Who is exempt from MPF contributions in Hong Kong

Who Is Exempt From MPF Contributions in Hong Kong

Hong Kong's Mandatory Provident Fund (MPF) system is the statutory retirement savings framework, but not every worker must be enrolled. Certain categories of employees and workers are explicitly exempt from MPF contributions under the Mandatory Provident Fund Schemes Ordinance (Cap. 485). The main groups are identified below, along with the partial exemption where an employee pays nothing but the employer still contributes.

MPF Exemption Categories

The MPFA divides exempt persons into several categories. Each has its own statutory basis, but the common factor is that the person is either outside the definition of "employee" for MPF purposes or is covered by an alternative retirement scheme.

Who Does Not Pay MPF

Employees under a continuous contract but aged under 18 or over 65 are not required to make mandatory contributions. An employee under 18 has no MPF obligation. An employee aged 65 or older also has no mandatory contribution obligation, although an employer may choose to make voluntary contributions. In both cases, the employer is not required to contribute either.

Casual employees not employed under a continuous contract are not covered by the MPF system. The Employment Ordinance defines a continuous contract as four weeks or more with at least 18 hours worked each week. If a worker does not meet that threshold, neither party has an MPF obligation.

MPF Exemption for Domestic Workers

Domestic helpers employed in private households are specifically exempt. This applies to foreign domestic helpers (FDHs) under standard employment contracts and to local domestic workers. The employer of a domestic helper has no statutory MPF enrolment obligation and neither party makes contributions.

The exemption for domestic workers is set out in the MPF legislation and is not affected by the number of hours worked or the duration of employment. An employer who wishes to provide retirement benefits for a domestic helper may do so voluntarily, but there is no legal requirement.

MPF Exemption Self-Employed Persons

A self-employed person is defined in the MPF legislation as a person who earns income from a trade, profession or business where the person is not an employee. Self-employed persons are generally required to make contributions based on their relevant income, but with important exceptions.

Self-employed persons with relevant income below HK$7,100 per month are exempt from making mandatory contributions. The threshold operates the same way as for employees: if the self-employed person's relevant income is less than HK$7,100 per month, no contribution is required. If the income exceeds HK$30,000 per month, the maximum mandatory contribution is capped at HK$1,500 per month.

A self-employed person who has no relevant income is also exempt from making contributions, meaning a person whose business makes no profit or has ceased trading is not required to make MPF payments.

Employees with Relevant Income Below HK$7,100 Per Month

This is a partial exemption. An employee whose relevant income is below HK$7,100 per month is not required to make the employee's 5% contribution, but the employer must still contribute the full 5% on that income. The same rule applies where the employee's relevant income is zero in a given month, for example during unpaid leave.

Employers should note that this is not an exemption from the employer's obligation. The employer must contribute even where the employee's pay is below the threshold. The MPFA treats failure to contribute in this situation as a breach of the MPF legislation.

Members of ORSO Schemes

An employee who is already a member of an Occupational Retirement Schemes Ordinance (ORSO) scheme that has been granted an exemption certificate by the MPFA is exempt from joining an MPF scheme. ORSO schemes are occupational retirement schemes that existed before the MPF system was introduced or were established as exempt schemes.

The exemption applies only where the ORSO scheme meets the statutory conditions and the MPFA has issued the certificate. An employer cannot simply opt out of MPF by setting up an ORSO scheme without the exemption.

Exempt Persons Under Industry-Based Schemes

The construction and catering industries have industry-based MPF schemes. Employers in these industries must enrol employees in the industry-specific scheme rather than in a standard MPF scheme. An employee who is covered by an industry-based scheme is exempt from joining a standard MPF scheme, but the contribution requirements are the same.

The MPFA publishes a list of approved industry-based schemes and their coverage. Employers in these industries should confirm they are using the correct scheme for each category of worker.

What to Do Next

If you are an employer, review each worker's status against the categories above. Workers who fall outside the MPF exemption categories must be enrolled in an MPF scheme within 60 days of employment starting. The MPFA's website provides guidance notes and a contribution calculator. If you are unsure whether a category applies, seek professional advice from a licensed MPF intermediary or your corporate service provider.