Important Notice

Your company's MPF contribution and related documents must be received by Principal and not by your MPF intermediaries before its receipt can be confirmed, as such please send your company's MPF contribution directly to Principal to avoid missing the contribution deadline.

  1. What are the employer's duties under MPF regulations?
    • As an employer, you will be responsible for the following:

      • Ensure your employees become members of an MPF scheme
      • Calculate relevant income and contributions
      • Pay contributions not later than the 10th day of the following month after each contribution period end date
      • Notify the trustee of member termination of employment within 10 days after the last day of the calendar month in which the employee ceases employment
      • Assist employees in making voluntary contributions
      • Notify the trustee of any changes of employer particulars or employee particulars within 30 days
      • Assist employees in completing the election form for the transfer of accrued benefits
      • Provide a remittance statement to the trustee detailing each contribution payment
      • Provide a monthly pay-record to employees showing relevant income, amount of contributions and contributions payment date
      • Keep records for employees
      • Keep the information required to be included in the remittance statement
      • Display an MPF participation certificate in the office
  2. I have hired a few overseas employees to work for me. Do I need to enroll these expatriates in MPF schemes?
    • If the period during which your expatriate employees is given permission to land or remain in Hong Kong for employment purposes does not exceed 13 months, or if the expatriate employees are members of a provident, pension, retirement or superannuation scheme run in a jurisdiction outside Hong Kong, they are exempted from the MPF Schemes Ordinance and do not need to join an MPF scheme. (Source: MPFA Website)

  3. Our company has set up a factory in China and some of my Hong Kong-based employees are working there. Are they required to join an MPF scheme?
    • Yes. No matter where they work, if they are employed by your Hong Kong company you will be responsible for providing them with an MPF scheme.

  4. Does my company incur a penalty if I forget to pay MPF contributions on time?
    • If you fail to pay the contributions on time, the trustee will inform the MPF Schemes Authority. You will then be liable to pay a contribution surcharge of 5% on the outstanding amount imposed. A financial penalty of HK$5,000 or 10% of contributions in arrears (whichever is greater) may also be imposed.

  5. If an employee resigns, can he withdraw any accrued benefits?
    • Under MPF, all accrued benefits derived from mandatory contributions must be preserved until the retirement age of 65 or certain withdrawal conditions are met. Voluntary contributions do not necessarily need to follow the MPF rules and therefore can be withdrawn upon termination of employment subject to the plan rules set out by the employer.

      For MPF exempted ORSO schemes, the arrangement will be different. Existing members who join the scheme before the MPF implementation date can withdraw accrued benefits upon termination of employment. However, for new members who join after the MPF implementation date, they are subject to a "Minimum MPF Benefits" rule and only benefit amounts exceeding this level can be withdrawn upon termination of employment.

  6. If an employee continues to work for the company after the retirement age of 65, does the company need to contribute for this employee?
    • The company and the employee are not obliged to make MPF contributions after the employee attains the retirement age of 65. However, both the company and the employee can make voluntary contributions if they wish to.

  7. Under the MPF, the mandatory contributions of 5% are tax deductible. How are voluntary contributions treated?
    • Employers can enjoy tax exemption on their total mandatory and voluntary contributions subject to a maximum of 15% of the total emoluments of the employee(s). However, any voluntary contributions made by an employee are subject to Salaries Tax. Please note that employee mandatory contributions are not subject to Salaries Tax up to a maximum limit of HK$15,000 per year.

      When an employee receives accrued benefits from an MPF scheme, the benefit amount is not usually subject to tax, except for any amount that is derived from the employer's voluntary contributions, to the extent that the amount exceeds the "Proportionate Benefits" as defined in the Inland Revenue Ordinance. Then, the excess portion is subject to tax.

      "Proportionate Benefits" is defined as the number of completed months of service divided by 120, then multiplied by "Accrued Benefits". The accrued benefits for the purpose of this calculation will be the full amount of benefits derived from the employer's voluntary contributions. For example, if an employee worked for 4 years, the proportionate amount will be 40% (i.e. 48/120) of the accrued benefits.

  8. What would I receive after I have enrolled my employees in an MPF scheme?
    • After your application for membership of an MPF scheme is submitted, you will be given notice of acceptance within 30 days from the date on which you submit all the information required for the application, or from the date on which you agree to observe and accept the governing rules of the scheme, whichever is later.

      Your scheme trustee will report your participation in the scheme to the MPFA. Upon receipt of such information, the MPFA will issue a participation certificate to you. If you are an employer, you are required to display this participation certificate at the premises where your employees were employed. If your employees do not perform work at your premises, you should display the certificate at your principal place of business. The displayed certificate may either be the original certificate or a certified copy issued by the MPFA.

  9. What should I do if I need to pay Severance or Long Service Payments ("SP/LSP") to my employee?
    • An employer is bound by the Employment Ordinance to pay SP/LSP to an employee where applicable. After paying the SP/LSP, you can apply to your scheme trustee to withdraw the relevant amount from the accrued benefits derived from your mandatory contributions (and voluntary contributions, if any) to offset the SP/LSP. If no instruction is given by the employer, long service payment/severance payment will be offset by members voluntary contribution followed by Employers mandatory contribution.

  1. I am a director of a company. Do I need to join an MPF scheme?
    • If your appointment as a company director is under a contract of employment and you receive remuneration as an employee, then you need to enroll in an MPF scheme. However, if you are a non-executive director who is not involved in the daily operations of the company, you are not required to enroll in an MPF scheme. (Sources: MPFA Website)

  2. I have a full-time job and two part-time jobs. Do I need to make MPF contributions in the part-time jobs if I have already made MPF contributions in the full-time job?
    • It depends on the employment period and the relevant income of your part-time jobs. If the employment period is more than 60 days, you are required to join the MPF scheme of respective employer. However, if your income is less than HK$7,100, you do not need to contribute but your employer does.

  3. Under my existing ORSO scheme, I can switch my investment funds once a year. Can I switch my investment choices under MPF?
    • Yes. According to the MPF Schemes Ordinance, the MPF trustee must at least provide you with one fund switching per year. Hopefully, providers will allow for more frequent switches (for example, Principal intends to do so).

  4. Can I choose an MPF scheme and request my employer to enroll me in that scheme?
    • Your employer has the obligation to select an MPF scheme for you. You can present your views to your employer but the final decision on which MPF scheme to join rests on your employer.

  5. How do I know whether my employer has enrolled me in an MPF scheme?
    • After your employer has enrolled you in an MPF scheme, the trustee of the scheme is required to provide you with an acceptance notice within 30 days, and a membership certificate within 60 days. Click here for a sample of member certificate.

      In addition, the MPFA will issue a participation certificate to your employer and he is required to have it displayed at the premises where you work.

  6. What information or documents will I receive from the scheme trustee after I become a scheme member?
    • You will receive from the trustee the following information:

      • a membership certificate stating the name of the scheme, the name and address of the approved trustee of the scheme, your name and the date of the certificate;
      • a document containing a general description of the scheme including the fees and charges payable under the scheme, particulars of the constituent funds in the scheme, name and contact details of the person to whom enquiries about contributions and related matters may be made; and
      • an annual benefit statement containing information about the contributions paid and investment returns for the year concerned.
  7. Who will decide on the choice of investment funds in an MPF scheme?
    • If more than one constituent fund is offered by the MPF scheme, you may choose one or more of the funds in which to invest your contributions. Your scheme trustee is required to provide particulars of the funds within 60 days of your enrolment, such as their policy regarding the kinds of securities and other assets in which the individual constituent fund may invest, the investment managers involved, and so on.

      You can make your own choice according to your investment objectives, personal circumstances and future plans. For example, a scheme member approaching retirement age may choose a lower risk investment product, while a younger member may choose to invest in a product with higher risks, but which may derive better investment returns.

  8. Can I change my mind later, after I have selected my initial investment portfolio?
    • Your scheme trustee is required by law to provide you with a choice to switch your investment portfolio at least once a year. Whether you can switch investments more than once during a year is subject to the governing rules of your scheme.

      For Principal members, you can change your investment choices through the following channels.

      • "Principal TeleTouch®" at 2827 1233. Simply follow the instructions and key in your new investment direction.
      • Login to Principal Retirement Centre and send us your instruction for investment direction online.
      • Alternatively, you can send us the Change of Investment Choice by Member Form.
  9. How can I check my retirement account balance?
    • You can check your account balance through the following channels:

      • "Principal TeleTouch®" at 2827 1233.
      • Login to Principal Retirement Centre
      • We will also send you an annual benefit statement after the end of each scheme year, summarizing the contributions and investment activities of your retirement account.
  10. How do I handle my accrued benefits when changing jobs?
    • If you change your job, you may opt for one of the following three ways to handle the accrued benefits in your MPF accounts:

      • Transfer the accrued benefits to another scheme your new employer participates in; or
      • Retain the accrued benefits in the same scheme (i.e. in a personal account in the same scheme); or
      • Transfer the accrued benefits to a personal account in another scheme (i.e. in another personal account). (Sources: MPFA Website)
  11. If I would like to transfer my accrued benefits from my ex-employer's MPF account to another MPF scheme, what should I do?
    • You should fill in a scheme member's request for fund transfer form and then submit it to your new scheme trustee or your new employer. The form can be obtained from your trustee and downloaded from MPFA website.

  12. If I am unemployed for a long period of time, can I withdraw my accrued benefits to meet living costs?
    • No. Your MPF benefits can only be withdrawn under the following situations:

      • Attaining the retirement age of 65 years
      • Total incapacity
      • Terminal illness
      • Death
      • Permanent departure from Hong Kong
      • Meeting small balance provision (essentially less than HK$5,000)
      • Attaining 60 years of age and permanently ceasing the employment or self-employment
  13. How do I withdraw my accrued benefits?
    • If you have attained the age of 65, you may present your identity card (or a copy of your identity card) and a completed Claim Form for Payment of Accrued Benefits to your scheme trustee to withdraw your accrued benefits. (Sources: MPFA Website)

  1. For temporary staff and freelance staff, do they have to join an MPF scheme? What about employees who are recruited on a contract basis, say three months or six months?
    • MPF regulations do not provide any exclusion for temporary or contract staff. However, if the employee is an expatriate who comes to work in Hong Kong for a period of less than 13 months, this person is excluded from the MPF coverage. Freelancers will be treated as self-employed persons and therefore required to join an MPF scheme.

  2. I am the Director of a company. How much do I need to pay for mandatory contributions?
    • If you are a salaried director, you are regarded as an employee. Both you and the company are required to contribute 5% of your monthly income (subject to a maximum of HK$3,000 in total) (with effect from 1 June 2014). If you are a sole proprietor or a partner in partnership business, you will be classified as a self-employed person and required to contribute 5% of your income.

  3. Is a sole proprietorship or partnership or partnership without any employees required to set up an MPF scheme?
    • The sole proprietor or partner in a partnership will be regarded as a self-employed person and is required to contribute to an MPF scheme for their own retirement benefits. If the sole proprietor or partner is earning less than HK$7,100 per month or HK$85,200 per year, no contribution is required. If the person is earning more than these amounts, they need to contribute 5% of their income to an MPF scheme as mandatory contributions, subject to a maximum of HK$1,500 per month or HK$18,000 per year (with effect from 1 June 2014).

  4. Do self-employed people contribute 5% or 10% of their relevant income?
    • The self-employed people are only required to contribute 5% of their relevant income from their own resources. However, they can also make additional voluntary contribution to the scheme.

  5. When should I pay the mandatory contributions?
    • You may choose to contribute on a monthly or yearly basis. If you choose to contribute on a yearly basis, you should pay your mandatory contributions to your scheme trustee by the end of each financial year of the scheme. If you choose to contribute on a monthly basis, you should specify to your scheme trustee a monthly date as your contribution day and make your monthly mandatory contributions by that date each month. You should inform your scheme trustee whether you want to contribute on a monthly or yearly basis when you first enroll in an MPF scheme. For the next financial year of the scheme, you should inform your scheme trustee of your choice (monthly or yearly) at least 30 days before the end of each financial year of the scheme. (Sources: MPFA Website)

  6. What if I am both a self-employed person and an employee concurrently?
    • You have to be enrolled in two MPF schemes. As a self-employed person, you have to enroll yourself in an MPF scheme. As an employee, your employer is required to enroll you in an MPF scheme and make mandatory contributions, when you have been employed under an employment contract for 60 days or more. (Sources: MPFA Website)

  1. What will happen to my MPF money if I transfer/ retain them in a personal account when I switch jobs?
    • Your money will roll-over in the account, that is why it is commonly known as roll-over account. Due to larger pool of asset size, retaining and merging accrued benefits in one consolidated personal account may save you additional fees and charges.

  2. Where do my future contributions go after opening a personal account?
    • Your future contributions from new employers will go into the new employer's MPF scheme instead of the personal account.

  3. If I am dismissed due to misconduct, can my employer keep the employer's portion of my accrued benefits and only allow me to transfer the employer's part to the personal account?
    • No. Your employer cannot withhold your benefits accrued from mandatory contributions. It will be vested fully as your accrued benefits once they are paid to your trustee. However, for voluntary contributions paid by your employers, forfeiture of benefits will be subject to the governing rules of your scheme.

  4. Will there be any charge for the transfer of my accrued benefits to a personal account?
    • Under the regulations, the trustee is restricted from imposing any fees or financial penalties for the transfer of accrued benefits from one registered scheme to another or from one account to another within the same scheme. (except in the case of expenses incurred as a result of funds redemption)

  5. How do I know if my accrued benefits have been properly transferred?
    • After receiving your transfer request, your new trustee will notify your previous trustee for the transfer of your accrued benefits. Your previous trustee is required to transfer your accrued benefits to the new trustee within 30 days after such notice. A transfer statement will be issued to you stating the particulars. The new trustee of your personal account will also send you a confirmation stating the amount received from your previous scheme.

  1. Who will decide which service provider to be used and which scheme to join - the employer or employee?
    • An employer will be the final decision-maker when choosing an MPF trustee or service provider. However, employees can nominate any MPF provider to preserve their MPF benefits upon termination of employment.

  2. Under MPF regulations, can an employee contribute more than the statutory amount of 5%?
    • Yes. An employee can contribute more than the statutory amount of MPF contributions. If the employee elects to do so, an employer must assist in deducting the agreed amount from the monthly salary and forwarding the contributions to the MPF trustee. However, the employer does not have any obligation to match the amount of an employee's voluntary contributions.

  3. Can MPF contributions be used to offset Long Service Payment or Severance Payment upon the employee's termination of employment?
    • Yes. An employer can use the accrued benefits in the MPF scheme that are attributable to the employer's contributions to offset any Long Service Payment (LSP) or Severance Payment.

      For example, if the accrued benefits are more than the LSP, the employer can withdraw an amount equal to the LSP to fulfill its obligations. However, if the accrued benefits are less than the LSP, the employer can withdraw an amount equal to the accrued benefits as partial payment, but must pay the LSP shortfall in order to fulfill obligations.

  4. If the probationary period of a company is three months, is the employer required to set up an MPF scheme after the employee has been employed for two months?
    • Yes. MPF regulations require an employer to enroll his employee into an MPF scheme upon completion of 60 days of employment. It has nothing to do with the probationary period.

  5. Can I make contributions more than 5% of the maximum monthly income (i.e. HK$30,000 per month) (with effect from 1 June 2014)?
    • Yes. Although there is a maximum relevant income level for calculating mandatory contribution, both employers and employees are allowed to make contribution in excess of the mandatory contribution as required by the MPF legislation. Such additional contribution will be treated as voluntary contribution. Having said that an employer is not obliged to match the voluntary contribution made by its employees. Also, please be advised that there are rules under the MPF scheme in which you participate governing the vesting and withdrawal of your accrued benefits that are attributable to voluntary contribution made by you or on your behalf by your employer.