Unused HRD Corp levy is never refunded in cash, and it does not wait for you. If an employer makes no successful training claim for two years, HRD Corp forfeits everything above RM10,000 of the balance that was already there two years earlier, and leaves that RM10,000 in the account. A balance under RM10,000 is exempt. The clock runs from your last successful claim.
- The trigger is 24 months of inactivity, not the age of each ringgit.
- RM10,000 stays. Only the balance above it is forfeited; below it, nothing is.
- Levy paid during those two years survives the forfeiture.
- Forfeiture is not the only exit. Deregistering sends the balance to HRD Corp's General Reserve, not back to you.
- Rescuing a balance takes weeks. The grant is approved before training starts; the claim is filed after it ends.
This is the deadline half of our HRD Corp vs SBL-Khas vs claimable courses guide: that one covers what the levy can pay for, this one what happens if you never spend it.
Expiry by inactivity
Does unused HRD Corp levy expire?
Yes, in effect. Section 25 of the PSMB Act 2001 lets HRD Corp withdraw eligibility from an employer that makes no claim within a set period. That period was cut from five years to two years on 1 January 2020, so an employer with no claim for 24 months loses the balance above RM10,000.
The statute's closing clause reads:
“the employer shall lose his eligibility to receive any financial assistance or other benefits not claimed for the period”
— Section 25, PSMB Act 2001, as reproduced in HRD Corp Employers' Circular No. 7/2019
The circular sets the period: the levy becomes ineligible when the balance has not been utilised within 24 months — no claims made within two years continuously. So the trigger is your claiming behaviour, not the age of each contribution. One successful claim inside the window protects the whole balance; none, and HRD Corp's support centre is blunt: any levy balance exceeding RM10,000 will be forfeited. Our levy rate guide covers the 1% and 0.5% bands.
What is actually taken
How much of the levy balance is actually forfeited?
Not all of it. HRD Corp takes the balance that was already sitting there two years earlier down to RM10,000 and leaves the levy you contributed during those two years alone. Nothing is forfeited where that earlier balance was already below RM10,000.
HRD Corp published worked scenarios. Two show the whole mechanic:
| Employer | Balance two years earlier | Claims in the two years | Levy paid in the two years | Forfeited | Left in the account |
|---|---|---|---|---|---|
| Employer B | RM100,000 | None | RM20,000 | RM90,000 | RM30,000 |
| Employer F | RM9,900 | None | RM5,000 | Nothing | RM14,900 |
Rows B and F of HRD Corp's examples of unutilised levy, Employers' Circular No. 7/2019, page 6.
Employer B kept RM10,000 of the old balance plus the RM20,000 paid during the window; Employer F, below the threshold, lost nothing. The bigger the payroll, the more there is to lose — our levy calculator shows what you add each month.
Your own start date
When does the two-year clock start for our company?
It runs from your last successful claim. An employer that has never claimed is measured instead from the levy statement date on which the balance first reached RM10,000 — so a company that registered and never trained is already on the clock.
- Open eTRiS — the levy account and its statements live in the HRD Corp system called eTRiS.
- Find your last approved claim date. That is day one of the current window.
- Never claimed? Find the statement where the balance first crossed RM10,000 and count from there.
- Check the registered inbox. HRD Corp says reminders go out by email and letter each month to employers categorised as inactive in levy utilisation — easy to miss once that contact has left.
Only a successful claim counts, so if yours was rejected, read our guide on appealing a rejected HRD Corp claim.
Where else the balance goes
What else can take levy out of the account?
Two routes, plus one that is not a loss. Forfeiture takes the balance already sitting there two years earlier down to RM10,000. Deregistration or cessation transfers what remains to HRD Corp's General Reserve, not back to the employer. An acquisition costs nothing: section 20(4) substitutes the acquiring employer, which keeps the benefit.
| Mechanism | What it does | What triggers it |
|---|---|---|
| Forfeiture | Takes the old balance down to RM10,000 | No successful claim for two years |
| Deregistration or cessation | The balance is transferred to HRD Corp's General Reserve | Business no longer covered by the Act, or under ten Malaysian employees for three consecutive months |
Winding an entity down is a reason to spend the balance first.
How long rescuing it takes
How long does it take to spend a levy balance?
Longer than most employers assume. The grant application must be in before the training date, the programme can only run after an advance-approval wait, and the claim is filed after it finishes. Nothing is backdated, so a balance discovered in the last fortnight of a window is usually lost.
- Pick a programme of at least four hours. HRD Corp funds in-house or public training from that duration.
- Apply for the grant in eTRiS first. The application must be submitted before the training date commences.
- Wait out the approval window. In-house programmes may run 14 days after grant approval; public ones three days after approval from 15 June to 31 December 2026, back to 14 days from 1 January 2027.
- Start within 90 calendar days of clearing that wait.
- File the claim within six months of the completion date.
Which costs may go in the claim is set by the Allowable Cost Matrix; whether your own programme qualifies is covered in is in-house training claimable.
What to do now
What should an employer do about a sitting levy balance?
Date the window from your last approved claim, book well before it closes rather than on the day, and spend it on compliance you need anyway — HRD Corp says the levy payment is itself a deductible business expense under the Income Tax Act 1967. SBL-Khas, SBL and the Industrial Training Scheme all draw on the balance; our claim guide walks the submission.
HRD Corp approved RM2.62 billion in financial assistance in 2025, 32% more than 2024, across more than 2.8 million training places, manufacturing alone taking more than 795,000 — its media release of 13 January 2026. Carriera Academy is an HRD Corp Approved Training Provider with workshops online via Zoom in tax, employment law, payroll, finance and Excel — the live course calendar shows what is dated and open.
Still have questions?
Unused HRD Corp levy — employer FAQ
Can unused HRD Corp levy be refunded in cash?
Does one small claim reset the two-year clock?
What happens to our levy if we deregister from HRD Corp?
Every rule on this page comes from HRD Corp: Employers' Circular No. 7/2019 (section 25, the two-year revision, the RM10,000 threshold, the worked scenarios), the levy forfeiture knowledge base (the formula, how the two years are counted), HRD Corp Claimable Courses (the four-hour minimum, approval windows, the 90-day and claim deadlines), the Employers FAQ (General Reserve, section 20(4), the schemes, the Income Tax Act 1967 point) and its media release of 13 January 2026. Reviewed 28 September 2026. General information, not legal or tax advice — check your own eTRiS statement.
Sitting on a levy balance you have not used?
Tell Steph your last claim date. Carriera Academy is an HRD Corp Approved Training Provider, so a claimable programme can be dated before your window closes.
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