EPF SOCSO EIS Contribution 2026: Latest Rates, Rules & Employer Guide in Malaysia

Every employer in Malaysia must manage EPF, SOCSO, and EIS contributions as part of their monthly payroll responsibility. These contributions form an important part of employee protection and retirement planning.

With regulatory updates taking effect in 2024 and 2025, including changes to foreign worker EPF contributions and the SOCSO and EIS wage ceiling, HR teams need to stay informed. This article provides a clear 2026 update on contribution rates, payment rules, and employer obligations.

Recent Regulatory Updates

Several important regulatory updates affect EPF, SOCSO, and EIS contributions in 2026.

Starting October 2025, EPF contributions became mandatory for foreign workers. The contribution rate is 2% from the employer and 2% from the employee.
Beginning October 2024, the wage ceiling for SOCSO and EIS increased from RM4,000 to RM6,000. This affects how contribution amounts are calculated.
The employee EPF contribution rate remains at 11%. The temporary reduction to 9% ended in January 2022.

Employers must stay updated with these changes to avoid compliance risks and penalties.

EPF (Employees Provident Fund / KWSP)

EPF is governed by the EPF Act 1991. It is a retirement savings scheme for employees in Malaysia.

Each month, both employer and employee contribute to the fund. These savings are invested and managed under either:

Simpanan Konvensional
Simpanan Shariah

The savings grow through annual dividends declared by KWSP.

Payments Subject to EPF

Payments Subject to EPF Contribution

The following payments are subject to EPF:

Salary
Bonus
Allowances (with certain exceptions)
Commission
Incentives
Arrears of wages
Payment for unutilised leave
Paid maternity leave and study leave wages
Other contractual payments

Payments Not Subject to EPF

The following payments are not subject to EPF:

Overtime
Travel allowance
Director’s fees
Gifts
Benefits-in-kind
Termination benefits
Gratuity
Retirement benefits

EPF Contribution Rates (2026)

Contribution rates differ based on age, salary level, and nationality.

Malaysian Employees Below 60 Years Old

Monthly Salary	Employer	Employee
RM5,000 and below	13%	11%
More than RM5,000	12%	11%

Malaysian Employees Aged 60 and Above

Status	Employer	Employee
Age 60+	Lower rates apply (refer Third Schedule)	Lower rate

Permanent Residents

Similar rates apply as Malaysian citizens depending on age.

Foreign Workers (Effective October 2025)

Category	Employer	Employee
All foreign workers	2%	2%

This requirement applies to wages paid from October 2025 onwards.

Important note:

EPF contributions must be calculated using the Third Schedule contribution table, not simply by multiplying the percentage, except for salaries above RM20,000.

SOCSO Contribution Rates (2026)

SOCSO is governed under the Employees’ Social Security Act 1969.

It covers the Employment Injury Scheme and the Invalidity Scheme

Contribution rates are as follows:

Employee Category	Employer Contribution	Employee Contribution
Malaysian & PR (Below 60 years old)	1.75%	0.5%
Malaysian & PR (60 years and above)	1.25%	0%
Foreign Workers (All ages)	1.25%	0%

The wage ceiling for SOCSO is RM6,000 per month effective October 2024. Employers must calculate contributions using the official SOCSO Rate of Contribution table.

EIS Contribution Rate 2026

The Employment Insurance System (EIS) is governed under the Employment Insurance System Act 2017.

EIS protects employees aged 18 to 60 who lose employment.

Contribution rates for employer and employee are the same, 0.2%. The wage ceiling is also RM6,000. EIS is paid together with SOCSO.

Payment Deadlines Section

All EPF, SOCSO, and EIS contributions must be paid by the 15th of the following month for the previous month’s salary.

Contribution Type	Payment Deadline
EPF	By 15th of following month
SOCSO	By 15th of following month
EIS	Paid together with SOCSO (by 15th)

Late payment will result in penalties.

Penalties for Late Payment

EPF

Late Payment Charge calculated based on EPF dividend rate + 1% per annum
Minimum charge RM10
Criminal penalties may apply (up to RM10,000 fine or imprisonment)

SOCSO

6% per annum interest charged per day on outstanding contributions

EIS

Follows the SOCSO penalty structure

FAQs

What happens if I pay late?

Late payment will result in financial penalties. EPF may impose late payment charges and criminal penalties. SOCSO and EIS will impose daily interest charges.

Are foreign workers covered?

Yes. Foreign workers must contribute to EPF starting October 2025 at 2% employer and 2% employee. They are also covered under SOCSO.

Do part-time employees need EPF, SOCSO, and EIS?

Yes, if they are employed under a contract of service and meet the eligibility requirements.

Is contribution based on exact percentage?

For EPF, use the Third Schedule contribution table. For SOCSO and EIS, use the official Rate of Contribution tables because contributions are capped at RM6,000.

When must I register as an employer?

EPF: Within 7 days of hiring your first employee
SOCSO: Within 30 days of hiring your first employee

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