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Industry Schemes

For employer in the construction and catering industries


Making Contributions

While opening an MPF account for your employees is a one-time job, making contributions for them is not. You will need to remit contributions for your employees once every contribution period (generally the wage period). Many employers think that making contributions means paying up on time every month. There is indeed more to it than that. Here is what you should observe when making contributions for your employees.

Calculating, Deducting and Remitting Contributions

Employers and employees are each required to make regular mandatory contributions of 5% of the employee’s relevant income to an MPF scheme, subject to the minimum and maximum relevant income levels. For a monthly-paid employee, the minimum and maximum relevant income levels are $7,100 and $30,000 respectively. The table below shows the amount of mandatory contributions for you and your employees.

Monthly Relevant Income Mandatory Contributions
Employer Portion Employee Portion
Less than $7,100 Relevant income x 5% No contribution required
$7,100 to $30,000 Relevant income x 5% Relevant income x 5%
More than $30,000 $1,500 $1,500

The current minimum relevant income level of $7,100 per month applies to contribution periods commencing on or after 1 November 2013 while the current maximum relevant income level of $30,000 per month applies to contribution periods commencing on or after 1 June 2014.

For more details on the past minimum and maximum relevant income levels, please click here.

If you are an employer in the construction or catering industry, please click here for more information on how to calculate contributions for casual employees under Industry Schemes.

"Relevant income" refers to all monetary payments paid or payable by an employer to an employee, including wages, salary, leave pay, fees, commissions, bonuses, gratuities, perquisites or allowances, but excluding severance payments or long service payments under the Employment Ordinance (Chapter 57, Laws of Hong Kong).

Note: As an employer, you can make voluntary contributions in addition to mandatory contributions for your employees. Please click here for more details.

You are required to calculate your employee's relevant income and the amount of mandatory contributions for each contribution period (wage period), deduct the amount from the employee’s income as their mandatory contributions, and remit to the MPF trustee the employee’s contributions, together with the employer’s contributions from your own funds.

The mandatory contributions for a contribution period should be remitted to your MPF trustee on or before the contribution day. Generally, for monthly-paid employees, the contribution day is the 10th day of each month. For example, the contributions for the contribution period of September should be paid to your trustee on or before 10 October. For the contribution day of each month in this year, please refer to the "MPF Contribution Days" Calendar.

Note: If the contribution day falls on a Saturday, a public holiday, a gale warning day or a black rainstorm warning day, the contribution day is extended to the next following day which is not a Saturday, a public holiday, a gale warning day or a black rainstorm warning day.

Making a First-time Contribution for Your New Staff


Arranging a first-time contribution for your new staff is bit tricky given an employer is not required to arrange MPF for his employees who have not been employed for 60 days or more (except for casual employees in the construction and catering industries). Technically, the first contributions should be paid to your trustee on or before the 10th day after the last day of the calendar month on which the 60th day of employment falls. Already lost? Here’s an example to illustrate how it works.

You have employed Angela as a System Analyst and her first day of employment is 5 June. Since her 60th day of employment falls on 3 August, i.e. within the contribution period of August, your first-time contributions for Angela, both employer’s and employee’s portions, should be made on or before the 10th day of the month following August, i.e. 10 September.

Your first-time contribution for Angela is therefore made three months after her first day of work, and that’s perfectly fine and how it should be done.

Contribution Holiday

As an employer, you should make contributions for your employees from the first day of their employment. Your new employees, however, enjoy a “contribution holiday”, meaning they are not required to make contributions for the first 30 days of employment and

(i) any incomplete payroll period that immediately follows the 30-day period (if the employee’s wage period is monthly or shorter than monthly); or
(ii) the calendar month in which the 30th day of employment falls (if the employee’s wage period is longer than monthly).

Sounds complicated? Let us show you how it works using Angela’s case.

Angela’s first day of employment is 5 June. Since she enjoys a contribution holiday for the first 30 days of employment, her income earned during the 30-day period, i.e, from 5 June to 4 July, should not be deducted for her MPF contribution.

In addition, since her 30th day of employment falls in July (being the incomplete wage period that immediately follows the 30-day period), MPF deduction for the whole of July is also waived for her. You should therefore only deduct Angela’s income for the contribution period of August and remit the contributions to your trustee on or before 10 September.

Given the contribution holiday does not apply to the employer, your contributions for Angela should be calculated from her first day of employment, i.e. 5 June.

In other words, when you make your first contributions for Angela on or before 10 September, the employer’s contributions should cover the period from 5 June to 31 August.

Remittance Statement

When remitting each payment of contributions to your MPF trustee, you must also provide your trustee with a remittance statement showing the amount of each employee’s relevant income, and the amounts of both employer’s and employee’s contributions for each of your employees. The remittance statement is an important document as it tells the trustee how to allocate the contributions into the account of each of your employees. Without the remittance statement, your trustee simply cannot further process the contributions you have remitted.

The remittance statement can be in written or electronic form. Some trustees provide software for you to prepare and submit the remittance statement online and some provide a pre-printed remittance statement to save your time in filling out the document every month. Please contact your trustee to see how they can help you with preparing the remittance statement.

Tax Deduction

Employers can claim tax deductions for their mandatory and voluntary contributions, to the extent that they do not exceed 15% of their employees’ total emoluments.

Penalty for Non-compliance

The MPFA will issue a “surcharge notice” to a defaulting employer to impose a 5% surcharge on default contributions. The surcharge received goes entirely to the employee’s MPF account.

Defaulting on contributions is a criminal offence and the defaulter is liable to a maximum penalty of a $450,000 fine and imprisonment for four years. The MPFA can also impose a financial penalty of $5,000 or 10% of the default amount, whichever is greater, on the defaulting employer.

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