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Reduction of Statutory Contribution Rate For Employees – 11% to 7%

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Reduction of Statutory Contribution Rate For Employees – 11% to 7%

With reference to the Government’s announcement on the 2020 Economic Stimulus Package on 27 February 2020, the employee’s share of the Employees Provident Fund (EPF) statutory contribution rate will be reduced from 11 per cent to seven (7) per cent.

1.    The new statutory contribution rate for employees will affect April 2020’s wage (May 2020’s contribution) up to December 2020’s wage (January 2021’s contribution) subject to the Third Schedule of the EPF Act 1991.

2.    The new statutory contribution rate for employees applies to those below 60 years old who are liable for contribution. The statutory contribution rate for employees aged 60 years old and above however, remains unchanged.

Option to maintain employee contribution rate of 11 per cent 
Members may choose to maintain the employee contribution rate at 11 per cent by completing Borang KWSP 17A (Khas 2020). This form must be submitted to the EPF via employers and will take effect from the following month. Download the form here: https://www.dropbox.com/s/r5im49mzxlcyk0z/Borang%20KWSP%2017A%20%28Khas%202020%29.pdf?dl=0

 

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admin administrator

Chcheah is the master trainer and proadvisor of Quickbooks Online. He is a Chartered Accountant by profession with a Bachelor of Science in Accounting and Finance (Hons). He is also a fellow member of Association of Chartered Certified Accountant (FCCA) and Malaysian Institute of Accountants (MIA). Additionally, he is also a Certified Financial Planner (CFP) and a qualified Pembangunan Sumber Manusia Berhad (PSMB) Train the Trainer (TTT / 7204). He has more than fifteen (15) years working experiences in both SME and multinational companies.