Malaysia Statutory social-insurance contributions

What this value means

WHAT A PAYROLL ENGINE GETS WRONG IN MALAYSIA. 1. ALL THREE MAIN SCHEMES ARE STATUTORY TABLES OF CASH AMOUNTS, NOT PERCENTAGE FORMULAE, AND THE TWO DISAGREE. EPF's Third Schedule prescribes an exact ringgit figure for each RM20 wage band up to RM20,000 a month. SOCSO's Third Schedule and EIS's Second Schedule do the same by wage bracket up to the RM6,000 ceiling. The percentages in this record are DESCRIPTIVE of those tables, not the operative rule. The divergence is visible at the ceiling: 1.75% of RM6,000 is RM105.00 but SOCSO's table says RM104.65; 0.5% is RM30.00 but the table says RM29.90; 0.2% is RM12.00 but EIS says RM11.90. An engine that multiplies out the percentages will disagree with PERKESO's and EPF's own figures in most brackets. Use the schedules. 2. THE EPF EMPLOYER RATE STEPS DOWN AT RM5,000 AND THE TOTAL COST FALLS AS PAY RISES ACROSS IT. Employer 13% at or below RM5,000, 12% above; employee 11% throughout. Total contributions on RM5,000 are RM1,200 and on RM5,020 are RM1,154.60. This is the opposite of every other threshold in this dataset and is regularly modelled backwards. 3. EPF HAS NO CEILING; SOCSO AND EIS BOTH CAP AT RM6,000. EPF runs on the whole salary at every level. Reusing the RM6,000 cap for EPF under-contributes catastrophically for senior staff. And RM5,000 appears in both schemes with completely different meanings — an EPF rate-step with no cap above it, and SOCSO's FORMER hard ceiling. 4. THE SOCSO AND EIS CEILING ROSE TO RM6,000 ON 1 OCTOBER 2024 AND THE OLD RM5,000 IS STILL EVERYWHERE. Any table showing a SOCSO maximum of RM86.65 employer / RM24.75 employee, or an EIS maximum of RM9.90, is on the pre-October-2024 RM5,000 ceiling. The current maxima are RM104.65 / RM29.90 and RM11.90. 5. EPF BECAME MANDATORY FOR FOREIGN WORKERS ON 1 OCTOBER 2025, AT A DIFFERENT RATE. 2% employee and 2% employer for non-citizens — not the 11%/13% citizen rate, and no longer the token RM5 flat employer contribution that applied when foreign-worker EPF was voluntary. This is the single newest obligation in Malaysian payroll and is absent from every pre-2026 reference. 6. THE THREE SCHEMES TREAT FOREIGN WORKERS THREE DIFFERENT WAYS ON THE SAME PAYSLIP. EPF: in, at 2%/2% since 1 October 2025. SOCSO: in, for Employment Injury. EIS: OUT entirely, no employee or employer contribution. HRD Corp levy: OUT — the levy base is Malaysian employees only. A single "is foreign worker" flag cannot drive all four lines. 7. THREE SCHEMES CHANGE AT AGE 60 AND ALL THREE CHANGE DIFFERENTLY. EPF: employee rate falls to 0%, employer continues at 4%. SOCSO: moves to Second Category, employer-only 1.25%, Employment Injury cover only, Invalidity cover lost. EIS: contributions cease entirely. A single age-60 rule will get at least two of the three wrong. SOCSO has a further trap — an employee first insured after age 55 is in the Second Category even while under 60, and EIS excludes anyone first employed after 57. 8. FOUR DIFFERENT WAGE BASES ON ONE PAYSLIP. EPF "wages" under section 2 of Act 452 (broad: salary, bonus, commission, allowances, leave pay; excluding service charge, overtime, gratuity, retirement and retrenchment benefits, and travelling allowance). SOCSO and EIS wages (their own definitions, capped at RM6,000). HRD Corp levy base (basic salary plus fixed allowances only — narrower than all of them, and uncapped). Computing one and reusing it across the others is wrong in several directions. 9. THE HRD CORP LEVY IS REAL, UNCAPPED AND USUALLY MISSING. 1% of basic-plus-fixed-allowances for employers with 10 or more Malaysian employees, 0.5% for 5 to 9. Because it is uncapped, for a senior employee it can exceed the combined SOCSO and EIS employer cost several times over. Employers with fewer than 5 Malaysian employees are outside it. 10. EPF IS A PROVIDENT FUND, NOT INSURANCE, AND SOCSO IS THE ONLY POOLED-RISK BRANCH. EPF money accrues to the member's own three-part account. SOCSO is the only scheme paying pooled invalidity, injury and survivor benefits. EIS is a narrow retrenchment scheme that does not pay out on resignation. Malaysia has NO contributory state health insurance and no general unemployment benefit — do not create phantom branches for either. 11. EMPLOYEE EPF IS TAX-RELIEVED BUT WITHIN A SHARED CAP. Employee EPF contributions are deductible against income tax within the combined EPF-and-life-insurance relief limit, which most full-time employees exhaust on EPF alone. SOCSO and EIS employee contributions attract their own small separate relief. Employer contributions to all schemes are deductible business expenses. SUB-NATIONAL VARIATION: NONE. EPF, SOCSO, EIS and the HRD Corp levy are all federal, with identical rates, schedules and ceilings in every state including Sabah and Sarawak. There is no state payroll levy. The only differentiation is by AGE, CITIZENSHIP, WAGE BAND and EMPLOYER SIZE — never by location. Do not model MY-01/MY-12/MY-13 as rate dimensions. WHAT WE DO NOT PUT A NUMBER ON, DELIBERATELY. THE FULL THIRD SCHEDULE AND SECOND SCHEDULE TABLES — not reproduced. EPF's table runs to hundreds of RM20 bands and SOCSO's and EIS's to dozens of brackets. The governing percentages, the ceilings and the exact top-bracket amounts are served so an engine knows what it needs, but the correct row must be read off the schedule for the employee's actual wage. This is why the percentages here should be treated as descriptive rather than operative. VOLUNTARY EPF ELECTIONS — not modelled. Employees may elect to contribute above the statutory rate (and 60-plus members may elect to contribute at all); employers may agree to contribute above the schedule. Both are contractual and cannot be derived from statute. WORKMEN'S COMPENSATION FOR EXCLUDED CATEGORIES — not priced. Categories of worker outside SOCSO remain subject to separate employer liability arrangements with no published contribution rate. ALREADY LEGISLATED, NOT YET IN FORCE / WATCH LIST. (1) The extension of mandatory EPF to non-citizens took effect on 1 October 2025 at 2%/2%; this rate was announced as a starting rate and should be re-verified annually in case it is stepped up. (2) The SOCSO and EIS wage ceiling moved from RM5,000 to RM6,000 on 1 October 2024 after standing at RM4,000 and then RM5,000 for long periods — it is raised by amending the schedules and is due for periodic review, so it is not a constant. (3) EPF statutory rates have been changed temporarily before, most notably the employee rate being cut to 9% for 2021 and to 7% for part of 2020 as a pandemic measure, by amending the Third Schedule. A rate cut announced in a federal Budget can therefore take effect quickly — a Budget-day re-check each October is warranted. (4) The HRD Corp levy scope was substantially expanded in 2021 and further sector additions are made by order. SOURCING CAVEATS, STATED PLAINLY. The RM6,000 wage ceiling and its 1 October 2024 effective date are quoted directly from PERKESO's own "Rate of Contribution" page, which also confirms that the operative instruments are the Third Schedule to Act 4 and the Second Schedule to Act 800. THE PERCENTAGE RATES AND THE TOP-BRACKET CASH AMOUNTS WERE NOT READ FROM THE SCHEDULES THEMSELVES — PERKESO's page links the schedules as PDFs and does not display the rates, and the EPF's own site refused automated access. The figures served (SOCSO 1.75%/0.5% and 1.25%; EIS 0.2%/0.2%; the maxima RM104.65, RM29.90, RM74.75 and RM11.90; EPF 11%/13%/12%, 4% at 60-plus and 2%/2% for non-citizens from 1 October 2025) are taken from multiple independent Malaysian payroll and professional sources that agree with each other and with PERKESO's stated ceiling. The internal arithmetic is a useful cross-check: the maxima are all slightly BELOW the percentage applied to RM6,000, which is exactly what a bracketed schedule produces and is not consistent with any of these sources having simply multiplied the percentage out. The EPF Act section numbers and Schedule Parts are cited from the standard consolidation rather than verified against the Act. Employee and employer shares are stated separately: the employee figure is what leaves the payslip, the employer figure is cost of employment and is not a deduction.

Get it programmatically

curl https://asiaref.dev/v1/my/social-contributions
# $0.005 per call — x402 on Base (USDC). No key, no signup.
# History:    curl https://asiaref.dev/v1/my/social-contributions/history?from=2020-01-01
# Provenance: curl https://asiaref.dev/provenance/my/social-contributions

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