Have you heard of EPF i-Saraan (previously known as the 1Malaysia Retirement Savings Scheme or SP1M) or KWSP i-Saraan?
After learning more about the scheme, my husband and I registered for i-Saraan in 2018 and 2019 respectively.
In this post, I will share all I know about i-Saraan.
Since this is a long post, jump to whichever part you wish to read further.
Table of Contents
- What is i-Saraan?
- Who is eligible to register for i-Saraan?
- How to register for i-Saraan?
- How to make an i-Saraan contribution payment?
- What is the i-Saraan contribution limit?
- 6 Benefits of i-Saraan
- When will I receive the 15% i-Saraan contribution from the government?
- How to register as an EPF member?
- Final thoughts
What is i-Saraan?
Generally, all employees in Malaysia are aware that they must contribute to EPF (Employees Provident Fund) or locally known as KWSP (Kumpulan Wang Simpanan Pekerja).
Their employers will deduct the EPF contribution amount based on their salary range. And then submit these contributions to EPF together with the employer’s EPF contribution.
Other than this mandatory requirement by the EPF Act 1991, the EPF also accepts and encourages voluntary contribution from:
- self-employed individuals
- salaried workers
In other words, EPF accepts contributions from the self-employed individual who does not earn a regular income. And EPF also accepts additional contributions from salaried workers, on top of the mandatory amount deducted from their monthly salary.
Four types of EPF Voluntary Contribution
Currently, EPF offers four types of Voluntary Contributions.
Based on the screenshot above from the EPF website, a registered EPF member may make an optional contribution through the 4 EPF Voluntary Contribution schemes below:
- Self Contribution
- Kasih Suri Keluarga Malaysia KWSP (previously known as EPF i-Suri)
- Top-Up Savings Contribution
More details on each EPF Voluntary Contribution as below.
EPF Self Contribution
EPF Self Contribution is a voluntary contribution where all EPF members including salaried employees can make additional contributions to their EPF savings.
If you wish to know more details about EPF Self Contribution, you can read my other post on EPF Self Contribution.
As for i-Saraan, it is a voluntary contribution created especially for those who are self-employed. And there is a government incentive to encourage self-employed to contribute to their EPF savings.
The details of the i-Saraan government incentive are as below:
- eligible for a 15% matching incentive from the government
- government incentive is subject to a maximum of RM250 in a year
- the incentive is for members below 60 years old only (previously, was below 55 years old)
- the incentive is from the year 2018 to the year 2022
Kasih Suri Keluarga Malaysia KWSP (previously known as EPF i-Suri)
On the other hand, Kasih Suri Keluarga Malaysia KWSP is a government initiative for housewives, single mothers, and widows who are registered with e-Kasih.
If you wish to know whether you are registered with e-Kasih, you can check online at the e-Kasih official portal.
EPF Top-Up Savings Contribution
While the EPF Top-Up Savings Contribution is for EPF members who wish to top up EPF savings for their spouse or children.
With that said, i-Saraan is one of the four voluntary contribution schemes introduced by EPF. The scheme through i-Saraan is mainly for those who are not receiving a regular income to save up for their retirement.
Who is eligible to register for i-Saraan?
Individuals under self-employed and not receiving a fixed income are eligible to register for i-Saraan.
Based on the EPF website, some examples of those who fall under the self-employed category include the following:
- Grab and taxi drivers
- Hawkers and night market traders
- insurance agents, real estate agents, unit trust consultants
- Freelance workers (deejays, singers, actors, fitness instructors, and consultants)
- Business Owners (sole proprietors or partnerships)
- Professionals with their own practice (accountants, doctors, lawyers)
- Pensionable Employees
- Bloggers and content creators
In other words, a Malaysian who is not an employee is eligible to apply for the i-Saraan scheme.
As stated in the EPF website screenshot above, the criteria to register for i-Saraan are as below:
- Malaysian citizen
- Self-employed individuals
- Registered as an EPF member
- Below 60 years of age (Previously was below 55 years of age)
- Has opted to contribute under the i-Saraan (previously known as the SP1M) by submitting Form KWSP 16G(1M)
Thus, do take note that if you are an employee who receives regular income, you are not eligible to participate in the i-Saraan scheme.
How to register for i-Saraan?
Back in 2018 and 2019, my husband and I registered our i-Saraan at the EPF office in Kuching.
As of the time of writing, EPF members can also register i-Saraan online or through the EPF kiosk.
Register EPF i-Saraan online
For online registration, you may visit the i-Saraan online registration website.
Below is a screenshot of a part of the i-Saraan online registration form.
Then, you’ll need to fill in the form accordingly. Do take note of the i-Saraan online registration operating hours.
Since I am already a registered i-Saraan member, I can’t try out the online registration.
If you’ve tried online registration, perhaps share your experience in the comment below. I believe this will help other readers who are keen to register for i-Saraan online.
Personally, I think the online i-Saraan application is such a helpful initiative, especially during a pandemic like now when people prefer to do things digitally.
It is also convenient and hassle-free for EPF member to submit their i-Saraan application online.
Register i-Saraan at the EPF office
The sharing below is based on my husband and my experience registering our i-Saraan at the EPF Kuching office in 2018 and 2019.
1. Obtain KWSP Form 16G(M)
Interested individuals can apply by submitting KWSP Form 16G(M) – Application for Self-contribution (Government Incentives – i-Saraan/i-Suri).
The form is available from the nearest EPF branch office. It is free of charge.
Alternatively, you can download KWSP Form 16G(M)(PDF) from the EPF website. But, I would advise getting the form while you are at the EPF counter in case they have an updated version.
Please take note, even though you are an existing EPF member, you still need to register for i-Saraan by submitting KWSP Form 16G(M).
2. Fill up KWSP Form 16G(M)
Next is to fill up the form. When my husband and I filled up the form in 2018 and 2019, the form consists of 2 pages.
But the applicant only needs to fill up the first page. Which, consists of the applicant’s personal information and contact information.
While the second page consists of the guideline on how to fill up the form. Also, you can find additional information for both i-Saraan and i-Suri on the second page.
3. Submit KWSP Form 16G(M) to EPF
Lastly, submit the form by hand or by post to your nearest EPF branch office. I highly recommend interested individuals submit the form by hand to the nearest EPF branch office.
Because at the same time, you can get a ticket number and complete the submission immediately over the counter.
Do bring along a copy of your NRIC too.
Once completed, the EPF officer will print out the EPF i-Saraan confirmation notice. The applicant will get a copy of this confirmation notice as well.
Then, the applicant can immediately make his contribution to i-Saraan.
For my husband’s application, he submitted the form over the counter at the EPF Kuching branch in 2018. It took him about 30 minutes to complete everything.
As for me, I took about 25 minutes to register my EPF i-Saraan at EPF Kuching Branch in early 2019.
For the latest procedure for submitting the form, do consider calling or contacting your nearest EPF center. There might be changes due to the pandemic.
How to make an i-Saraan contribution payment?
According to the EPF website, members can make their contribution payment via the following methods:
1. Internet Banking
Through online banking at:
- MBSB Bank
- MAYBANK (M2u)
- RHB Bank
- PUBLIC BANK
- Bank Muamalat
- Alliance Bank
- Hong Leong Bank
- Bank Islam
- Cimb Bank
Please refer to the official EPF website for the updated list of participating banks.
2. Bank agent counters
Through selected bank agent counters:
- Bank Simpanan Nasional (BSN)
- Public Bank
- RHB Bank
Please refer to the official EPF website for the updated list of bank agent counters.
And please submit your contribution with a completed Form KWSP 6A(2).
3. Registered Bank Agent
Through BSN Bank Agent (Ejen Bank Berdafter (EBB) BSN) with Form KWSP 6A(2).
4. EPF counters
By cash (maximum RM500) or cheque at the EPF counter with Form KWSP 6A(2)(PDF).
Contributing to i-Saraan through online banking
My husband made his first contribution through Public Bank online.
Earlier on, the EPF officer also handed him a simple but useful step-by-step guideline on making contributions through online banking.
In case you wish to know the procedure for making a self-contribution through Public Bank online banking, the site by step is as below:
- Log in to Public Bank online banking (desktop view)
- Select Payment
- Choose Other Payment
- Then select EPF Payment from the options
- Followed by selecting Account & Payment Type (Bayaran Caruman Pilihan Sendiri or Bayaran caruman i-Saraan / i-Suri)
- At this step, make sure you choose Bayaran caruman i-Saraan / i-Suri
- Fill in details (Member’s Name, Member’s EPF No., Member’s NRIC No., Contribution Month, and Contribution Amount)
- Request PAC Now
- Confirm the transaction
Once the transaction is completed, do keep a copy of the transaction slip for future reference.
As for me, I made my EPF i-Saraan contribution through Public Bank online and Maybank2u in early 2019. I also share the step-by-step screenshot of how I made these transactions online.
You can read the details in my sharing below:
If you wish to make EPF i-Saraan payment through Public Bank or Maybank, do have a look at my sharing above.
One important thing is to remember to choose ‘i-Saraan / i-Suri‘ from the ‘Type of EPF payment’ drop-down menu.
If you accidentally select ‘Self Contribution’ or ‘Bayaran Caruman Pilihan Sendiri‘, you will not receive the matching 15% government incentive. You will need to contact EPF for correction before they can credit your EPF account with the incentive.
What is the i-Saraan contribution limit?
Even though EPF highly encourages self-employed individuals to make voluntary contributions, there is a contribution limit as per the screenshot below.
Further explanation is as below.
1. Maximum contribution of RM60,000 per year
There is a maximum payment limit of RM60,000 yearly for voluntary contribution schemes. This takes effect from January 2013.
Put in other words, a member is not allowed to contribute more than RM60,000 in a year under voluntary contribution, including EPF i-Saraan. Do take note the RM60,000 is excluding the contribution from mandatory contribution through employment.
(For those above 55 years old, your EPF contributions made between 55 to 60 years old will be parked under a separate account, Akaun Emas. And you can only make a withdrawal from Akaun Emas at 60 years old.)
2. No minimum contribution is required
As for the minimum contribution amount, there is no minimum contribution required.
Previously, there was an RM50 minimum contribution required for i-Saraan. But, effective from July 2018, the minimum contribution of RM50 has been lifted.
Since then, an i-Saraan member may contribute any amount. Provided it does not exceed RM60,000 yearly.
Read more: How to check your EPF or KWSP number?
6 Benefits of i-Saraan
Other than preparing for a better retirement, perhaps many of us are still not aware of the benefits of EPF i-Saraan.
Thus, I share the 6 benefits of i-Saraan below:
1. Eligible for government incentive
Members aged below 60 years old who made a self-contribution through the i-Saraan scheme shall receive a government contribution of 15% of the amount contributed. This government incentive is subjected to a maximum of RM250 a year.
You may refer to the screenshot from the EPF website below.
For example, if a member made his first i-Saraan contribution of RM1,000 for the year 2018, the member shall receive an RM150 contribution from the government for the year 2018.
If the same member made his first contribution of RM10,000 instead of RM1,000 for the year 2018, the member shall receive a maximum RM250 incentive from the government for the year 2018.
And if that member contributed RM1,667 for the year 2018, he shall receive the full RM250 incentive for the year 2018.
The rate of 15% took effect in January 2018 and the government contribution incentive has been extended to the year 2022.
2. Enjoy Annual EPF dividends
Savings under the i-Saraan scheme shall receive EPF annual dividend payments credited to their account up until the member reaches age 100.
As we all know, the EPF dividends for 2020 are at 5.20% for Simpanan Konvensional and 4.90% for Simpanan Shariah. And due to COVID-19, the bank fixed deposit yearly dividend for 2021 is around 1.7%.
So, you may consider contributing some of your savings to i-Saraan to enjoy a better return on investment for a bigger retirement fund.
3. Eligible for LHDN income tax relief
The third benefit would be the eligibility for income tax relief.
For the assessment year 2020, the tax relief for EPF contribution and other approved schemes is up to RM4,000.
I believe many self-employed individuals in Malaysia are not aware that they can register as EPF members and start contributing through EPF i-Saraan scheme.
Thus, they missed out on the opportunity to maximize their income tax saving through EPF contributions.
As for my husband, the tax relief is the main reason for him to contribute to the i-Saraan scheme.
4. Eligible for EPF death benefit of RM2,500
In 2019, I also contacted EPF through their website to ask whether EPF member under the i-Saraan scheme is eligible for the death benefit of RM2,500.
The answer is “Yes”, provided they fulfill the terms and conditions of EPF withdrawal.
5. Flexible EPF contribution
As stated on the EPF website, another benefit of the i-Saraan scheme is the flexibility to make contributions in terms of:
- contribution amount
- the member may make any contribution amount within his or her own financial ability.
- contribution frequency
- the member may make the contribution anytime according to his or her own timing and schedule.
The flexibility offered is a great advantage for self-employed as they can contribute according to their own financial capabilities.
6. To improve your credit score
Lastly, contributing to EPF i-Saraan may also improve your credit score.
Perhaps in the future, you may want to apply for loans such as housing loans. The regular EPF contributions which you have made throughout the years are a sign that you are a committed and responsible person. Thus, this may make the loan approval smoother.
Personally, I had come across a credit card company that uses EPF statements to support my credit card application.
So, making regular EPF contributions may help to give your credit score a boost.
When will I receive the 15% i-Saraan contribution from the government?
Based on the EPF website, the EPF team will routinely credit the government incentive to the i-Saraan account holders. The amount shall be based on the accumulated contributions made for the first and second halves of the year.
You may refer to the screenshot below.
As for me, I received the 15% i-Saraan contribution from the government for all the contributions I made in 2019.
For the contribution I made between January 2019 to June 2019, I received a 15% contribution from the government in October 2019.
The screenshot from my EPF i-Akaun is as below:
While for the contribution I made between July 2019 to December 2019, I received the 15% incentive in February 2020.
I share the print screens from my EPF i-Akaun below:
Do take note the 15% matching i-Saraan contribution from the government is under ‘Pelarasan dan caruman tertunggak‘ as shown in the above print screen.
How to register as an EPF member?
If you have been self-employed all this while, most probably you haven’t registered as an EPF member.
But, don’t worry because you can easily register as an EPF member through either one of the methods below:
1. Registration at the counter
You can register as an EPF member through the counter at your nearest EPF branch office.
Bring along your MyKad for verification purposes.
Once successful, you will receive a notice with your EPF number stated.
2. Registration through EPF kiosk
Besides registration at the counter during working hours, you also can register as an EPF member through EPF self-service kiosks.
These EPF kiosks are available at the EPF branch office nationwide. Some of these kiosks are available after working hours.
You may refer to the EPF website for a complete list of nationwide EPF kiosk locations. All you need to do is to bring along your MyKad to your nearest kiosk. Then, just follow the instruction accordingly.
Upon successful registration, the member will receive a notice with the EPF number.
With the above, I hope you have a better understanding of the i-Saraan scheme and its benefits.
If you have friends or family member who is self-employed, perhaps you can share with them on i-Saraan. This includes those who were previously under full-time employment but then had left full-time employment.
They can start their EPF i-Saraan contribution from the month they are no longer under their employment. Maybe they are not aware of this great incentive which can help them to reap many benefits as mentioned above.
Let’s help each other to secure bigger EPF savings for better retirement years.
For the most updated information on the voluntary retirement scheme, please visit the official EPF website.
Lastly, if you have any other things you wish to know about i-Saraan, please leave your comment below.