Moving from Hong Kong to Singapore? This is how it affects your Mandatory Provident Fund

It seems like 2022 has seen a huge increase in Hong Kong expats packing up their bags and relocating to Singapore. The number has surged since the start of the pandemic and continues to grow. For many, Singapore represents an appealing alternative to Hong Kong, similar in stature, safe, and secure. 

But moving countries can be a daunting and overwhelming process. Questions like where to live, what school to send your kids to, or just how to adjust to life in a 24/7 365-day year tropical climate are at the front of your mind. Financial matters on top of that can cause added and much-unneeded stress. 

One such complication when moving from Hong Kong to Singapore is your Mandatory Provident Fund (MPF). Should you withdraw or leave it, and what should you do with it if you do withdraw it? There is the option to leave it in Hong Kong and access it at 65 years old as usual, but this isn't the right thing to do for everyone. It's important to think about it and take the right steps to properly prepare and know how to handle the MPF withdrawal process. 

Withdrawing your MPF 

To withdraw your MPF, you'll need to provide your employer in Hong Kong with an MPF Withdrawal Form. This form can be downloaded from the MPFA website [mpfa.org.hk]. The form must be completed and signed by both you and your employer. You'll also need to provide proof of identity and make a statutory declaration with proof of address to prove that you have left. 

Tax implications should also be taken into account when withdrawing your MPF. These differ depending on where you are. In Singapore, these would remain tax-free, but they would need to be dealt with differently in Australia or the UK. The levels and bases of taxation and reliefs from taxation are also subject to change at any time, so it is vital to seek independent tax advice from suitably qualified professionals before deciding what to do with your MPF. 

Then there is the question of what to actually do with your MPF. If you're relocating to Singapore, a simple option would be to transfer your MPF fund to a local Singaporean bank account. But there are other investment options that you could look at that may be a better fit. 

Benefits of withdrawing your MPF 

Withdrawing your MPF can give you more control over your finances. It removes currency risk on the HKD and, importantly, protects you against any future legislation changes in Hong Kong. You also have more opportunities to choose how to manage the investment outside of the fund. 

Whatever your decision, it's essential to seek independent advice from professionals who can help you make the best decision before withdrawing your MPF. 

Planning for financial freedom 

Moving countries is never easy, but financial planning can help you build towards a happy and stress free life in Singapore. Dealing with your MPF upon leaving Hong Kong is just one aspect of this. There are many other financial factors to consider when making the move, such as insurance, investing, tax and saving for retirement. Singapore also has it's own Central Provident Fund called (CPF), which can be a consideration for permanent residents. 

The team at Eight Wealth International can provide you with independent and unbiased advice on all aspects of financial planning, whether you're moving from Hong Kong to Singapore or from somewhere else. We can help you plan and prepare for a smooth transition and advise on how to position yourself financially, so that you can focus on enjoying your new life.  

Get in touch today to find out more about how we can help you. 

The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances. You are advised to seek independent tax advice from suitably qualified professionals before making any decision as to the tax implications of any investment.

Eight Wealth International is a Principal Partner Practice of St. James’s Place (Singapore) Private Limited and St. James’s Place (Shanghai) Limited. The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives. Members of the St. James’s Place Partnership in Singapore represent St. James’s Place (Singapore) Private Limited, which is part of the St. James’s Place Wealth Management Group, and it is regulated by the Monetary Authority of Singapore and is a member of the Investment Management Association of Singapore and Association of Financial Advisers (Singapore).

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