Employees Provident Fund (EPF) reduced to 7 percent
With reference to the Malaysian Government’s announcement on the 2020 Economic Stimulus Package with regards to the new statutory contribution rate for employees, the Employees Provident Fund (EPF) will be reduced from 11 percent to 7 percent from April 2020 onwards.
Additional clarifications with regards to this reduction are as follows:
1. The new statutory contribution rate for employees will take effect from April 2020’s wage (May 2020’s contribution) up to December 2020’s wage (January 2021’s contribution) subject to the Third Schedule of the EPF Act 1991.
2. The new statutory contribution rate for employees applies to those below 60 years old who are liable for contribution. The statutory contribution rate for employees aged 60 years old and above, however, remains unchanged.
What’s going to happen on AYP HR Solutions end:
With regard to the above statutory law, we, AYP HR Solutions will be implementing this EPF change to your monthly payroll processing at 7 percent starting from April 2020 onwards.
However, if you would still like to maintain the employee contribution rate at 11 percent, kindly complete the Borang KWSP 17A (Khas 2020) form which will be made available on http://kwsp.gov.