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Starting October: Foreign Employees Must Contribute to EPF
The Malaysian government has announced a major change: starting from October 2025, all foreign employees with valid work permits (except domestic helpers) are required to contribute to the Employees Provident Fund (EPF). Here’s quick breakdown of what you need to know.
Who Does This Apply To?
- Effective Date: Contributions start from salaries paid in October 2025. Employers must make contributions by the 15th of the following month.
- Covered Employees: All non-Malaysian citizens with valid work permits, including Employment Pass holders, Professional Visit Pass holders, Student Pass holders, Resident Pass holders, Long-Term Social Visit Pass holders, etc.
- Exemptions: Domestic helpers (e.g., maids, cleaners, drivers) are not included, though they may contribute voluntarily.
Contribution Rate
- Both employers and foreign employees are required to contribute 2% of the employee’s monthly wages each.
Registration Process
- Employers must register their foreign employees with EPF.
- EPF is introducing automated registration and status notification features to make the process easier for businesses.
When Can Employers Stop Contributing?
- Contributions can stop during the final two months before the expiry of the employee’s work permit.
What Benefits Do Foreign Employees Receive?
- Once contributing, foreign employees enjoy EPF benefits, such as:
▫ Annual dividends
▫ Flexible withdrawals (e.g., for housing, medical, education, or portal withdrawals at 55-66 years old)
▫ Lump-sum withdrawals if their EPF balance exceeds RM1 million
▫ Other EPF-approved withdrawal schemes
FAQ
Q1: When does this new rule take effect?
From October 2025 salary onwards. Employers must contribute by the 15th of the following month.
Q2: Are domestic helpers included?
No. Domestic helpers such as maids, cleaners and drivers are excluded. However, they may voluntarily contribute.
Q3: How much is the contribution rate?
Both employer and foreign employee must contribute 2% monthly wages each.
Q4: How should employers register foreign employees for EPF?
Employers must register through the EPF system. EPF is working on automating registration and providing status notification to reduce manual paperworks.
Q5: When can EPF contributions stop for foreign workers?
Contributions may stop during the last two months before the employee’s work permit expires.
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