MPF Contributions for Employers: How to Calculate, Pay and Book Them

By Di Ma, Project Manager 29 OCT 2026 · 4 MIN READ

Every Hong Kong employer with staff on the Mandatory Provident Fund pays contributions every month: its own, and the employee's share deducted from pay. The rules are simple, but MPF is also where small companies' payroll books most often go wrong. Here's how to calculate, pay and book it.

The contributions

Under section 7A of the Mandatory Provident Fund Schemes Ordinance, the employer contributes from its own funds and deducts the employee's contribution from their pay. The MPFA's current figures for monthly-paid employees:

Mandatory contributions for a monthly-paid employee (MPFA, October 2026)
Monthly relevant income	Employer	Employee
Below HK$7,100	5%	Nil
HK$7,100 to HK$30,000	5%	5%
Above HK$30,000	HK$1,500	HK$1,500

So an employee on HK$25,000 a month costs the company HK$1,250 in MPF, and has HK$1,250 deducted. Above HK$30,000, both contributions stop at HK$1,500.

What counts as relevant income

Included: wages, salary, leave pay, fees, commissions, bonuses, gratuities, perquisites and allowances.
Not included: severance and long service payments under the Employment Ordinance, and non-cash benefits such as meals provided at work.

Bonuses and commissions catch people out: they're relevant income for the period they're paid in, so the contribution for that month is higher, up to the HK$1,500 cap.

When to pay: the contribution day

For monthly-paid employees, contributions are generally due by the 10th day of the following month, moving to the next working day if the 10th is a Saturday or public holiday. Pay the employer's and the employee's share together to the trustee, with the remittance statement.

New employees: the first 30 and 60 days

The employer contributes from day one.
The employee has a contribution holiday for their first 30 days of employment: nothing is deducted from their pay for that period.
The first contributions are due by the contribution day after the calendar month in which the employee's 60th day of employment falls. That's also the practical deadline for enrolling them in the scheme.

The bookkeeping

One month's payroll, salary HK$25,000 (illustrative)
When	Entry
Payroll for the month	Dr Staff salaries 25,000 Cr Bank (net pay) 23,750 Cr MPF payable (employee 5%) 1,250
Employer's contribution	Dr Staff MPF 1,250 Cr MPF payable 1,250
Paid to the trustee by the 10th	Dr MPF payable 2,500 Cr Bank 2,500

Salaries at gross. The employee's 5% is part of their salary cost, withheld and paid on their behalf, not a separate expense.
The employer's 5% is an expense in its own account, such as "Staff MPF", so it's visible in the income statement.
MPF payable is a liability that builds up during the month and is cleared by the payment to the trustee.

The Certanta client portal, income statement of the fictional demo company Harbourfront Trading Ltd for 1 January to 30 September 2026, with expense lines including bank charges, depreciation, freight and delivery, office and IT, professional and audit fees, rent and rates, staff salaries and MPF, and travel and entertainment. — Staff salaries and MPF in the demo company's income statement.

Month-end check: the MPF payable account

At each month end, the MPF payable balance should equal exactly the contributions for that month that are due by the 10th of the next. If it doesn't:

Higher than expected: a payment to the trustee was missed, or booked to the wrong account.
Lower, or negative: a contribution was paid but the payroll wasn't booked, or a payment was counted twice.
An old balance that never clears: usually a surcharge, a joiner's back-dated contributions or a leaver's adjustment that was booked on one side only.

This is part of the monthly close (see the month-end close checklist), and the year's totals tie into the employer's return.

If a contribution is late

A contribution not paid by the contribution day becomes due to the MPFA, and the employer also has to pay a contribution surcharge calculated on the arrears (section 18). The surcharge is a cost of the company, booked separately from the contributions, and the employee's share of a late contribution is still the employee's money, held by the company until it's paid.

Set up the trustee payment as a recurring transfer a few days before the 10th, and match it to the MPF payable account each month. It's the simplest way to never be late.

How Certanta helps

Payroll booked every month: salaries at gross, the employer's MPF in its own account, and MPF payable as a liability.
The MPF payable account checked at every month end, so a missed payment shows up in weeks, not at the audit.
Ask your books. "How much did we pay in MPF this year?" is a question for the AI assistant in your portal.

Frequently asked questions

How much MPF does an employer pay in Hong Kong?

5% of the employee's relevant income each month, with the employee also contributing 5%. For monthly-paid employees, relevant income above HK$30,000 is capped, so each side pays at most HK$1,500; below HK$7,100, only the employer contributes (MPFA figures, October 2026).

When are MPF contributions due?

For monthly-paid employees, generally by the 10th day of the following month, or the next working day if the 10th is a Saturday or public holiday.

Do new employees pay MPF in their first month?

The employee has a contribution holiday for the first 30 days of employment, but the employer contributes from the first day. The first contributions are due by the contribution day after the calendar month in which the 60th day of employment falls.

Are bonuses subject to MPF?

Yes. Relevant income includes bonuses, commissions, gratuities and allowances, as well as wages, salary, leave pay and fees. Severance and long service payments under the Employment Ordinance are excluded.

How should MPF be recorded in the books?

Book salaries at gross, with the employee's 5% deducted into an MPF payable account; book the employer's 5% as an expense, also into MPF payable; then clear MPF payable when the contributions are paid to the trustee.

What happens if MPF contributions are paid late?

Under section 18 of the Mandatory Provident Fund Schemes Ordinance, an unpaid contribution becomes due to the MPFA after the contribution day, and the employer also has to pay a contribution surcharge calculated on the arrears.

Payroll and MPF, booked every month

Certanta books salaries and MPF each month in their own accounts and checks that the MPF payable account clears after every payment to the trustee.

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This article summarises the MPFA's published guidance on mandatory contributions and sections 7A and 18 of the Mandatory Provident Fund Schemes Ordinance (Cap. 485), as at 29 October 2026. It is general information, not legal, payroll or accounting advice. Income levels and rules change; check the MPFA's current guidance and your trustee's instructions.