EPF Contribution Calculation

Modified on Mon, 20 Mar 2023 at 06:22 PM

The system calculates EPF contribution based on the EPF Base.

Being said that, the EPF contribution was followed by the KWSP Jadual Ketiga referring to the EPF Base stated in the payslip.

What is EPF Base?

This EPF Base accumulates from your earning payroll item that has been flagged for EPF as below.

Navigate to the below article to learn more on Payroll Items :

How to view EPF Base in Payroll Review?

Navigate to Payroll > Payroll Review > Individual Payroll to select an employee name and scroll down to view the statutory base.

EPF Contribution Calculation Example:

Mr. Ali's employer contribution is 13% and his employee contribution is 11%.

His salary is RM5000 and his Travel Allowance is RM 1900.

His EPF Base is RM 5000 due to he does not flag Travel Allowance as an EPF base in the payroll item setting.

Calculation Breakdown:

Ali EPF Base = RM 5000

Employer contribution = 13%

Employee contribution = 11%

Thus, Ali EPF deduction based on KWSP Jadual Ketiga:

Employer contribution = RM 650

Employee Contribution = RM 550

Kindly refer to this link for further information about KWSP Jadual Ketiga :

https://www.kwsp.gov.my/documents/20126/140690/Jadual+Ketiga+BI.pdf

Side Note: The General Rule of Thumb for Employer (ER) Contribution

1. If the salary is equal and less than 5k, the contribution is 13%

2. if the salary is more than 5k, the contribution is 12%

3. If the salary ( less than 5k) is paid with a bonus which makes the total sum more than 5k, the contribution is 13%

4. If the allowance is more than 5k, the contribution is 12%

5. If the allowance is paid with a bonus which makes the total sum more than 5k, the contribution is 13%

6. If a Bonus ( more than 5k) is paid without salary, the contribution is 13%