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EPF i-Saraan: Saving As A Self-Employed Individual or Freelancer

The Employee Provident Fund (EPF) or Kumpulan Wang Simpanan Pekerja (KWSP) is Malaysia's primary retirement savings platform for salaried individuals.

However, what about those who are self-employed or working on a freelance basis? Are they left out of this critical financial safety net? The answer is no, thanks to the introduction of i-Saraan, an initiative by EPF to cater to the self-employed and those without fixed incomes.

This article delves into the i-Saraan program and how self-employed individuals or freelancers can benefit from it.

What is EPF i-Saraan?

According to EPF, ​​i-Saraan is a voluntary contribution initiative that offers an opportunity for self-employed members without fixed incomes and employees of the gig economy to obtain exclusive government incentives for retirement purposes, subject to the established requirements.

When you register for an i-Saraan account, it is pretty much the same as having a regular EPF account. You will have both Account 1 and Account 2 as well as receive the same dividends as members who are salaried employees. And just like a regular EPF account, you will not be able to withdraw the funds once you’ve deposited them into your account.

What are the benefits of i-Saraan?

Annual Dividend

Enjoy annual dividends on top of your retirement savings. For the past 10 years, the average dividend rates have been 6.035% for the conventional account and 5.43% for the Syariah account.

Special Incentive

Following government terms and conditions, the government will give an additional 15% incentive of the total contribution capped at RM300 in the current year.

According to EPF, the Special Incentive Payment will be credited into Account 1 of the Member two times namely:

a) For the period of January to June contribution, the incentive payment will be credited into the Member's Account after July;

b) For the contribution period of July to December, the incentive payment will be credited into the Member's Account after January of the following year.

Tax Exemption

Subject to Inland Revenue Board (IRB) terms and conditions.

Death Benefit

Subject to EPF terms and conditions.

What’s the difference between i-Saraan and Self-Contribution?

Both are essentially the same whereby it’s a form of voluntary contribution to EPF. However, the difference is that i-Saraan is catered specifically for those who are self-employed or freelancers whereas Self Contribution allows members who are salaried employees to contribute additional funds into their EPF account.

Who is eligible for EPF i-Saraan?

  • Farmers/Fishermen/Taxi Drivers

  • Small Business Owners/Hawkers/Night Market Traders

  • Babysitters

  • Commission-receiving agents (e.g. insurance agents, real estate agents)

  • Freelancers (e.g. those who receive payment for services including deejays, singers, actors, fitness instructors, and consultants)

  • Business Owners (sole proprietors/partners) involved in the trading of goods and services

  • Online Business Owners

  • Professionals with their own practice (e.g. accountants, doctors, lawyers)

  • Housewives

  • Pensionable Employees

How to contribute to EPF i-Saraan as a freelancer or self-employed individual?

Requirements For EPF i-Saraan

  • ​​Malaysian Citizen

  • Below 60 years of age

  • Registered EPF Member

  • Self-employed individuals​​ (who derive income from their own work and are not an employee)

  • Opted to contribute under i-Saraan

Payment Limit For EPF i-Saraan

  • Minimum: No limit (subject to payment channel).

  • Maximum: RM100,000 per year.

How To Register For EPF i-Saraan?

1. EPF Website Registration: i-Saraan Online Registration

2. EPF Counter or Self-Service Counter:

  • Visit your nearest EPF office.

  • Fill in the Borang Permohonan Caruman Sukarela i-Saraan [KWSP 16G (M)].

  • Bring your MyKad.

3. Mobile App

  • Download the KWSP i-Akaun app.

  • Register as an EPF member.

  • Register for i-Saraan through the app.

How To Deposit Funds Into EPF i-Saraan?

  1. KWSP i-Akaun mobile app

  2. Internet banking

  3. BSN (registered bank agent) via electronic payment or cash

  4. Bank agent counters (BSN, Maybank, Public Bank, RHB Bank)

  5. EPF Counters

  6. Mobile Team/Mini Outreach Team

FAQ About EPF i-Saraan

1. Can I request a refund of my i-Saraan Contribution?

You can't do that at all. Each and every amount of i-Saraan Contribution paid into EPF is valid and final. As a result, members are obligated to check that the payment details are accurate before completing the transaction.

2. Is it allowed for me to contribute more than the maximum amount?

No, you can't do it. Contributions that exceed the maximum limit will be refunded to members.

3. What happens if I make an i-Saraan Contribution payment after the age of 55?

All contributions received after the member reaches the age of 55 are deposited into Akaun Emas and can only be withdrawn after the member reaches the age of 60.

Why is it important for you to start saving for your retirement?

For freelancers and self-employed individuals, the journey to financial stability can often be challenging, with income streams that might fluctuate and lack the conventional safety nets provided to salaried employees.

Saving for retirement is paramount, ensuring you can maintain a comfortable lifestyle even when regular income ceases. The introduction of EPF's i-Saraan offers a beacon of hope. Not only does it provide a structured way to save, but it also offers a slew of benefits all aimed at magnifying your retirement savings.

Initiatives like these underscore the importance of starting early and leveraging available resources to secure a financially stable future, regardless of your employment status. In a world where the gig economy and freelance work are becoming increasingly prevalent, tools like i-Saraan are not just helpful; they're essential.

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