Step-by-step calculation
This walk-through assumes a Myanmar tax resident sales employee with a base salary plus monthly commissions on closed deals. Default: single, no dependant allowances, no donations. Brackets are from the Union Tax Law 2025-2026 (Section 5). Commissions are fully assessable salary in the year paid; no preferential rate applies. Tax year: 1 April – 31 March.
Step 1 — Apply the 20% basic personal relief
Aggregate base salary and total expected commissions for the year, then apply the 20% basic personal relief, capped at MMK 10,000,000/year. The cap binds when total gross exceeds MMK 50,000,000.
| Annual base salary | (figure) |
| Plus: total commissions earned in the year | (figure) |
| = Annual gross assessable salary | (sum) |
| Less: 20% basic personal relief | − up to MMK 10,000,000 |
| Less: spouse / child / parent allowances | 0 in default case |
| Annual taxable income | = residual |
Step 2 — Apply the Union Tax Law 2025-2026 brackets
| Annual taxable income | Marginal rate |
|---|---|
| 1L – 20L (MMK 0 – 2,000,000) | 0% |
| 20L – 100L (MMK 2,000,000 – 10,000,000) | 5% |
| 100L – 300L (MMK 10,000,000 – 30,000,000) | 10% |
| 300L – 500L (MMK 30,000,000 – 50,000,000) | 15% |
| 500L – 700L (MMK 50,000,000 – 70,000,000) | 20% |
| 700L & above (MMK 70,000,000+) | 25% |
Worked illustration — base salary MMK 12,000,000 + commissions MMK 8,000,000 = MMK 20,000,000 annual gross (taxable = MMK 16,000,000 after 20% relief):
| Band | Amount in band (MMK) | Rate | Tax (MMK) |
|---|---|---|---|
| First 2,000,000 | 2,000,000 | 0% | 0 |
| 2,000,001 – 10,000,000 | 8,000,000 | 5% | 400,000 |
| 10,000,001 – 16,000,000 | 6,000,000 | 10% | 600,000 |
| Annual PIT (incl. commission) | MMK 1,000,000 | ||
Step 3 — Convert to monthly withholding
- Smoothed (estimate): MMK 1,000,000 ÷ 12 ≈ MMK 83,333/month from April; recompute as actuals come in.
- Per-month actuals: withhold PAYE on the actual base + commission line each month, applying the cumulative-bracket method.
- Annual reconciliation: by 30 June, true up to the actual annual figure.
What about SSB and the true net salary?
Commissions enter the wage base for SSB up to MMK 300,000/month cap. Most sales employees on commissions are well above the cap, so the employee 2% deduction is fixed at MMK 6,000/month and employer 3% at MMK 9,000/month.
| High-commission month gross | MMK 1,000,000 base + MMK 1,500,000 commission = MMK 2,500,000 |
| Less: PIT (per cumulative bracket) | − (per calculation) |
| Less: SSB (employee, 2% on cap) | − MMK 6,000 |
| Monthly take-home | = residual |
Employer takeaway
Treat commissions as ordinary salary in the year paid. Use either a smoothed projection or per-month actuals, but reconcile to the annual UTL-bracket calculation by year-end. Remit PIT to IRD by the 15th of the following month, reflect commissions on the annual reconciliation by 30 June, and retain commission schedules, deal evidence, and PAYE calculations for at least 7 years.
Common variations to watch for
- Quarterly commission accrual — taxed in the month of payment, regardless of accrual.
- Claw-back on cancelled deals — refund or offset in the next payroll; do not reverse PAYE within the year if recovered.
- Commission to non-employees (agents) — withholding tax under separate rules, not PAYE.
- Multi-currency commission (USD-denominated) — convert at Central Bank rate on payment date.
- Spiff / one-off sales bonus — same treatment as commission. See bonus tax.
Common PIT mistakes to avoid
- Treating commission as separate from salary for relief — the 20% relief is annual aggregate.
- Skipping PAYE on commission-only months when base is fixed elsewhere — both are salary.
- Forgetting the marginal-rate jump — high-commission months can push the employee into a higher band.
- Late remit on the commission month PAYE — interest applies. See penalties.
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