1. Learn how to set up an MPF account?
Organising an MPF account is an easy process. Hong Kong’s Mandatory Provident Fund Schemes Creatority («MPFA») maintains a list of MPF Approved Trustees which employers could consider. As an illustration, the HSBC MPF plan provides individuals with a wide number of funding schemes equivalent to those centered more on world bonds, Hong Kong and Chinese equities and so on. Merely contact your chosen MPF providers and complete the relevant employer application varieties for the scheme of your choice. Once an employer has successfully enrolled in an MPF scheme, they will be issued an employer’s identification number, demonstrating your obligation to help your employees in their retirement schemes.
2. What are an employers’ obligations under the Hong Kong MPF regulations?
Employers must also complete the one-time obligation of assisting their workers in opening MPF accounts. Aside from exempt persons, an employer should enroll each full-time and part-time staff who’re no less than 18 but under sixty five years of age in an MPF scheme within the first 60 days of their employment. Nonetheless, if an employment relationship ends previous to the 60th day of employment, no MPF arrangement is required.
Upon profitable enrollment, employers should meet ongoing obligations of remitting contributions to their employees MPF schemes once every contribution period. Contributions for monthly-paid full-time employees are typically made on the tenth day of every month.
Employers and staff are every required to make common mandatory contributions to an workers MPF scheme. The MPF worker contribution and MPF employer contribution should each be 5% of the employee’s relevant revenue, topic to relevant revenue levels. For a month-to-month-paid employee, the minimal and maximum relevant earnings ranges are $7,one hundred and $30,000 respectively.
To make payments to their employees, employers are required to calculate their worker’s related income and the quantity of mandatory contribution that have to be made for each contribution period. The employer should then deduct the calculated amount from their worker’s income and remit that sum to their MPF account.
3. What are the employee contribution guidelines under the Hong Kong MPF regulations?
Staff do not face as many compliance obligations as their employers do. Nevertheless, it is vital for employees to make sure that they make the common necessary contribution of 5% of their related income to their relevant scheme as mentioned above.
4. Are there exemptions under a Hong Kong MPF contribution guidelines?
Not all workers working in Hong Kong should be enrolled under an MPF scheme. Expatriates residing in Hong Kong for employment functions can obtain permission to be exempted by the Hong Kong Government. Permission can only be granted if the worker in query is either a member of an abroad retirement scheme, or will reside in Hong Kong for a period of thirteen months or less.
In the occasion an employer fails to adhere to their MPF obligations, the MPFA will concern the employer with a «surcharge discover». This discover will impose a 5% surcharge on default contributions and the surcharge acquired will go solely to the employee’s MPF account. In addition, defaulting on contributions is a criminal offence and the defaulter is liable to a maximum penalty of a HK$450,000 fine and imprisonment for 4 years. Employers who have did not comply with their MPF employer obligations are liable to potential financial penalties of HK$5,000, or 10% of the default amount, whichever is greater, on the defaulting employer.
We understand that matters referring to MPF calculation and payroll administration are time-consuming tasks that require a significant amount of the corporate’s resources. FastLane can manage these essential enterprise tasks, reminiscent of payroll, MPF account setup and your employee’s enrollment into your chosen MPF scheme in your behalf.
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