The latest contribution rate for employees and employers effective January 2019 'salary/wage' can be referred in the Third Schedule, EPF Act 1991. Employers are required to remit EPF contributions based on this schedule.

For late contribution payments, employers are required to remit contributions in accordance with the third schedule as attached below by referring to the applicable effective date. Please click on the hyperlinks below for employee and employer contribution rates:

• Effective from 1 January 2021 to December 2021 (January 2021 salary/wage up to December 2021)
• Effective from 1 April 2020 to December 2020 (April 2020 salary/wage up to December 2020)

An employer’s contribution is either 4%, 6%, 6.5%, 12%, 13% of the total monthly income of the employee or RM5.00 (for Non-Malaysians from 1 Aug 1998), depending on the employee’s age and monthly salary rate. In addition to status and age, there are differences in EPF calculations if an employees' salary exceeds RM20,000.00. 

If an employee earns under RM20,000.00 per month, the EPF calculation is based on the gross earnings bracket it falls under. The table below shows the EPF calculations applicable to employees earning less than RM20,000.00 per month based on status, monthly salary and age:

If an employee earns over RM20,000.00 per month, employers can calculate both the employer and employee EPF contribution based on the exact percentage. The total contribution (which includes cents) is rounded to the next ringgit. Depending on the employee’s age and salary rate of RM20,000.00 or over, the employee contribution is either 0%, 5.5% or 11% of the total monthly earnings which are deducted from the employees salary/wage.

Employers must make mandatory monthly payments, however, there are a few scenarios in which employees may elect to have voluntary contributions. These include:

• Domestic helpers and foreign citizens: These employees are exempted from contributing, however, they are still allowed to elect to make a contribution. When such an employee has opted to make a contribution, both employee and employer shall be liable to contribute and the option may not be revoked.
• Voluntary excess: The employer or the employee, or both, may choose to contribute more than the stipulated rates under the Third Schedule to the EPF Act 1991. In this scenario, the last rate that the employee opts for will be the new contribution rate and will remain as so until the employee and/or employer submits a cancellation notice. Upon receipt of the notification, the rate of contribution will be reverted to the current statutory rate.

Within the pay run grid, the following column relates to EPF contributions:

Both employee and employer contributions are included in this and are influenced by the following factors:

• The ‘Residence Status’ field within the Employee file > Statutory settings page (EPF is mandatory for Malaysians and permanent residents);
• EPF is not applicable for income earned against a pay category where the ‘EPF Exempt’ option is selected;
• Both the mandatory and voluntary contributions (added via the adjust EPF option within this pay run OR pay run inclusions) are displayed in this value.

Once complete, the net earning calculation is: Gross Earnings - Pre Tax Deductions - Employee EPF - Employee EIS - Employee SOCSO - PCB - Post Tax Deductions.

Once the pay run is finalised, you are able to download an EPF csv payment file which includes the contribution details that can be uploaded to your EPF portal. NB This will not make an actual payment for these contributions, instead, that needs to be done manually by the employer. 

On the pay slip, the employee contribution is listed as a deduction from an employees' gross pay, however, the employer contribution is not deducted from the employee’s salary as it is the responsibility of the employer.

The below provides information on how EPF is reported in the following reports. This will assist in managing employee and employer EPF contributions:

Costing report

Contains the following:

• ‘Mandatory Employer EPF’ column
• ‘Additional Employer EPF’ column
  
  
  

Detailed activity report

Contains the following:

• Calculation for Employer EPF = Mandatory Employer EPF + Additional Employer EPF
• Calculation for Employee EPF = Mandatory Employee EPF + Additional Employee EPF
• Calculation for ‘Gross + EPF’ = Gross earnings for employee + Employer EPF for employee
  

Gross to net

Contains the following:

• ‘EPF Contributions’ which displays the following columns:
  • Employer (sum of mandatory and additional contributions);
  • Employee (sum of mandatory and additional contributions);
  • ‘Total Gross plus EPF’ = ‘Gross Earnings’ for employee + ‘Employer EPF Contributions’ for employee
    

Ordinary time earnings report

Contains the following:

•  Employer EPF column
•  Employee EPF column
  

Pay categories report

Contains the following:

• •  Employer EPF column
  •  Employee EPF column
    

Pay run audit report

Contains the following:

• EPF Contributions display the following columns:
• Mandatory Employer
• Mandatory Employee
• Additional Employer
• Additional Employee
• EPF Contributions
• Employer EPF
• Employee EPF

Pay Run Variance Report

Contains the following:

• Calculation for ‘Gross plus EPF’ = ‘Total Gross Earnings’ for employee + Total value of mandatory EPF, SOCSO and EIS for both employer and employee
  

Pay Slip Report

Contains the following:

• EPF’ value = sum of all EPF contributions included in pay run for employee. EPF Breakdown’ includes ‘Mandatory Employer EPF’, ‘Mandatory Employee EPF’, ‘Additional Employer EPF’ and ‘Additional Employee EPF’ for pay run for employee
  

EPF contribution report

Contains the following:

• ‘Contribution Type’ filter options:
  • Mandatory Employer EPF
  • Mandatory Employee EPF
  • Additional Employer EPF
  • Additional Employee EPF
    

Timesheets report

Contains the following:

• Mandatory Employer EPF
• Mandatory Employee EPF
  

CP22A/CP22B report

Contains the following:

• Employer EPF for basis period

E Form (CP8D) report

Contains the following:

• Employee EPF for basis period

KWSP6 (Form A) report

Contains the following:

• Report contains the following columns:
• EPF Member Number
• Employer EPF
• Employee EPF

Payroll summary report

Contains the following:

• Employer EPF
• Employee EPF
• Total EPF for pay run

CP8A (Employee Year End Tax Filing)

Contains the following:

• EPF deductions