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Message: <blockquote data-quote="Traveler" data-source="post: 320866" data-attributes="member: 7248">There is a maximum amount of EPF contributions that is tax deductible.IIRC, the maximum amount for  EPF employee contributions + life insurance premiums is RM6,000. So if your combined EPF employee contribution + life insurance premiums are over RM6,000 with the 8% rate, then it makes no difference to your taxes (since you've already maxed out your deductions). Your taxes will be impacted only if the combined amount is less than RM6,000.Thus I would say for the high income group, it makes no difference, but for the middle income group (combined EPF/life insurance is over RM6,000), then you will be paying more in taxes.On a side note, tax issues aside, I prefer the 8% deduction over the 11% as I feel I can put the 3% difference to better use than EPF can. EPF's investments aren't very high yielding (mostly safe and low-yielding government bonds, followed by corporate bonds and finally equities), and I don't expect this year or next year's dividends to be spectacular given the current market situation. Even in recent years, it's been around the 4-5% range. Now if I have a higher returning investment or if I am paying down debt (housing mortage, etc.) with a interest rate higher than EPF's dividend rate, then I am better off taking that 3% and using it to pay down my debt instead of leaving it with EPF (+4% EPF dividend -6% housing loan = -2% negative carry).In short, I'll take the 8% <img src="data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7" class="smilie smilie--sprite smilie--sprite1" alt=":)" title="Smile    :)" loading="lazy" data-shortname=":)" /></blockquote>

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