As announced by the Malaysian Government the statutory contribution rate for employee contributions will go down from 11% to 7%, starting from April 2020 to December 2020. The new rate is in line with the Government's announcement on the 2020 Economic Stimulus Package 2020 on Feb 27. Employer’s contribution rate remains no change.
The new statutory contribution rate for employees applies to those below 60 years old who are liable for contribution. However, the statutory contribution rate for employees aged 60 years old and above remains unchanged.
What should I do on this change?
As an employer, you have two options:
Option 1 - Employee who choose to follow the new minimum contribution rate of 7%
- Swingvy will adjust the employee default contribution rate to 7% from Apr 2020 to Dec 2020 payroll.
- Just process the payroll as usual.
Option 2 - Employee who choose to maintain the current employee contribution rate of 11%
- For those employees wish to remain their contribution at 11%, HR will fill up the employee information in Form 17a khas and submit to KWSP.
- Download the form NOTIS PILIHAN MENCARUM MELEBIHI KADAR BERKANUN (SYER PEKERJA)
- Fill up the form
- Email to VE2020@epf.gov.my
- Here is the instruction from Employees Provident Fund (EPF):
- Then, update your employee additional EPF %
(a) by individual update
- Select Payroll > Go to payroll employee profile
- Update 4% on employee EPF additional rate
(b) by bulk update
- Go to Payroll (Home ) > Click Employees info (Bulk update) > Download payroll bulk upload template
- Update 4% under additional employee EPF rate column for employees who choose to maintain the contribution rate of 11%
- Upload to Swingvy