The Employees Provident Fund (EPF), also known as KWSP, is Malaysia's mandatory retirement savings scheme. It helps employees build long-term savings throughout their working life so they have financial support after retirement.
EPF is one of the most important statutory deductions in Malaysia. Both employees and employers contribute a percentage of monthly salary into the employee's EPF account.
Every month, an employee contributes part of their salary to EPF while the employer contributes an additional amount. These contributions are credited into the employee's EPF account and continue to grow over time.
The savings may also earn annual dividends declared by EPF, helping members grow their retirement funds.
For most employees below the age of 60, the employee contribution rate is generally 11% of monthly wages.
Employer contribution rates depend on salary levels and employee age. For many employees, employers contribute either 12% or 13% of monthly wages.
Employee contributions are deducted directly from monthly salary.
Employer contributions are paid separately by the employer and do not reduce the employee's take-home pay.
Both contributions are credited into the same EPF account and form part of the employee's retirement savings.
EPF savings are primarily intended for retirement. However, members may be allowed to withdraw funds for specific purposes such as:
EPF encourages disciplined long-term savings and helps Malaysians prepare for retirement. Regular monthly contributions combined with dividend earnings can accumulate into a significant retirement fund over time.
Yes. EPF contributions are generally mandatory for eligible employees and employers in Malaysia.
Most employees contribute 11% of monthly wages, subject to current EPF regulations.
Yes. Employer contributions are credited into the employee's EPF account and belong to the employee.
Certain withdrawals are allowed for approved purposes, subject to EPF rules and conditions.
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