MPF Contribution Rules
The MPF is Hong Kong’s mandatory retirement protection scheme. It requires both employers and employees to contribute 5% of the employee’s relevant income. Relevant income is subject to minimum and maximum thresholds. The current minimum level of relevant income is HK$7,100 per month, and the maximum level is HK$30,000 per month. If an employee earns less than HK$7,100 per month, the employee is not required to contribute, but the employer must still contribute 5% of the employee’s income. If an employee earns more than HK$30,000 per month, both the employer and the employee need only contribute 5% on the first HK$30,000 of income, meaning the maximum monthly contribution for each is HK$1,500.
MPF Withdrawal Conditions
Accumulated MPF benefits must be preserved until a scheme member reaches the retirement age of 65 before they may be withdrawn. In the following specific circumstances, a member may withdraw accrued benefits early, before the age of 65:
- Reaching the age of 60 and having terminated all employment and self-employment, and making a statutory declaration that one will no longer work or be self-employed.
- Permanently leaving Hong Kong, and making a statutory declaration stating no intention to return to Hong Kong to work or settle.
- Total loss of capacity, certified by a registered medical practitioner.
- Suffering from a terminal illness, with life expectancy reduced to 12 months or less, certified by a registered medical practitioner.
- A small balance account (account balance not exceeding HK$5,000), with no contributions made to any MPF scheme in the past 12 months, and a declaration of no intention to work or be self-employed again.
- Death (withdrawn by the estate representative).
Coordination Arrangements Between the MPF and Mainland Social Security During Cross-Border Employment
When Hong Kong residents take up employment in the mainland, they may face the dual contribution issue of both the MPF and mainland social security at the same time. To address this, Hong Kong and the mainland have signed the Arrangement for the Avoidance of Double Taxation, and have reached specific exemption arrangements regarding social security. Under the current mechanism, if a Hong Kong resident is employed by a mainland enterprise and participates in the basic pension insurance and unemployment insurance in the mainland, they may, by providing proof of their MPF scheme membership, apply to the mainland social security authority for exemption from the individual contribution portion of the basic pension insurance and unemployment insurance, but must continue to pay medical, work injury and maternity insurance. The exemption period is generally calculated from the date the exemption certificate is first obtained, and does not exceed five years at most, though it may be extended upon application depending on the circumstances. If the Hong Kong employee returns to work in Hong Kong, they must rejoin the MPF scheme and cease the social security exemption arrangement in the mainland.
Please note that exemption from individual contributions does not affect the recognition of contribution years accrued in the mainland; mainland social security institutions will still record the employer’s contribution portion into the personal account. For individuals who have made contributions in both places, their post-retirement benefits must be calculated separately in accordance with the respective rules of each place, and there is currently no mechanism for direct consolidation or transfer.