Notes
The glossary contained certain terms referred to or used throughout this website. The glossary is compiled by China Life Trustees Limited from sources which are believed to be reliable and for easy reference only. Whilst reasonable care has been taken in the preparation of this glossary, it must not be regarded as a substitute for a review of the Mandatory Provident Fund Schemes Ordinance and/or other relevant legislation. Members should take their own legal advice in relation to the statutory meanings
Accrued benefits(累算權益)
The amount of a member's beneficial interest in an MPF scheme at a particular time, calculated as the contributions, made by or in respect of that member, together with any investment return (profit or loss).
Constituent fund(成分基金)
The fund which is the investment vehicle for a registered MPF scheme, or a fund which forms part of the investment vehicles for a scheme.
Contribution day(供款日)
Employers are required to pay mandatory contributions to the scheme's trustee on or before the contribution day.
In the case of employees (other than casual employees), the contribution day is defined as the 10th day after the last day of:
(a) a calendar month within which the relevant contribution period ends, or
(b) the month during which the permitted period ends, whichever is the later.
In the case of casual employees who are not members of an industry scheme, the contribution day is defined as the 10th day after the last day of:
(a) the relevant contribution period, or
(b) the contribution period during which the permitted period ends, whichever is the later.
In the case of self-employed persons, the contribution day is defined as the end of the contribution period.
Contribution period(供款期)
In relation to an employer:
A contribution period means each period for which the employer pays or should pay relevant income to the employee.
In relation to an employee(other than a casual employee):
| (a) |
where the wage period is not more than 1 month (e.g. weekly or monthly), a contribution period means each period for which the employer pays or should pay relevant income to the employee, but does not include any wage period commencing on or before the 30th day of employment; |
| (b) |
where the wage period is more than 1 month (e.g. quarterly), a contribution period means each period for which the employer pays or should pay relevant income to the employee, but does not include the period commencing from the date of employment and ending on the last day of the calendar month in which the 30th day of employment falls. |
In relation to a casual employee:
A contribution period means each period for which the employer pays or should pay relevant income to the employee. In relation to a self-employed person:
A contribution period may either be a year or a month, at the self-employed person's option. Such a person must inform the trustee at least 30 days before the end of each financial period of the scheme:
| - |
the relevant income for the next financial period of the scheme; |
| - |
whether he will contribute yearly or monthly. If the self-employed person chooses to contribute on a monthly basis, he can specify in writing to the scheme trustee his contribution period; his monthly contribution is due on the last day of contribution period. If he chooses to contribute on a yearly basis, his contribution day is the financial year end of the scheme in which he has enrolled. |
Employee's relevant income(僱員有關入息)
Relevant income of an employee will include wages, salaries, leave pay, fee, commission, bonus, gratuity, perquisite or allowance and also housing allowance or housing benefit, paid or payable by an employer to an employee in consideration of the employment contract, but excluding severance payments and long service payments.
Permitted period(特准限期)
The period by which an employer must enrol their eligible employees into an MPF scheme after employment. For self-employed persons, this is the period by which they must enrol themselves into an MPF scheme after becoming self-employed.
Portability(可調動性)
When a member changes job, or a self-employed person ceases to be self-employed and becomes an employee of an employer, benefit can be transferred to:
a) Another scheme e.g. the new employer's employer sponsored scheme or master trust scheme;
b) Another account within the same scheme; or
c) An account in another scheme of his own choice.
Preservation(保存)
Accrued benefits of mandatory contributions in the member account(s) will be preserved until payment.
Accrued benefits of mandatory contributions become payable when the member
a) Attains retirement age of 65;
b) Retires between 60 and 64;
c) Permanently departs from Hong Kong (only once in a life time);
d) Becomes totally incapacitated;
e) Dies; or
f) Has a small balance account
Preserved account(保留帳戶)
An account with an MPF scheme (other than a contribution account) in which the accrued benefits in respect of any former employment or former self-employment of the member are held.
Rebalancing of existing investment allocation portion(重整現有累算權益投資比重)
Redeem units in existing investment accrued benefits and use the proceeds to subscribe units according to the investment proportion instructed by member's new fund allocation choice.
Self-employed persons(自僱人土)
Person who derived income from his own production of goods and services or his trade of goods and services and he is not employed as an employee, for example sole proprietor or partner in a partnership.
Self-employed person's relevant income(自僱人土之有關入息)
| a) |
By Notice of assessment
A self-employed person may use the assessable profits stated in the most recent Notice of Assessment as his relevant income for the purpose of mandatory contributions. |
| b) |
By self declaration
A self-employed person may declare in writing as his relevant income an amount equal to the person's assessable profits for the preceding year of assessment to the scheme trustee under the following circumstances: |
- The period between the issuance date of the most recent Notice of Assessment and the date on which the notice is presented as evidence of relevant income exceed 2 years;
- The latest tax assessment is objected by the self-employed person; or
- The self-employed person has not produced the most recent Notice of Assessment to the scheme trustee as evidence of his relevant income
| c) |
By contributing the maximum level of relevant income
Self-employed person does not have to produce evidence of income or to make declaration to the scheme trustee if he chooses to contribute the maximum level of relevant income (i.e. HK$1,000 monthly or HK$12,000 yearly), |
| d) |
Unable to provide evidence of income
If the scheme trustee satisfies that a self-employed person is unable to provide any evidence of income (notice of assessment or declaration of profit) and the self-employed person claims that he earns less than the maximum level of relevant income, the basic personal allowance may be taken as the self-employed person's relevant income. |
| e) |
Negative income
If the self-employed person suffers losses, he may lodge with the trustee a statement showing the computation of the net loss in respect of his business. The net loss should cover the last financial period of the self-employed business. Mandatory contributions should be resumed when his relevant income exceeds the minimum level (i.e. HK$78,000 yearly). |
Surcharge(供款附加費)
A surcharge is a penalty imposed on employers if contributions are not paid within the legislative deadline. With effect from 1 February 2003, the surcharge is 5% of contributions in arrears, including both employer and employee mandatory contributions.
Vesting(歸屬)
Mandatory contribution paid (including employer's and employee's) and investment earnings derived from the mandatory contribution are fully and immediately vested as accrued benefits. When the employee ceases employment, irrespective of his service with the company, he will be entitled to 100% of the accrued benefits derived from employee and employer mandatory contributions. However, the entitlement of accrued benefits derived from employer voluntary contribution is usually subject to the governing rules set by the employer.
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