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Contribution Pension Scheme(CPS)


The Pension Reform Act empowers the employee to choose his/her Pension Fund Administrator (PFA), open and maintain a Retirement Savings Account (RSA). Employer shall deduct at source and within Seven (7) working days from the date the employee is paid his salary, remit both the employee’s and employer’s contributions directly to the Pension Fund Custodian (PFC) specified by the PFA. See Section 11 (3). Rates of contributions are as set out below:

Category Before - 2004 Act Now – 2014 Act
Employee 7.5% of Monthly Emoluments - Basic Salary Housing and Transport Allowance) 8% of Monthly Emoluments (see definition below)
Employer 7.5% of Monthly Emoluments - Basic Salary Housing and Transport Allowance 10% of Monthly Emoluments (see definition below)

Note: employer may elect to bear full responsibility of payment under the Scheme provided the contributions shall not be less than 20% of monthly emolument of employee.

Click here for provisions of the CPS