EPF Rates 2026: The Employee + Employer Split, Explained

EPF is the biggest single deduction on most Malaysian payslips. It's also the only one whose money you eventually get back, with dividends that have averaged above 6% for the past five years. Here's exactly what's deducted in 2026, the new options unlocked under Budget 2026, and how to push your contribution rate up if you want a fatter retirement.

The mandatory rates: employee vs employer

For Malaysian citizens below age 60, the statutory split is fixed by EPF Act 1991, Third Schedule¹:

After age 60, contribution rates change:

A Malaysian aged 60+ can opt out of contribution entirely under EPF Act Section 50A — but most stay in for the dividend.

Non-Malaysian citizens were brought under mandatory EPF starting 1 October 2025. Same 11% employee rate, 12-13% employer rate depending on wage band. First payment for non-citizen employees was due 15 November 2025¹.

The Jadual Ketiga quirk — why it isn't exactly 11%

For wages up to RM 20,000, KWSP doesn't use a pure percentage. It uses the Third Schedule (Jadual Ketiga) which bands wages in RM 20 steps and assigns a fixed contribution per band². The effect is small — the actual deduction rounds up to the next RM 20 wage band before applying the rate, so your real deduction may differ from salary × 11% by up to a ringgit.

Example: salary RM 4,990 → wage band RM 5,000 → employee 11% × 5,000 = RM 550 (not RM 548.90).

This matters most for employers reconciling payroll: KWSP rejects payments that don't match the Jadual Ketiga value exactly.

Voluntary options — i-Simpan, i-Topup, KWSP 17A

You can push above the statutory 11% if you want a bigger retirement pot.

Tax relief: voluntary EPF (i-Simpan + i-Topup) is tax-deductible up to RM 7,000/year, separate from the standard EPF + life insurance relief.

i-Saraan and the new i-Saraan Plus for gig workers

i-Saraan is EPF's matching programme for self-employed contributors — freelancers, hawkers, full-time parents, anyone without a salaried employer⁴.

• Contribute any amount voluntarily; government matches 20% of your total annual contribution
• Annual cap: RM 500 matching incentive
• Lifetime cap: RM 5,000 matching (or until age 60, whichever first)
• To max out the RM 500 annual incentive: contribute at least RM 2,500/year

Uptake has been strong: 720,056 incentive recipients in 2025 (up 35.9% YoY), total voluntary contributions of RM 19.2 billion across all categories⁵.

i-Saraan Plus (new, effective 1 January 2026) is the gig-economy-specific variant under Budget 2026⁵:

• For e-hailing + p-hailing drivers (Grab, Foodpanda, Lalamove, etc.)
• Higher government matching: up to RM 600/year
• Lifetime cap: RM 6,000
• Drivers register through platform providers; contribution deducted at driver-set rates from earnings

i-Suri — eligibility extended to age 60 in 2026

i-Suri is EPF's matching programme for housewives. From 1 January 2026, eligibility age extended from 55 to 60, aligning with the national minimum retirement age⁵.

• Government matches 50% of annual contribution
• Annual cap: RM 300 matching
• Lifetime cap: RM 3,000

EPF dividend record — 2024 vs 2025

Both rates well above the legislated minimum of 2.50% for Simpanan Konvensional. The 2025 dividend dropped 0.15 percentage points YoY despite higher total payout, reflecting larger accumulated balances rather than weaker returns.

EPF dividends are tax-exempt — full credit to your account, no PCB withholding, no Form B declaration required⁶.

Worked example — RM3,000 / RM5,000 / RM10,000 monthly salary

For three Malaysian citizens, age 30, applying the Jadual Ketiga banding:

Over 12 months, the RM 5,000 earner accumulates RM 14,400 into EPF before any voluntary top-up. With FY2024's 6.30% dividend applied to last year's balance, even an accumulated RM 100,000 generates RM 6,300/year in tax-free dividend — roughly RM 525/month effectively rebated for doing nothing.

For your exact contribution under your own salary, age, and citizenship — including the Jadual Ketiga banding — run the Celik Finance salary calculator. It implements the full Third Schedule lookup and the post-60 rate switch. Your net pay after EPF also feeds directly into your DSR calculation when you apply for a home loan.