Required certification · Malaysia
EPF / KWSP
Mandatory employer registration and monthly retirement-savings contributions
Market position
The Employees Provident Fund (EPF, or KWSP) is the statutory retirement-savings fund under the Employees Provident Fund Act 1991. Employers must register with the EPF and pay monthly contributions, covering both the employer and employee shares, for their employees. News reports say contributions became mandatory for non-Malaysian employees from October 2025 wages, at 2% each from employer and employee.
Malaysia-specific note
Under section 41 of the EPF Act 1991 an employer must register with the EPF before the end of the first week of the first month in which it pays wages that attract contributions, and must then pay contributions every month. The 2006 reprint of the Act sets up to three years' imprisonment or a fine of up to RM10,000 for failing to register or to pay. Contractors with foreign workers should check the current rules for non-Malaysian employees, which the Cabinet was reviewing in July 2026, news reports say.
Pros
- + Registering lets an employer hire and pay staff in line with the EPF Act
- + Contributions build employees' retirement savings in the Fund
- + Employer and employee may choose to contribute above the statutory rate (s.43(3))
Cons
- − Registration is due within the first week of the first month wages are paid
- − Contributions are due every month for every covered employee
- − Failing to register or pay can bring a fine of up to RM10,000 or imprisonment
- − Wage records must be kept for at least six years
Typical Malaysia pricing
Employers pay monthly contributions (employer and employee shares) at the statutory rates set under the EPF Act 1991. Current rates are published by the EPF, whose website could not be read in this check.
Why this matters for Malaysia trades
Under Act 520, every local and foreign contractor must register with CIDB (the Construction Industry Development Board), which grades contractors G1 to G7 with works limits from RM200,000 (G1) to no limit (G7), issues the SPKK certificate for government works and registers construction workers, site supervisors and project managers through the Green Card; working unregistered risks a fine of RM10,000 to RM100,000. LHDN/IRBM runs income tax, employers’ monthly PCB/MTD deductions and the MyInvois e-invoicing system. SSM (the Companies Commission of Malaysia) registers businesses, companies and LLPs; under Act 138 only a Professional Engineer or engineering consultancy practice registered with the Board of Engineers Malaysia (BEM) may submit engineering plans to an authority; and employers must register with and pay monthly contributions to EPF/KWSP and to SOCSO/PERKESO (including EIS), with HRD Corp registration and levy required at 10 or more employees in covered industries.
Malaysian construction and trades software selection is shaped by MyInvois, the national e-invoicing system run by LHDN/IRBM (the Inland Revenue Board), rolled out in phases by turnover from August 2024. Businesses with turnover up to RM5 million entered on 1 January 2026, but under LHDN’s e-Invoice Guideline of 30 August 2026 those below RM3 million are exempt unless a shareholder company, holding company, related company or joint venture has turnover of RM3 million or more, and an interim relaxation for the up-to-RM5 million phase runs to 31 December 2027, allowing consolidated e-invoices for taxpayers who meet its conditions. AutoCount, SQL Account, Bukku and other local accounting and ERP vendors listed here say they submit e-invoices to MyInvois. Add the Ringgit (MYR), SST, CIDB contractor grading from G1 to G7, and monthly EPF, SOCSO, EIS and PCB payroll deductions, with LHDN publishing a list of payroll software whose PCB calculation meets its specification.
Frequently asked
Is EPF / KWSP a good fit for Malaysia trades?
The Employees Provident Fund (EPF, or KWSP) is the statutory retirement-savings fund under the Employees Provident Fund Act 1991. Employers must register with the EPF and pay monthly contributions, covering both the employer and employee shares, for their employees. News reports say contributions became mandatory for non-Malaysian employees from October 2025 wages, at 2% each from employer and employee. Under section 41 of the EPF Act 1991 an employer must register with the EPF before the end of the first week of the first month in which it pays wages that attract contributions, and must then pay contributions every month. The 2006 reprint of the Act sets up to three years' imprisonment or a fine of up to RM10,000 for failing to register or to pay. Contractors with foreign workers should check the current rules for non-Malaysian employees, which the Cabinet was reviewing in July 2026, news reports say.
What does EPF / KWSP cost in Malaysia?
Employers pay monthly contributions (employer and employee shares) at the statutory rates set under the EPF Act 1991. Current rates are published by the EPF, whose website could not be read in this check. Pricing and availability can change by region; confirm current Malaysia pricing on the vendor's site before committing.