Short answer. EPF is a retirement savings scheme run by KWSP, SOCSO provides social security protection and EIS provides unemployment-related benefits, both run by PERKESO. Employers and employees contribute according to rates and wage ceilings published by the agencies. Always use the current tables from KWSP and PERKESO and pay by their deadlines.
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In this article
What each scheme covers
- EPF (KWSP): a compulsory retirement savings scheme for covered employees, with contributions credited to each member’s account.
- SOCSO (PERKESO): social security protection, including benefits for work injury and invalidity, for covered employees.
- EIS (PERKESO): support for covered employees who lose their jobs, such as job-search help and income support, as set by the scheme.
Who contributes and who is covered
Coverage depends on the employee’s nationality, age, wage and category, and these rules are updated. Employers contribute for covered employees, and employees contribute through deductions from wages. Foreign workers and employees above or below certain ages may be treated differently. Check each agency’s current rules.
How contributions are calculated
Need this done for you? Axecta’s payroll processing and employer compliance team can handle this for your company. See the payroll processing and employer compliance service.
The general process is:
- Identify which employees are covered under each scheme.
- Determine the wages that count for each scheme (the definition differs).
- Look up the contribution amount in the agency’s current table, or apply the stated percentage with any ceiling.
- Split the amount between employer and employee as the rules state.
Payment deadlines and channels
Each agency sets a monthly due date and accepted payment channels. Late payment can attract charges or dividends forfeited, depending on the scheme. Put all dates in your calendar. See the 2027 compliance calendar.
Special cases
- Foreign workers: different coverage rules.
- Directors: coverage depends on whether they are employees and how they are paid.
- Part-time and contract staff: check the definition of employee.
- Bonuses, commissions and allowances: may count as wages for contributions.
- Employees reaching specified ages: rules change.
Common errors
- Using last year’s table.
- Wrong wage definition for a scheme.
- Missing new joiners or continuing contributions for leavers.
- Paying the wrong amount or late.
- Not reconciling payroll records with agency statements.
A monthly reconciliation catches these. See the monthly payroll checklist.
How Axecta helps
Axecta’s payroll team applies the current tables, submits to KWSP and PERKESO and keeps proof of payment, so employers do not have to track changes in rates and ceilings themselves.
Rates stated by the agencies
| Scheme | Who | Rate stated |
|---|---|---|
| EPF | Employer, employee under 60 earning below RM5,000 | 13% employer (KWSP example) |
| EPF | Malaysian employee aged 60 and over | 4% employer, no employee share |
| EPF | Non-Malaysian registered from 1 August 1998 | 2% employer and 2% employee |
| SOCSO first category (under 60) | Employer and employee | 1.75% and 0.5% |
| SOCSO second category (60 and over) | Employer only | 1.25% |
| EIS | Employer and employee | 0.2% each (0.4% total) |
Sources: KWSP mandatory contribution, KWSP Third Schedule from October 2025, PERKESO contribution rate.
Wage ceiling and table use
A PERKESO page states that for employees earning more than RM6,000 a month, contributions are subject to a wage ceiling of RM6,000, effective October 2024. KWSP contributions are normally read from the Third Schedule table. Do not multiply wages by a flat percentage unless the schedule says so.
Monthly control
Keep a monthly sheet: employee, wage, EPF, SOCSO, EIS, date paid, receipt number. Compare it with agency statements each quarter.
Frequently asked questions
Who contributes to EPF, SOCSO and EIS?
Employers and covered employees, as set by each scheme’s rules.
What are the employer rates?
They are set by KWSP and PERKESO and change over time. Check the current tables.
When are contributions due?
By the monthly dates each agency sets. Confirm and calendar them.
Do foreign workers contribute?
The rules differ by scheme and status. Check the agencies or ask Axecta.
What is the EIS split?
0.2% from the employer and 0.2% from the employee, per PERKESO’s page as extracted.
Do foreign workers pay EPF?
KWSP’s page shows 2% each from employer and employee for non-Malaysians registered from 1 August 1998. Check for newer rules on its foreign worker pages.
Where do I find the table?
On KWSP’s Third Schedule document and PERKESO’s contribution tables.
Want contributions calculated and paid for you?
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Outsource contributions and submissions
Keep reading
- Employer Payroll Obligations in Malaysia
- Monthly Payroll Processing Checklist
- Outsourced Payroll Services: What Do They Include?
- Malaysian Company Compliance Calendar for 2027
- Common Sdn Bhd Compliance Mistakes in Malaysia
- What to Do After Incorporating a Sdn Bhd
- When to Hire Your First Employee in Malaysia: Timing, Cost and Set-Up
- Employee Costs & Hiring Employees: the full guide
Official sources to check
This article is general information and not legal, tax or accounting advice for your company. Rates, thresholds, deadlines and procedures change, so confirm current requirements with the sources above or with Axecta.