deduction | Category | Amount (MMK) |
|---|---|---|
| PIT | Statutory (outside cap) | 15,000 |
| SSB 2% (capped) | Statutory (outside cap) | 6,000 |
| Salary advance | Non-statutory | 200,000 |
| Damage instalment | Non-statutory | 100,000 |
| Unauthorised absence (3 days) | Non-statutory | 92,308 |
| Non-statutory total | — | 392,308 |
| 50% of gross | — | 400,000 (cap not breached) |
| Net pay | — | 486,692 |
Documentation requirements
- Written consent for advances, loans, and damages.
- Court order for garnishments.
- Attendance evidence for absence deductions.
- Payslip itemising every line; net pay clearly visible.
- Record retention: at least 7 years.
Edge cases
- Final settlement on exit — net cannot be negative; carry residual to next employer or write off.
- Garnishment order exceeding 50% — comply with the order; statute gives priority.
- Salary advance write-off — recoverable through legal channel if employee leaves with balance.
- Multiple loans — schedule across multiple months to stay within cap.
- Damages exceeding 50% — schedule across multiple months and document.
- Sub-minimum-wage outcome — even if cap not breached, the net cannot fall below the relevant minimum-wage threshold for the period worked.
Employer takeaway
Total non-statutory deductions are capped at ~50% of monthly wages. PIT, SSB, and court-ordered garnishments sit outside the cap. If aggregate non-statutory deductions exceed 50%, defer the excess to the next cycle. Itemise every line on the payslip, retain consent and order documents 7 years, and pay net wages by the 7th of the following month.
Common payroll mistakes
- Pushing total non-statutory deductions past 50% in one month.
- Treating PIT or SSB as part of the 50% cap (they are outside).
- Failing to defer excess to the next cycle.
- Skipping written consent for advances and damages (see damage deduction).
- Not itemising on the payslip — Payment of Wages Law violation (see payslip required fields).
- Payment of Wages Law — non-statutory deduction cap
- Union Tax Law 2025-2026 — PIT withholding
- Social Security Law 2012 — SSB contribution
Related questions
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