Malaysia
Worked in Malaysia? Any pension you built up here is yours to keep and can usually be paid to you abroad — but you have to claim it; it won't start automatically. The full state pension age is 60, with early access from 55. On totalization, your Malaysia contributions generally stand on their own. Below is Malaysia's system at a glance and what expats should check.
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Overview
Malaysia operates a multi-pillar, predominantly defined contribution (DC) retirement system with no universal pay-as-you-go state pension.
The primary vehicle for private-sector workers is the Employees Provident Fund (EPF/KWSP), established in 1951, which is a mandatory DC provident fund covering all Malaysian citizens and permanent residents in employment. As of September 2025, total EPF membership exceeded 16.5 million, with 9.07 million active members representing 51.7% of the labour force. The EPF declared a 6.30% dividend for FY2024 (total payout RM73.24 billion) and 6.15% for FY2025 (total payout RM79.6 billion). A landmark reform effective 1 October 2025 extended mandatory EPF contributions to all non-Malaysian citizen employees holding valid work passes (excluding domestic workers), at 2% each from employer and employee. From 1 January 2026, EPF introduced the Retirement Income Adequacy (RIA) Framework with three savings tiers: Basic Savings (RM390,000), Adequate Savings (RM650,000), and Enhanced Savings (RM1.3 million), replacing the old RM240,000-by-age-55 benchmark. The three-account structure (Akaun Persaraan 75%, Akaun Sejahtera 15%, Akaun Fleksibel 10%), introduced in May 2024, remains in place.
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Public sector civil servants with pensionable status are covered by a separate defined benefit pension scheme administered by KWAP (Retirement Fund Incorporated), while military personnel are covered by LTAT (Armed Forces Fund Board), which declared a 5.35% dividend for FY2025 — its highest payout in eight years. A voluntary supplementary layer exists through the Private Retirement Scheme (PRS), regulated by the Securities Commission Malaysia and administered by the Private Pension Administrator (PPA), offering tax relief of up to RM3,000/year until Year of Assessment 2030. SOCSO (PERKESO) provides social insurance for employment injury and invalidity (wage ceiling RM6,000/month since October 2024), and the Employment Insurance System (EIS) provides unemployment protection. Social assistance for elderly poor is provided through the Department of Social Welfare (Jabatan Kebajikan Masyarakat).
Malaysia's pension system faces significant adequacy challenges. The OECD (Pensions at a Glance Asia/Pacific 2024) places Malaysia's gross replacement rate below 40% for average earners — among the lowest in Asia. New civil service recruits from 1 February 2024 onwards are placed on EPF rather than the traditional KWAP defined benefit pension scheme, marking a major structural reform. The federal government's public pension bill reached approximately RM42.8 billion in 2026, with KWAP contributing RM5 billion (11.7%) of that obligation. The World Bank has recommended raising the EPF withdrawal age to align with the statutory retirement age of 60, but no such change has been legislated as of mid-2026.
Below 40% (OECD Pensions at a Glance Asia/Pacific 2024 — average earner, mandatory schemes only)
Zero Pillar: Non-contributory social assistance for elderly poor via Department of Social Welfare (Bantuan Warga Emas). First Pillar (Mandatory): EPF/KWSP for private sector and non-pensionable public sector employees (including mandatory coverage for non-Malaysian citizen employees from October 2025); KWAP defined benefit pension for pensionable civil servants hired before 1 February 2024; LTAT hybrid DC/DB for military personnel; SOCSO for employment injury and invalidity insurance. Second Pillar (Voluntary): Private Retirement Scheme (PRS) — voluntary DC scheme open to all individuals aged 18+, regulated by Securities Commission Malaysia. Third Pillar: Employer-provided supplementary schemes and personal savings. No universal PAYG state pension exists.
Defined Contribution (DC) — Provident Fund model for private sector; Defined Benefit (DB) for existing pensionable civil servants; Mixed DC/DB hybrid for military (LTAT)
Employee
11% of monthly wages (Malaysian citizens/PRs under age 60); 0% at age 60+; 2% for non-Malaysian citizen employees (mandatory from October 2025, for those under 75 with valid work pass)
Employer
13% for employees earning ≤RM5,000/month; 12% for employees earning >RM5,000/month (for Malaysian/PR employees under 60); 4% for employees aged 60–75; 2% for non-Malaysian citizen employees (mandatory from October 2025)
Self-Employed
Voluntary — up to RM100,000 per year (no mandatory rate for self-employed; i-Saraan and i-Saraan Plus available for gig workers with government matching incentives)
Notes
Total mandatory EPF contribution for Malaysian citizen earning ≤RM5,000/month: 24% of salary (11% employee + 13% employer). For earnings >RM5,000/month: 23% (11% + 12%). Contributions must be remitted by the 15th of the following month. For salaries up to RM20,000/month, contribution amounts are determined by the Third Schedule of the EPF Act 1991 (fixed table amounts, not exact percentages); exact percentage calculation only applies for salaries exceeding RM20,000/month. Minimum EPF membership age: 14; maximum contribution age: 75. SOCSO wage ceiling: RM6,000/month (effective October 2024; transition period ended March 2025). EIS: 0.2% each from employer and employee (capped at RM6,000 wage ceiling; foreign workers and employees aged 60+ excluded). KWAP: employer-only contribution of 17.5% of basic salary for statutory bodies/local authorities with pensionable employees. LTAT: 10% employee + 15% government employer for compulsory military contributors. For YA2025: EPF contributions qualify for tax relief up to RM4,000/year (mandatory contributions); additional voluntary EPF or life insurance premiums qualify for a separate RM3,000 relief (total up to RM7,000 combined for EPF and life insurance); PRS contributions qualify for a further separate RM3,000 relief until YA2030.
Common questions
What is the retirement age in Malaysia?
The full state pension age in Malaysia is 60. Early retirement may be possible from 55. Deferring can raise your pension up to age 75.
Can I claim a Malaysia pension if I live abroad?
Yes. A pension you've earned in Malaysia stays yours wherever you retire, and can usually be paid into an overseas account once you reach pension age. It won't start automatically, though — you need to claim it, typically a few months in advance, through Malaysia's pension authority.
Do totalization agreements affect my Malaysia pension?
Our records show Malaysia has limited or no bilateral totalization agreements, so your Malaysia contributions generally can't be combined with other countries' to qualify. Confirm the latest position with the official authority.
How is the pension system structured in Malaysia?
Defined Contribution (DC) — Provident Fund model for private sector; Defined Benefit (DB) for existing pensionable civil servants; Mixed DC/DB hybrid for military (LTAT) Zero Pillar: Non-contributory social assistance for elderly poor via Department of Social Welfare (Bantuan Warga Emas). First Pillar (Mandatory): EPF/KWSP for private sector and non-pensionable public sector employees (including mandatory coverage for non-Malaysian citizen employees from October 2025); KWAP defined benefit pension for pensionable civil servants hired before 1 February 2024; LTAT hybrid DC/DB for military personnel; SOCSO for employment injury and invalidity insurance. Second Pillar (Voluntary): Private Retirement Scheme (PRS) — voluntary DC scheme open to all individuals aged 18+, regulated by Securities Commission Malaysia. Third Pillar: Employer-provided supplementary schemes and personal savings. No universal PAYG state pension exists. It includes 5 schemes in our directory.
How do I get a copy of my Malaysia pension record?
Ask EPF i-Akaun for your Penyata KWSP (EPF statement) (the EPF account statement). It's free and you can request it yourself — our step-by-step guide on this page walks through the portal, what to have ready, and what to do if the login fails.