Hong Kong MPF Contribution Guidelines

Hong Kong MPF Contribution Guidelines

1. The right way to set up an MPF account?
Organising an MPF account is a straightforward process. Hong Kong’s Obligatory Provident Fund Schemes Creatority ("MPFA") maintains a list of MPF Approved Trustees which employers could consider. As an illustration, the HSBC MPF plan provides individuals with a wide number of investment schemes equivalent to those targeted more on international bonds, Hong Kong and Chinese equities and so on. Simply contact your chosen MPF providers and full the related employer application varieties for the scheme of your choice. As soon as an employer has successfully enrolled in an MPF scheme, they will be issued an employer’s identification number, demonstrating your obligation to assist your staff in their retirement schemes.

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2. What are an employers’ obligations under the Hong Kong MPF regulations?
Employers must additionally complete the one-time obligation of aiding their workers in opening MPF accounts. Except for exempt persons, an employer ought to enroll both full-time and part-time workers who're a minimum of 18 but under sixty five years of age in an MPF scheme within the first 60 days of their employment. Nonetheless, if an employment relationship ends prior to the 60th day of employment, no MPF arrangement is required.



Upon profitable enrollment, employers should meet ongoing obligations of remitting contributions to their workers MPF schemes once each contribution period. Contributions for monthly-paid full-time employees are typically made on the tenth day of each month.



Employers and staff are each required to make common necessary contributions to an employees MPF scheme. The MPF employee contribution and MPF employer contribution should every be 5% of the worker’s related earnings, topic to relevant income levels. For a month-to-month-paid worker, the minimal and most related revenue ranges are $7,one hundred and $30,000 respectively.



To make payments to their employees, employers are required to calculate their worker’s related income and the quantity of mandatory contribution that must be made for every contribution period. The employer should then deduct the calculated amount from their worker’s earnings and remit that sum to their MPF account.



3. What are the employee contribution rules under the Hong Kong MPF regulations?
Employees don't face as many compliance obligations as their employers do. Nevertheless, it is vital for employees to make sure that they make the common necessary contribution of 5% of their related income to their related scheme as talked about above.



4. Are there exemptions under a Hong Kong MPF contribution rules?
Not all staff working in Hong Kong must be enrolled under an MPF scheme. Expatriates residing in Hong Kong for employment functions can get hold of permission to be exempted by the Hong Kong Government. Permission can only be granted if the worker in query is either a member of an overseas retirement scheme, or will reside in Hong Kong for a interval of thirteen months or less.



5. Penalty
Within the event an employer fails to adhere to their MPF obligations, the MPFA will situation the employer with a "surcharge discover". This notice will impose a 5% surcharge on default contributions and the surcharge obtained will go solely to the worker’s MPF account. In addition, defaulting on contributions is a criminal offence and the defaulter is liable to a most penalty of a HK$450,000 fine and imprisonment for 4 years. Employers who've failed to comply with their MPF employer obligations are liable to potential financial penalties of HK$5,000, or 10% of the default amount, whichever is bigger, on the defaulting employer.



Conclusion
We understand that issues referring to MPF calculation and payroll administration are time-consuming tasks that require a significant amount of the corporate’s resources. FastLane can handle these essential enterprise tasks, corresponding to payroll, MPF account setup and your worker’s enrollment into your chosen MPF scheme on your behalf.

For those who have almost any inquiries concerning exactly where and the way to utilize MPF calculator, you are able to contact us in our own page.

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