What Has the MPFA Proposed?
On 31 March 2026, the MPFA presented a proposal to the Labour Advisory Board to raise the "relevant income levels" that determine how much mandatory MPF contribution you and your employer must pay. This is part of the MPFA statutory four-year review cycle (2022-2026), following consultation with over 30 stakeholder groups.
| Current | Proposed (not final) | |
|---|---|---|
| Minimum relevant income (below this, no mandatory contribution) | $7,100 / month | $10,500 / month |
| Maximum relevant income (contribution calculation cap) | $30,000 / month | $40,000 / month |
| Monthly mandatory contribution cap (5%) | $1,500 | $2,000 |
What Does This Mean for High Earners?
If your monthly salary already reaches $30,000 or above (i.e. you already hit the current contribution cap), you currently contribute $1,500 a month to your MPF, matched by another $1,500 from your employer — $36,000 a year combined.
If the proposal goes through, employees earning $40,000 or more a month would see their mandatory contribution rise from $1,500 to $2,000 — an extra $500 from you and another $500 from your employer, adding up to $12,000 more a year (employer plus employee combined). If you run your own business or manage a team of higher-paid staff, this extra labour cost is worth factoring into your budget early.
Do Not Confuse This With the $60,000 TVC Cap
Many people hear "contribution cap" and think of the $60,000 annual cap on Tax Deductible Voluntary Contributions (TVC). The two are completely different things:
- Mandatory contribution cap: the statutory amount employers and employees must pay — this is what the proposal would adjust
- TVC voluntary contribution cap: the flexible amount you choose to contribute for tax deduction, $60,000 a year, unaffected by and unrelated to this proposal
To learn how TVC can save you tax, read our article: After You Max Out TVC: The Step High Earners Miss.
Good or Bad News for Your Retirement Gap?
In the short term, a higher contribution cap reduces your take-home pay, since mandatory contributions are deducted from your salary. But over the long run it actually helps — mandatory saving is not optional, but it does force many people to set aside more for retirement than they otherwise would. The catch: even at the current $1,500 cap, that alone is unlikely to be enough for retirement.
- How many funds are in your MPF account, and are they keeping up with the market?
- How large is your actual retirement gap?
- Beyond mandatory contributions, are you using TVC or other tools to close the gap?
What Can You Do Now?
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01
Record Your Current Contributions
Take a snapshot of your current MPF contribution amount and fund allocation as a baseline.
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02
Calculate Your Actual Retirement Gap
Use our Retirement Calculator to see your current gap — do not rely on mandatory contributions alone.
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03
Get an Independent Advisor to Review Everything
Review your MPF and TVC allocation together in one pass — no need to wait for the policy to become final.
Next Steps
- This proposal is still under consultation — follow official updates from the MPFA and the government rather than rumours
- Want to know if your MPF/TVC portfolio is keeping up with the market? Get a free review from us
- Want to calculate your own retirement gap? Use our Retirement Calculator
Sources: MPFA Chairman Blog, "Contributing a Little More for Greater Retirement Protection" (8 March 2026), and the MPFA proposal on relevant income levels presented to the Labour Advisory Board on 31 March 2026 — mpfa.org.hk; specific proposed figures cross-checked against financial media reporting including The Standard and HKEJ. This article is general educational content and does not constitute investment or tax advice. The proposal remains under consultation and has not been enacted into law — please confirm the final figures and effective date against official MPFA and government announcements.