MPF Offset Calculator (HK)
Updated November 2026 · Free · No sign-up
Calculate the MPF offset transition — since 1 May 2025 employers cannot offset severance/long-service payments against mandatory MPF for POST-transition service; this splits long-tenure exits into two eras with different math.
Quick answer: The split: pre-1-May-2025 service → LSP/SP computed on the LAST wages before transition (or final wages for pre-transition-only formulas — grandfathered and still offsettable against employer MPF); post-transition service → computed on final wages, no offset. Your exit payment is the sum of both portions.
How the Transition Splits the Money
| Pre-transition portion | Post-transition portion | |
|---|---|---|
| Service counted | Years before 1 May 2025 | Years from 1 May 2025 |
| Wage basis | Wages immediately before the transition date (frozen snapshot) | Final wages at termination |
| MPF offset? | Still allowed (employer contributions + returns) | Abolished |
Both portions use the standard 2/3 formula with the $22,500 wage cap, and the combined total still respects the $390,000 ceiling. The frozen pre-transition wage snapshot means raises AFTER May 2025 don’t inflate the grandfathered portion — the design’s cost-containment trick.
Worked Example
6 pre-years at $25,000 + 2 post-years at $30,000 (capped $22,500 both): pre portion 6 × $15,000 = $90,000 (offsettable against the employer-MPF pot); post portion 2 × $15,000 = $30,000 untouchable. With $80,000 of employer MPF: the pre-portion offsets fully from it → cash paid = $10,000 pre + $30,000 post = $40,000 (and the offset $80,000 stays spent from the MPF pot’s employer side).
Why This Matters Now
Every HK exit from 2025 onward is a two-era computation — payroll systems, severance negotiations, and your own checking math must hold both wage snapshots. Employers got a 25-year subsidy scheme to cushion the abolition; employees got the principle that retirement savings stop funding their own severance. Base formulas: the LSP/SP page.
Frequently Asked Questions
What was the MPF offset?
Employers could claw back severance/long-service payments from their own MPF contributions (and returns) in the employee’s account — abolished for service from 1 May 2025.
How is service split?
Pre-1-May-2025 years compute on the wages immediately before that date (frozen) and remain offsettable; post-transition years compute on final wages with no offset.
Do post-2025 raises increase my pre-portion?
No — the pre-transition portion’s wage snapshot froze at 30 April 2025; raises only lift the post-portion.
Does the $390,000 cap still apply?
Yes — to the combined total across both portions.
Can employers still offset against voluntary contributions?
Employer VOLUNTARY contributions and gratuities retain offset mechanics — the abolition targeted mandatory contributions for post-transition service.
✓ Formula verified • Last updated: November 3, 2026