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i-Saraan (previously known as the 1Malaysia Retirement Savings Scheme or SP1M)

 
A. PURPOSE
The i-Saraan (previously known as the SP1M) is a Government initiative to ensure that those who are self-employed and do not earn a regular income achieve a certain level of savings upon reaching the retirement age. 
 
B. CONCEPT AND RATIONALE
The i-Saraan (previously known as the SP1M) aims to encourage those who are self-employed and do not earn a regular income to voluntarily contribute to the savings scheme within their means. 
 
     Rationale Behind the i-Saraan (previously known as the SP1M) : 
a) To provide an avenue for those who are self-employed and do not earn a regular income to save for the purpose of retirement. 
b) To increase the number of self-employed who save with the EPF. 
c) To demonstrate the Government's concern for the self-employed through the provision of incentives to those who save for their retirement. 
d) To reduce the number of senior citizens who are reliant on program allocations by the Society Welfare Department (JKM). 
 
C. THE SELF-EMPLOYED WHO DO NOT EARN A REGULAR INCOME
Those who fall under the self-employed category include:        
Farmers/Fishermen/Taxi Drivers
Small Business Owners/Hawkers/Night Market Traders
Babysitters
Commission-receiving agents (eg. insurance agents, real estate agents)
Freelancers (eg. those who receive payment for services including deejays, singers, actors, fitness instructors, consultants)
Business Owners (sole proprietors/partners) involved in the trading of goods and services
Online Business Owners
Professionals with their own practice (eg. accountants, doctors, lawyers)
Housewives
Pensionable Employees
 
D. ELIGIBILITY CRITERIA
a) Malaysian Citizen;
b) ‘Self-employed Persons' refer to individuals who derive income from their work and are not an employee;  
c) Registered as an EPF member; AND
d) Has opted to contribute under the i-Saraan (previously known as the SP1M) by submitting Form KWSP 16G(1M). 
 
E. MEMBERS CONTRIBUTING UNDER ‘SELF-EMPLOYED CONTRIBUTION'
Members will be required to first submit an application opting to contribute under the i-Saraan (previously known as the SP1M) using Form KWSP 16G(1M) and are subject to the terms and conditions set forth. 
 
F. SALARIED EMPLOYEES 
Salaried employees who receive regular incomes are not eligible to participate in the i-Saraan (previously known as the SP1M) and are not entitled to receive contribution from the Government. 
 
G. HOW TO APPLY
Members are required to register as a contributor of the scheme via the following methods: 
b) Fill up and submit the form over the counter or through mail. 
 
H. PAYMENT METHOD
Members may make their contribution payment via the following methods: 
a) Using KWSP 6A(2) Contribution Payment - Government Incentive (i-Saraan/i-Suri) which can be obtained from any EPF counters or from the EPF website (www.kwsp.gov.my
b) Submit KWSP 6A(2) with cash/cheque at the EPF counter/mail or appointed bank agent counter such as RHB, MBB, PBB and BSN. 
c) Internet Banking: Maybank and Public Bank 
 
I. PAYMENT LIMIT
   1. No Minimum amount (only in Ringgit); AND
   2. Maximum of RM60,000 yearly effective January 2013.
 
Note:
The accumulated maximum limit for Self Contribution, i-Saraan (previously known as the SP1M) and Top Up Savings Contribution is RM60,000 yearly.
 
J. DIVIDEND 
Savings under the scheme shall receive an annual dividend payment credited to their account up till the member reaching age 100. 
 
K. GOVERNMENT CONTRIBUTION
Members who save under the scheme shall receive Government contribution of 15% on the amount contributed, subject to a maximum of RM250 a year (New rate effective 1 January 2018). The Government contribution has been extended until 2022. 
 
This is however not applicable to members receive a fixed employer contribution (those who are employed and receive regular incomes). Government contribution is also limited to i-Saraan (previously known as the SP1M) members who are under age 55. 
 
L. CREDITING OF GOVERNMENT CONTRIBUTION TO MEMBER'S ACCOUNT
The EPF will routinely make Government contribution claims based on accumulated contribution for the first (January to June) and second (July to December) halves of the year. Upon receiving the contribution payment from the Government, the amount will be credited into members' Akaun 1 (Retirement Account).  
 
M. WITHDRAWALS
Savings under the scheme fall under EPF members' savings. Hence, members may utilise/withdraw the savings subject to the prevailing terms and conditions for EPF withdrawals.