Simplify MPF Contributions and Reporting with Omni

Master trust schemes

These are the most common types and are open to employees from various employers as well as self-employed individuals. They pool contributions from multiple participants, making them ideal for small and medium-sized enterprises due to shared administrative costs.

Employer-sponsored schemes

This type is designed for larger companies; these schemes are exclusive to the employees of a single employer. They allow companies to tailor their retirement plans specifically for their workforce.

Industry scheme

These are established for specific industries, such as catering and construction, where employee mobility is high. They cater to the unique needs of workers within those sectors, providing a focused approach to retirement savings.

Mandatory contributions

Both you and your employees are to allocate 5% from their monthly earnings into their MPF accounts. The system requires employee and employer contributions based on monthly salary amounts but is limited to HK$30,000 maximum and above HK$7,100 minimum. 

For example, the monthly contributions for employees who earn HK$20,000 consist of a HK$1,000 amount from both the employee and the employer.

With Omni, MPF contributions are automatically calculated based on employee salary and seamlessly integrated with the payroll system, allowing employers to track and allocate correct contributions according to selected MPF Hong Kong schemes, ensuring accurate deductions and reducing administrative burden.

“Payroll calculations that used to take three to five working days can now be done in half the time.”
— Tengku Mohaizad, Group Head of HR Asia, Inspire Brands Asia

Vesting

The contributions you make to your employees’ MPF Hong Kong accounts are fully and immediately vested in them. This means that all the benefits that build up from your contributions exclusively belong to your company employees. 

You may use employee contributions to reduce severance or long-service payments; however, this will no longer be the case after 1 May 2025 due to the elimination of the MPF Offsetting Mechanism. 

Tax benefits

While your mandatory contributions aren’t tax-deductible, you can still benefit from lowered payroll costs due to the tax deduction eligibility for your employees contributions.

Plus, offering voluntary contributions can be a great way to improve employee benefits and attract and retain top talent. It’s a win-win for both you and your team.

Withdrawal conditions

Accumulated benefits become accessible to staff members when they turn 65 years old or qualify for drawdown benefits at age 60 and after departing from Hong Kong permanently or suffering from total incapacitation or terminal illness. 

If an employee decides to retire earlier at age 60, their MPF Hong Kong savings become accessible to them at that time.

Employer and employee

For both employers and employees, the contribution rate is 5% of the employee's salary, as shown on the table below. Also, the MPF Hong Kong maximum contribution is HK$1,500 per month for both employers and employees when the income exceeds HK$30,000.

Contributions under this system have regular monthly timings, and the payments need to be made by the 10th day of the month or the following work day when the ten falls on a weekend or public holiday. 

Omni’s reporting and analytics provides detailed payroll reports, including MPF contributions, making it easier than ever to track and manage contributions and ensure full compliance with MPF Hong Kong requirements.

Employer and employee contribution table

Self-employed persons (SEPs)

The requirement for a self-employed person is mostly the same, with a contribution rate of 5%, and the contributions are typically made quarterly, with payments due by the 10th day of the month following the end of each quarter.

The main difference in both is that for employers and employees, the MPF Hong Kong contribution responsibility is shared, but a self-employed person carries it alone.

Self-employed person contribution table

Withdrawal of benefits

As stated earlier, once employees reach official retirement or have any conditions under the withdrawal conditions listed, they can get their accrued MPF benefits. 

For employers

• Failure to enroll employees: The penalties for employers who fail to properly enroll their workers in MPF schemes reach a maximum of HK$350,000 along with three years of imprisonment.
• Failure to make deductions: Deducting contributions from employee salaries without paying them to the trustee can result in a maximum penalty of HK$450,000 and imprisonment for four years.
• Late contribution: The cost of late contribution payment amounts to the greater value between HK$5,000 and 10% of the actual amount due.
• Providing false information: Employers face penalties of HK$100,000 and a one-year jail sentence for first-time convictions; once it becomes two, the fines rise to HK$200,000 with two years imprisonment.
• Failure to provide pay records: Not providing monthly pay records to employees will cost employers a HK$10,000 fine for their first offense and twice that amount for the second offense and HK$50,000 fines for any subsequent offenses. 
• Failure to notify trustees of employment cessation: Employers must notify their trustees about employment termination, as failure to do so will lead to HK$5,000 for first offenses up to HK$20,000 for each succeeding offense.
• Failure to notify trustees of employer information updates: This has the same fine for failing to update employer information with trustees. 

For self-employed individuals

• Failure to enroll: Non-compliance leads to HK$50,000 fines and six months imprisonment starting from their first offense and maximum fines of HK$100,000 paired with one-year jail time upon subsequent offenses.
• Failure to make contributions: Self-employed individuals who neglect their MPF Hong Kong contributions must pay the higher of HK$5,000 or 10% of the required contribution.
• Providing false information: Providing false information can also result in prosecution or penalties similar to those for employers.

Non-compliance with MPF Hong Kong regulations can result in significant penalties. Omni eliminates the risk by helping businesses stay on top of their responsibilities with automated updates notifying you of upcoming MPF contribution due dates.

1. How does MPF work in Hong Kong?

MPF (Mandatory Proficient Fund) is a compulsory retirement savings scheme for employees and self-employed individuals aged 18 to 64. Both employers and employees contribute 5% of the employee’s relevant income, subject to a minimum of HK$7,100 and a maximum of HK$30,000 per month.

2. Can I choose my MPF provider?

Yes, as an employee, you can choose your MPF provider if your employer offers multiple schemes or if you want to make voluntary contributions. Self-employed individuals select their own MPF service provider.

3. When do I start contributing to MPF?

Your contributions start after the first 60 days of employment, whether you’re a full-time or part-time employee. Casual employees must be enrolled on their first day of work. 

4. What is the MPF Hong Kong maximum contribution?

The maximum contribution is HK$1,500 per month for both employers and employees when the income exceeds HK$30,000.

5. Is MPF taxable in Hong Kong?

Mandatory HK MPF contributions are not taxable, but they are tax-deductible for employees. Employers cannot claim tax deductions for their mandatory contributions.

6. Can I collect MPF if I leave Hong Kong?

Yes, you can withdraw your MPF benefits if you permanently leave Hong Kong.

7. How to withdraw MPF when leaving Hong Kong?

You need to notify your MPF trustee and provide proof of permanent departure from Hong Kong to initiate the withdrawal process.