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MPF in Hong Kong

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  1. #1

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    MPF in Hong Kong

    Dear All

    I'm from Australia and am in the process of interviews for a HK role.

    In Australia, employers are specific about whether the quoted salary is inclusive or exclusive of superannuation. I don't see the same for HK jobs. What is the norm here - is MPF paid on top of my salary or deducted from my salary?

    Also, if my salary is $50,000 per month. How does the MPF portion work. My employer pays $750 directly to my MPF and I also pay $750 to my MPF? Do I need to set up a monthly direct deposit to my MPF or does my employer pay my $750 share on my behalf directly from my monthly wage?

    Just trying to work what is the normal procedure for MPF in HK.

    Many thanks


  2. #2

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    It is not added to a salary package* and in that sense it treated like salary tax, in that the employer doesn't add an amount to cover tax.

    It's all automatic*. (At a salary of $50,00 pm) $1,500 is automatically deducted from your wages, and the employer contributes another $1,500. It all goes straight in your MPF account.

    Sometimes the Government increases the minimum amount. Again, this is taken care of automatically by the employer.




    * I'll add the caveat "usually" because someone will mention exceptions - guaranteed.

    Last edited by Claire ex-ax; 11-02-2016 at 04:08 PM.

  3. #3

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    One thing to note is that employers do not have to register their employees for the first 13 months (basically exempting anyone who is here for less than a year).

    Make sure however that your employer is not one of those as it would be denying you free money albeit costing you an extra 1500 per month for the first year, but it will come back to you anyway.


  4. #4

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    Thanks guys. So to clarify, on a $50k/month salary I expect a take home pay of $48,500 deposited into my bank account.

    Trebor - I have read about the 13 month rule. Does the law require some sort of contractual stipulation that you will only be working in HK for less than 13 months? Or is it that employers take advantage of this 13 month rule knowing full well that you are on a longer term contract?


  5. #5

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    So to clarify, on a $50k/month salary I expect a take home pay of $48,500 deposited into my bank account.
    Yes. It's up to you to sort out your tax from your 'take home'. The mandatory MPF contribution is tax deductible; any voluntary contributions are not. There's no official PAYE; instead you will receive an annual tax bill to be settled in two payments in the following year.
    Last edited by Claire ex-ax; 11-02-2016 at 04:26 PM.

  6. #6

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    Quote Originally Posted by Claire ex-ax:
    Yes. It's up to you to sort out your tax from your 'take home'. The mandatory MPF contribution is tax deductible; any voluntary contributions are not. There's no official PAYE; instead you will receive an annual tax bill to be settled in two payments in the following year.
    Thank you. Very clear.

  7. #7

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    Sorry, just one more question on MPF. I read that it's up to employers to enroll you in an MPF scheme. Does that mean I'm restricted to my employer's choice of fund i.e. I can't you use a fund provider of my own choice and ask my employer to deposit funds into that scheme?


  8. #8

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    Quote Originally Posted by dariah:
    Sorry, just one more question on MPF. I read that it's up to employers to enroll you in an MPF scheme. Does that mean I'm restricted to my employer's choice of fund i.e. I can't you use a fund provider of my own choice and ask my employer to deposit funds into that scheme?
    We wish!

    Three years ago, the government changed the law to allow employers to choose to transfer the accrued benefits in their contributions account (the one with the employer) to another scheme of their own choice. This can only be done once a year.

    The government still hasn't had to balls to give employees total freedom on this.
    Last edited by Claire ex-ax; 11-02-2016 at 04:46 PM.
    shri and Lord Dashwood like this.

  9. #9

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    Quote Originally Posted by Claire ex-ax:
    We wish!

    Three years ago, the government changed the law to allow employers to choose to transfer the accrued benefits in their contributions account (the one with the employer) to another scheme of their own choice. This can only be done once a year.

    The government still hasn't had to balls to give employees total freedom on this.
    Thanks Claire

  10. #10

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    Quote Originally Posted by dariah:
    Thanks guys. So to clarify, on a $50k/month salary I expect a take home pay of $48,500 deposited into my bank account.

    Trebor - I have read about the 13 month rule. Does the law require some sort of contractual stipulation that you will only be working in HK for less than 13 months? Or is it that employers take advantage of this 13 month rule knowing full well that you are on a longer term contract?
    My understanding is that the first 13 months is non-compulsory and that some companies take advantage of this.

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