Relevant income for Hong Kong MPF contributions

Relevant Income Hong Kong

Relevant income is the statutory basis for calculating Mandatory Provident Fund (MPF) contributions under the Mandatory Provident Fund Schemes Ordinance. It determines the amount of wages, salary and other cash payments on which both employer and employee must contribute.

MPF Relevant Income

The definition of MPF relevant income covers all cash payments an employer pays an employee in connection with their employment. This includes salary, wages, commissions, bonuses, allowances, tips and any other cash remuneration. The Mandatory Provident Fund Schemes Authority (MPFA) administers this definition.

Hong Kong MPF Income Definition

Hong Kong's MPF income definition excludes certain payments. Non-cash benefits such as accommodation, share options and meals are not relevant income. Severance payments, long service payments and payments in lieu of notice are also excluded. When processing payroll, the employer must identify which payments fall within the definition.

MPF Contribution Income

MPF contribution income is subject to minimum and maximum monthly thresholds. Where monthly relevant income is below HK$7,100, the employee does not contribute but the employer still contributes 5%. Where monthly relevant income exceeds HK$30,000, contributions are capped at that level. The maximum mandatory contribution from each side is HK$1,500 per month.

Relevant Income for MPF

The relevant income for MPF calculation applies the 5% contribution rate. The employer contributes 5% of the employee's relevant income, and the employee contributes a matching 5%. The employer deducts the employee's share from wages and pays both amounts to the MPF scheme trustee.