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[UPDATED] EPF 7% contribution rate starts in April 2020, here’s how to keep it at 11%

[ UPDATE 07/03/2020 00:05 ] The KWSP 17A (Khas 2020) form is now available. Download it here.

[ UPDATE 06/03/2020 09:45 ] For the upcoming EPF rate reduction, a different form (KWSP 17A (Khas 2020) is required to increase your contribution rate.


As announced by the former Interim Prime Minister, the Employees Provident Fund (EPF) contribute rate will be reduced from 11% to 7% as part of the initiative under the Economic Stimulus Package 2020. This is boost spending to mitigate the economic impact of the COVID-19 outbreak.

The 7% contribution rate will take effect from 1st April 2020 until the end of 2020 and it will be applicable to all EPF members under 60 years of age that are subject to statutory contribution. For members aged 60 years and above, the employees’ share of contribution rate will remain at 0%.

With a lower contribution rate, Malaysians will get slightly more money from their monthly salary. The temporary 4% EPF rate reduction is expected to unlock approximately RM10 billion worth of spending by Malaysians during the 9 months period.

However, there are concerns that the reduced rate will have a long term impact on retirement savings, especially for low-income workers. It is worth pointing out that the employer contribution rate remains unchanged at 12% for salaries above RM5,000 and 13% for salaries of RM5,000 and below. If you’re earning less than RM5,000, the total contribution is 20% (7% by employee + 13% by employer).

Maintaining 11% contribution rate

If you don’t need the extra cash and prefer to put the 4% back into your EPF account, you may do so by filling up a form. All you’ll need is to submit Form KWSP 17A (AHL) through your employer to declare that you are contributing more than the statutory rate.

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[ UPDATE 06/03/2020 09:45 ] For the upcoming EPF rate reduction, you’ll need to submit form KWSP 17A (Khas 2020) instead of KWSP 17A (AHL).

With Form KWSP 17A (AHL) the new rate will be permanent until you submit a notice of cancellation through Form KWSP 18A(AHL).

[ UPDATE 07/03/2020 00:05 ] The KWSP 17A (Khas 2020) form is now available. Download here.

After filling up the form, it must be submitted to your employer. After verification, employers will have to submit the completed form to the nearest EPF branch for submission.

The reduction of EPF’s employee’s contribution rate is not new. The previous reduction was in 2016 where the rate was reduced from 11% to 8% from March 2016 to December 2017.


Alexander Wong