MPF (Mandatory Provident Fund)
is Hong Kong’s mandatory pension scheme: employer and employee each contribute 5% of relevant income, capped at HKD 1,500 monthly per side, into privately managed MPF funds. Coverage starts after 60 days of employment; limited expatriate exemptions exist for short stays and home-scheme membership.
MPF essentials for employers
Enrolment within the first 60 days, contributions from day one’s income thereafter (with an initial employee-side holiday mechanics), remittance by the 10th of each month. The long-criticised severance offsetting — using employer MPF to fund severance — was abolished from May 2025, raising effective exit costs; transition rules apply around the cutover date.
Expat exemptions cover persons in Hong Kong under 13 months or covered by comparable overseas schemes — documented, not assumed. Official guidance: mpfa.org.hk.
FAQ
What income counts for MPF?
‘Relevant income’ — wages, leave pay, commissions, most allowances — within the floor and cap: employees earning under the monthly floor skip their 5% while employers still pay theirs; both sides cap at HKD 1,500. Bonuses count in the month paid.
How does the offsetting abolition change costs?
Since May 2025 employers can no longer offset severance and long-service payments against their MPF contributions for post-abolition service — exits cost more, and provisioning practices are adjusting. Pre-abolition service retains old treatment, so long-tenure exits compute in two layers.