EPF Contribution
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What are the responsibilities of an employer?
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As an employer, your responsibilities include paying EPF contributions in respect of any person you have engaged to work under a Contract of Service or Apprenticeship. You have to ensure accurate monthly contributions are deducted from your employees’ salary and remitted to EPF. Access to internet banking makes EPF contribution payments much easier now
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What Are The Elements You Need Know?
These are the three main elements which determine the obligation to contribute to EPF.
- Employer
- Employee, Contract of Service or Apprenticeship
- Wages
You need to register with the EPF if you fulfill the following elements.
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An Employer is defined as a person(s) with whom an employee has a contract of service or apprenticeship with.
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Manager, agent or person responsible for the payment of wages to an ’employee’.
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Group of persons whether statutory or non-statutory or incorporated.
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Government, government department, statutory body, local authority or other bodies as specified in the Second Schedule to the EPF Act 1991.
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An employee is defined as a person who is employed under a contract of service or apprenticeship. The contract of service or apprenticeship can be written or oral, expressed or implied.
“Contract of Service” is an agreement in which a person agrees to employ another person as an employee and the other person agrees to serve his employer as an employee.
“Contract of Apprentice” means a written contract made by a person with an employer who pledge to employ the person and train or cause him to be systematically trained for a work during a specified period of time approved by the employer who in the course of the exercise the apprentice is bound to working in the service of the employer.
(Apprenticeship definition reference – Employment Act 1955)
Minimum age: Employment age is subject to Children and Young Persons (Employment) Act 1966.
Maximum Age: 75 years
Persons Not Obligated To Contribute
Persons stipulated in the First Schedule of the EPF Act 1991 who are exempted from making a contribution are as follows:
- All nomadic aborigines unless in any particular case the Director-General of the Department of Aborigines otherwise recommends.
- Domestic servants as defined in section 3 of the Workmen’s Compensation Act 1952 [Act273], except when employed-
- by any employer specified in the Second Schedule to this Act;
- by any society registered or required to be registered under any written law for the time being in force relating to the registration of societies or co-operative societies;
- in any business registered or licensed or required to be registered or licensed under the Registration of Businesses Act 1956 [Act 197], the Trades Licensing Ordinance of Sabah [Sabah Cap. 144], the Businesses, Professions and Trades Licensing Ordinance of Sarawak [Sarawak Cap. 33] or the Businesses Names Ordinance of Sarawak [Sarawak Cap. 64], as the case may be; or
- by any corporation incorporated under any written law.
- Out-workers as defined in section 3 of the Workmen’s Compensation Act 1952, except when employed by any employer specified in the Second Schedule.
- Any person detained in any prison, Henry Gurney School, approved school, place of detention, mental hospital, rehabilitation centre having the same meaning in the Drug Dependants (Treatment and Rehabilitation) Act 1983 [Act 283] or leper settlement.Any person who is a Member of the Administration as defined under Article 160 of the Federal Constitution.
- Any person who is employed and whose country of domicile is outside Malaysia and who is in accordance with his terms and conditions of service participates in a provident fund or other similar scheme established or administered outside Malaysia.Any person who is employed and whose country of domicile is outside Malaysia and who has obtained prior written approval from the Board to participate in accordance with his terms and conditions of service in a provident fund or other scheme established or administered in Malaysia.
- Any person who has attained the age of seventy-five (75) years.
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Persons Obligated To Contribute
Except for the persons mentioned in the first Schedule of the EPF Act 1991, you are liable to pay EPF contributions in respect of any person whom you have engaged to work under a Contract of Service or Apprenticeship.
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Wages are all remuneration in money due to your employee under his contract of service or apprenticeship whether it was agreed to be paid monthly, weekly, daily or otherwise.
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Payment liable for contribution
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Payment not liable for contribution
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