sosazr
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Assalamualaikum
It’s sound very nice when the government give permission to reduce EPF contribution lower than 11% currently. Instead, the practice methods is, all the companies have to enforce the employee only contribute 8% and for those employee not interested to reduce have to fill a special form. What’s behind this?:-?
Let assume the income is RM4000 then
If your monthly EPF contribution is 11% ( RM440 ), taxable income = RM3560, income tax payable = RM77.
If your monthly EPF contribution is 8% ( RM320 ), taxable income = RM3680, income tax payable = RM109.
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What’s the difference? You’re paying RM32 more on tax and you’re less saving for retirement. 3% make a huge difference, it is about RM100 a month, RM1200 a year and RM12000 a decade.
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On 1st December 2008, EPF will produce a new form for this. Decision is yours!

Wallahua’alam.
It’s sound very nice when the government give permission to reduce EPF contribution lower than 11% currently. Instead, the practice methods is, all the companies have to enforce the employee only contribute 8% and for those employee not interested to reduce have to fill a special form. What’s behind this?:-?
Let assume the income is RM4000 then
If your monthly EPF contribution is 11% ( RM440 ), taxable income = RM3560, income tax payable = RM77.
If your monthly EPF contribution is 8% ( RM320 ), taxable income = RM3680, income tax payable = RM109.
What’s the difference? You’re paying RM32 more on tax and you’re less saving for retirement. 3% make a huge difference, it is about RM100 a month, RM1200 a year and RM12000 a decade.
On 1st December 2008, EPF will produce a new form for this. Decision is yours!
Wallahua’alam.