Information Centre

Many young people are drawn to a flexible working mode. “To be their own boss” is the preferred lifestyle of those to choose to be self-employed. However, this working style demands strong self-discipline, especially when it comes to retirement planning. Under the MPF System, self-employed persons (SEPs) are required to proactively make their own MPF contributions. Unlike regular employees, SEPs do not have an employer to enrol them in an MPF scheme, so they must enrol in an MPF scheme by themselves. Here are some tips for SEPs to get started!

Tip 1: Choose an MPF scheme and set up an account

You are required to enrol in an MPF scheme and open an SEP account within the first 60 days of becoming self-employed. When choosing the MPF scheme that suits you best, you should consider factors such as your investment goals, life stage and risk tolerance level. If your preferred MPF scheme has already onboarded to the eMPF Platform (eMPF) and you have registered an eMPF account, you can set up an MPF account and handle all MPF administration tasks via the eMPF. Please visit the eMPF Platform website for more information.

Tip 2: Report your relevant income

As an SEP, your income may be unstable. When calculating your MPF contributions, they must be based on the total relevant income in the previous year. You must report your relevant income for the next financial period to your trustee at least 30 days before the end of each financial period of the scheme.

SEPs can determine their relevant income in one of the following ways:

1. Taking the assessable profits stated in their most recent notice of assessment issued by the Inland Revenue Department;
2. Taking the basic allowance as defined under section 28 of the Inland Revenue Ordinance;
3. Making an income declaration to their trustee; or
4. Taking the maximum relevant income level per year as their relevant income.

Tip 3: Make voluntary contributions to enhance your retirement protection

SEPs value flexibility and autonomy in their work, and that is exactly why tax-deductible voluntary contributions (TVC) can be a perfect fit. In addition to enhancing retirement reserves, TVC offer tax deductions, which is a win-win for SEPs. What makes TVC especially appealing is its flexibility. Scheme members can flexibly adjust the contribution amount, suspend or resume TVC, according to their personal needs and financial capability. 

The MPFA encourages SEPs to plan ahead for the future and make good use of the MPF System to steadily build up their retirement roadmap.