If you are looking to hire employees to work for your business in Hong Kong, it is important to understand the MPF system. The MPF System makes it compulsory for 5% of an employees salary (there is an exemption if the employees salary is below $7100) to be saved for retirement. The employer will also match this 5% amount.
Employees will be able to withdraw their MPF savings when they reach 65 years old or when they renounce their working visa.
As an employer, you will have the responsibility to pick a MPF provider to work with. Employers are allowed to pick more than one scheme. When choosing a scheme, the things to compare include and consider include the types of funds available under the scheme, the fees, and the customer service each MPF provider can offer.
It is also the responsibility of the employer to enroll new employees within 60 days of employment. Similarly, it is the responsibility of the employer to inform the MPF provider 10 days after the last day of the calendar month if an employee terminates their employment with you.
It should be noted that under the Inland Revenue Ordinance in Hong Kong, contributions to MPF is deductible when calculating assessable income when filing tax.
For additional information or if you need help with choosing a MPF provider, please contact us.
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