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MPF Employer

MPF Employer


Coverage and Enrolment

My sons and daughters are helping me run my family business. Do I need to enrol them in an MPF scheme?
If you are a sole-proprietor or a partner in a business, the family members you have employed live with you, then you are not required to enrol them in an MPF scheme. However, if they do not live at the same address as you, MPF enrolment is required unless they are exempt persons.
I am running a business in the Mainland. Do I need to enrol my employees who are employed and work in the Mainland in an MPF scheme?
You are not required to enrol your Mainland employees in an MPF scheme. The MPF System is intended to provide retirement benefits only to members of the workforce in Hong Kong.
I employ a maid to undertake domestic work for me. Do I need to enrol her in an MPF scheme?
Employees who provide domestic services in the residences of their employer are exempt persons and are not required to join an MPF scheme.
I have hired a few overseas employees to work for me. Do I need to enrol these expatriates in an MPF scheme?
If the expatriates are given permission by the Government of the HKSAR to remain in Hong Kong for employment purposes and either (i) they are members of an overseas retirement scheme or (ii) the period during which they are given permission to remain in Hong Kong is 13 months or less, they are exempt from joining an MPF scheme.
An expatriate in our company was given permission by the Government of the HKSAR to stay in Hong Kong for nine months for employment, but later the permission was extended for another six months. Do I need to enrol him in an MPF scheme?
Assuming your expatriate employee is not covered by any overseas retirement scheme, as the original period (nine months) and the extended period (six months) together exceed 13 months, he/she ceases to be exempt starting the first day after the end of the 13th month. You therefore need to enrol your expatriate employee in an MPF scheme within 60 days from the end of the 13th month.
My expatriate employee is a member of an overseas retirement scheme. Does that scheme have to be approved or recognized by MPFA?
No. There is no requirement for an overseas scheme to be approved by, recognized by, or registered with MPFA. As long as the scheme is a scheme registered or domiciled outside Hong Kong, your employee who is a member of the scheme is automatically exempt from joining any MPF scheme.
I am a hawker and have a few employees working for me. How does the MPF System apply to me?
"Self-employed" hawkers, as defined by the Public Health and Municipal Services Ordinance (Chapter 132, Laws of Hong Kong), are exempt from joining any MPF scheme.

However, if you hire employees, then you are an employer. You must, in your capacity as an employer, enrol your employees in an MPF scheme and make contributions accordingly.
Does a student who takes part in an internship programme need to be enrolled into an MPF scheme?
If the student is employed as a regular employee for a continuous period of not less than 60 days, the offering organization is required to enrol the student into an MPF scheme within the first 60 days of employment and make mandatory contributions accordingly (unless the student is under 18 years old or an exempt person).

However, the above 60-day employment rule is not applicable to students employed as casual employees in the construction or catering industries. Employers of these two industries, whether they participate in MPF Industry Schemes or Master Trust Schemes, must enrol the student in an MPF scheme and make contributions.



Joining a Scheme

As an employer, do I have the right to choose an MPF scheme?
Yes. Under the MPF System, employers are required to enrol their relevant employees in an MPF scheme, and the final decision on choosing which MPF scheme rests with you.

You are encouraged, however, to consult your employees when selecting an MPF scheme for them. You may also join more than one MPF scheme so that your employees can choose the scheme and funds that best suit their needs.
What should I consider when choosing an MPF scheme?

There are many schemes available in the market, and you may wish to consult your employees on their priorities, so as to select an MPF scheme that is most suitable to all.

Some factors to consider as you look over schemes include:

  • types of constituent funds available under each scheme;
  • fees and charges payable under the scheme; and
  • quality of customer service offered by the trustee of the scheme.
How do I know whether a scheme has been registered with MPFA and whether a trustee has been approved by MPFA?

All registered MPF schemes and approved trustees can be found in online registers here or at MPFA offices.

Do I need to apply to MPFA before enrolling my employees in a particular MPF scheme?
No application to MPFA is required to participate in a Master Trust Scheme or an Industry Scheme, simply contact the trustee of the relevant MPF scheme to check out the enrolment procedures.
If I am not satisfied with the performance of the MPF scheme in which I have enrolled my employees, can I change schemes? What should I do?
Yes. You have the right to switch to another MPF scheme and transfer the accrued benefits of your employees to that scheme. To start the transfer process, you should apply in writing to the trustee of the new scheme. Upon receipt of your application, the new trustee will arrange with your existing trustee to complete the transfer.

Before switching to another MPF scheme, you are encouraged to communicate with your employees on the proposed arrangements well in advance.
What should I be aware of before I submit the MPF scheme enrolment form for my employee?
You should ensure that the following information is provided by the employee in the enrolment form:
  • the full name of the employee;
  • the HKID card number;
  • the date of birth;
  • contact information (residential address and telephone number);
  • the employee’s investment choices, if any; and
  • the self-certification.
The requirements relating to Automatic Exchange of Financial Account Information (AEOI) apply to MPF schemes starting from 1 January 2020. For all new MPF accounts open on or after 1 January 2020, the account holder (including employee and self-employed person) is required to complete a self-certification which includes tax residency (i.e. declaring whether he/she is a tax resident outside Hong Kong). The account opening procedures could not be completed by the trustee if the account holder fails to provide the self-certification.

For details in relation to AEOI, please visit the websites of Hong Kong Trustee’s Association and Inland Revenue Department.


Administrative Duties

What will I receive after I have registered my company in an MPF scheme?

After the scheme trustee has confirmed your company’s participation in an MPF scheme, it will provide your company with a notice of participation.  The notice of participation will state the name of the scheme, the name and address of the trustee of the scheme, the employer’s name and the issue date of the notice. 

With effect from 1 August 2015, the notice of participation replaces the notice of acceptance.

What should I do if my employee ceases employment?
Within 10 days after the last day of the calendar month in which the employee ceases employment, you must send a written notice to your MPF scheme trustee stating the date on which the employment ceased. Alternatively, you may inform the trustee of the employee's cessation of employment in the remittance statement.

If you are an employer in the construction or catering industries and have enrolled your casual employees into an Industry Scheme, the above procedures of notifying the trustee are not required.
I have changed my company address. Should I report this to MPFA?
No. You should contact your scheme trustee to update your company address.


Making Contributions

My employee's monthly income is above the minimum level of relevant income and below the maximum level of relevant income, but it fluctuates from month to month. Does that mean the employee's mandatory contributions also fluctuate?
Yes. The amount of mandatory contributions is based on the employee's relevant income in a contribution period. If your employee's relevant income fluctuates from month to month but remains within the minimum and maximum relevant income levels, his mandatory contributions, calculated as 5% of his relevant income, will fluctuate correspondingly.

Under the MPF System, it is your responsibility as an employer to ensure the calculations of your employees' relevant income and mandatory contributions are accurate.
I provide some non-monetary benefits, such as airline tickets, to my employees. Do such benefits form part of the "relevant income" of my employees?
No. Non-monetary benefits are not regarded as "relevant income".
Should compensation for a work-related injury (paid according to the Employees' Compensation Ordinance (Chapter 282, Laws of Hong Kong)) be included as "relevant income"?
No. Periodical payment under the Employees' Compensation Ordinance is not regarded as "relevant income".
I have recently terminated the employment of an employee through giving him payment in lieu of notice. Should the payment in lieu of notice be included as part of the “relevant income” of the employee and MPF contributions be made accordingly?
Payment in lieu of notice or redundancy payment paid by an employer or made by an employee to an employer (where the employer or the employee is entitled to terminate the employment after giving notice) would not be included as relevant income because it is a compensation for the employment termination or a statutory payment rather than consideration for services rendered.
What is a "contribution period" and how should I make contributions for each contribution period?
A contribution period is the period for which the employer pays relevant income to the employee. Under the MPF System, for monthly-paid regular employees, an employer is required to make mandatory contributions on or before the 10th day of each month (i.e. the "contribution day") unless it falls on a Saturday, a public holiday, a gale warning day or a black rainstorm warning day. In this event, 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. For example, if 10th January is Saturday, the contribution day will be postponed to 12th January (Monday). For the contribution day of each month in this year, please refer to the "MPF Contribution Days" Calendar.

Employers in the construction and catering industries who have enrolled their casual employees in the Industry Schemes may choose to make mandatory contributions either on the next working day (i.e. any day other than a Saturday, a public holiday, a gale warning day or a black rainstorm warning day) following the relevant pay-day, or within 10 days after the relevant contribution period.

(Note: The contribution day is not affected by the "pay day", i.e. whether the employer pays the employee at, before or after the end of the month is irrelevant.)
The law only requires me to pay a mandatory contribution of 5% of my employees' income. Can I make extra contributions for my employees?
Yes. You are free to make voluntary contributions for your employees. You may contact your trustee regarding the rules governing voluntary contribution amounts, payment method, vesting and withdrawal of benefits derived from voluntary contributions.
I posted the cheque to the trustee on the contribution day, why am I considered late in paying contributions?
Employers should allow sufficient mailing time to ensure that the payment cheque and remittance statement are delivered to the trustee on or before the contribution day. Please note that the postmark date on the envelope will not be considered as the date of payment.

For other points-to-note on making contributions, please refer to the Employers’ Common Misconceptions in Handling MPF Contributions.
I am required to provide a remittance statement when I pay mandatory contributions to my scheme trustee. What should be included in the remittance statement?
The remittance statement should include the following information in respect of each employee:
  • the employee’s relevant income for the contribution period;
  • the employer’s mandatory contribution;
  • the employee’s mandatory contribution;
  • the employer’s voluntary contribution, if any; and
  • the employee’s voluntary contribution, if any.
How do trustees facilitate employers' work in making MPF contributions and managing their employees' records?
Trustees can help by offering employers the option of using a remittance statement template. This template is sent out before the end of the contribution period, and shows the most recent information (such as relevant income and contributions details) received by trustees in respect of each relevant employee. Trustees will also provide employers with clear information on how to contact trustees if these templates fail to arrive by the expected date, and how to amend the information before returning the template as a completed remittance statement to trustees.

In addition, some trustees provide additional services, such as:
  • an enquiry hotline;
  • monthly statements;
  • online access to transaction details and contribution information; and
  • payroll software to manage employee records and to facilitate the preparation and electronic submission of remittance statements.
Should I inform my employees of the amount of mandatory contributions made on their behalf?
Yes. As an employer, you are required to provide monthly pay-records to each of your employees. The pay-record must be provided within seven working days after mandatory contributions are made and should include:
  • the employee’s relevant income;
  • employer and employee contribution amounts, both mandatory and voluntary, if any; and
  • the date that contributions were paid to the trustee.
What happens if I fail to settle the payment of mandatory contributions for my employees?
An employer who fails to make mandatory contributions for his employees on time is liable to a surcharge calculated at 5% of the amount of default contributions. The surcharge is fully vested in the employees’ MPF accounts. The employer should contact the trustee to enquire about the amount of surcharge and settle the default contributions and surcharge together as soon as possible without waiting for the payment notice issued by MPFA.
A financial penalty of $5,000 or 10% of the amount of default contributions (whichever is greater) may be imposed on defaulting employers. Prosecution may also be initiated against defaulting employers with a maximum penalty of four years’ imprisonment and a fine of $450,000.

You may find more information here .


Offsetting of Long Service Payment (LSP) and Severance Payment (SP) against MPF contributions

What does offsetting of MPF mean?
The offsetting of MPF is the arrangement of offsetting LSP/SP with MPF contributions made by an employer. Under the Employment Ordinance, employers have long been allowed to use their contributions made to retirement schemes to offset LSP/SP paid to their employees. When the MPF System was legislated, the same arrangement was inherited. After paying LSP/SP to their employees, employers can withdraw the same amount from the accrued benefits derived from the employer’s contributions in the employee’s MPF account. Please click here for more details on the offsetting arrangement.
Is the amount that an employer can use to offset LSP/SP the actual amount of contributions paid by the employer or the accrued benefits (i.e. contributions and investment returns) derived from the employer’s contributions?
It is the accrued benefits derived from the employer’s contributions.
If an employer makes voluntary contributions for his employee, can the voluntary contributions be used for offsetting LSP/SP as well?
Yes. The accrued benefits derived from the employer’s contributions, including both mandatory and voluntary contributions, can be used for offsetting LSP/SP.
If an employer paid an amount of LSP being more than what is required under the Employment Ordinance, can he also offset the amount in excess from the employee’s MPF account?
No. The maximum amount that the employer can withdraw from the employee’s MPF account is the amount of LSP required to be paid. Thus, the amount paid in excess cannot be offset.

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