How to calculate salaries?
Salaries are typically calculated and paid on a monthly or daily basis.
Monthly salary calculation (for incomplete month’s pay):
(Monthly gross rate of pay) / (Total number of days in that month) x (Total number of days the employees worked in that month)
Daily salary calculation:
(12 x Monthly basic rate of pay) / (52 x Average no. of days an employee is required in a week)
How to calculate MPF contributions?
Both employers and employees are required to contribute 5% of the employee’s monthly relevant income to the MPF scheme.
Monthly Relevant Income* | Employer’s Contribution | Employee’s Contribution |
Less than $7,100 | Relevant income x 5% | No contribution required |
$7,100 to $30,000 | Relevant income x 5% | Relevant income x 5% |
More than $30,000 | $1,500 | $1,500 |
*Relevant income includes wages, leave pay, fees, commissions, bonuses and allowances
For the latest rates and definitions of relevant income, visit the MPF website.
To simplify payroll management, consider using payroll software such as HREasily, Telenox or QuickBooks Payroll to automate salary and MPF calculations, as well as tax filing, ensuring compliance with Hong Kong’s regulations.
Note: This publication is provided for general information purposes and does not constitute legal, tax, financial, investment, or other professional advice from Aspire FT Pte. Ltd. or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a qualified financial advisor, tax professional, attorney, or any other licensed professional.
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