Information Centre

Under the law, employers must make Mandatory Provident Fund (MPF) contributions for employees on time. Failing to comply may constitute a criminal offence. In the 2016-17 financial year, there were 293 convicted cases for contributions in arrears.

The Mandatory Provident Fund Schemes Authority has found that some employers breach the law because they do not have a good understanding of the requirements when making MPF contributions. Some think that they are making their contributions on time if they post a cheque to their trustee on the contribution day. In fact, the trustees must receive the contributions and remittance statement by the contribution date. The postmark date on the envelope is not considered to be the date on which the employer made the contributions. Employers should therefore allow sufficient postal delivery time and affix sufficient postage to ensure the contributions and remittance statement successfully reach the trustee on or before the contribution day.

Another misconception is that employers think that as long as they have arranged for autopay and their bank account has enough money for the employer’s and employee’s part of contributions, their duty is complete. However, many forget to send the completed remittance statement to the trustee by the contribution day. If an employer does not submit a remittance statement or fills in inaccurate information, the trustee will be unable to process the payment by autopay. As a result, the employer will be considered to have defaulted on its contributions.

The third misconception is that some employers believe that they have to use a pre-printed remittance statement from the trustee and therefore that the trustee is responsible for the delay if the remittance statement is not received. In fact, pre-printed remittance statements are a service provided by some trustees, not their legal obligation. If a trustee does not provide one, the employer must fill in a remittance statement on its own. Normally, a template of the remittance statement can be downloaded from the trustee’s website.

Be a smart employer and take note of the following:

• Use the online system or software provided by your trustee to make contributions and submit your remittance statement;
• Regardless of the contribution method, your contributions and completed remittance statements should reach your trustee on or before the contribution day;
• After making MPF contributions, you must provide a pay-record to each employee within seven working days.