As of 1st December 2000, the Mandatory Provident Fund (MPF) system requires all employers and self-employed people in Hong Kong to establish a MPF scheme for their employees or themselves. Both employers and employees are required to make regular contributions to MPF schemes.

Persons exempted from the system are:

• Those 64 years of age or older in December 2000
• Those employed for less than 60 days
• Those employed in the European Union Office of the European commission in Hong Kong
• Domestic workers, civil servants, teachers in granted or subsidized schools and hawkers
• Those entering Hong Kong for less than 12 months
• Members of pension schemes outside of Hong Kong
• Members of exempted schemes approved by the MPF Authority

Employers are required to contribute 5% of an employee's monthly income from his/her monetary resources (including paid leave, commissions, bonuses, gratuity or allowances other than housing allowances). Employees are also required to contribute 5% of monthly income as well. Additionally, payments can be made above the mandatory level by either the employer or the employee.

Withdrawal of benefits can be made under the following circumstances:

• Age 65
• Permanent retirement at an age over 60 years
• Leaving Hong Kong permanently
• Death
• Total incapacity
• If no mandatory payments were required for 12 months and the total benefits are under HK$5,000

Should an individual change jobs, accrued benefits can be kept in the same MPF, transferred to a new employer's MPF scheme or transferred to any other MPF scheme nominated by the individual. Contact your Inter-Alliance WorldNet's Adviser for advice or recommendations of MPF schemes.