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As per the announcement by the Malaysian Prime Minister on 28-January-2016, during the revision on Budget 2016, the Employee Provident Fund Board (EPF) has announced the reduction in employee’s monthly statutory contribution rate.

With effect from 1st March 2016 (contribution to be made by 15-April-2016), the following contribution rates shall automatically be applicable (reduction should only be reflected from March’s payroll):

  1. For employees below 60 years of age – 11% to 8%
    (3% reduction for employee’s portion)
  2. For employees above 60 years of age – 5.5% to 4%
    (1.5% reduction for employee’s portion)
  3. No change to the employer’ portion of 12% or 13%

The reduced rates shall be in force until December 2017. Thereafter, the reductions will cease to exist and the normal rates shall be reapplied.

For employers who have employees who would like to retain their current contribution rates notwithstanding the announcement, they must complete and submit the Form KWSP17A Khas 2016 to the nearest EPF branch before 1st March 2016. Without submitting the said Form, the rates must be reduced accordingly.

The form can be downloaded as per the link below:

Note that the new monthly contribution rate (Schedule Three) will only be available on EPF website from 16 February 2016 onwards.

Do contact us ( should you require further information.