SOCSO for the Self-Employed in Malaysia: the SKSPS Scheme (Act 789)

A different Act, not a cheaper version of the same scheme

Employees are covered by the Employees' Social Security Act 1969 (Act 4), which gives them two schemes — Employment Injury and Invalidity — plus EIS under a third Act. The self-employed are covered by the Self-Employment Social Security Act 2017 (Act 789), and Act 789 contains one scheme only: Self-Employment Injury.

That single difference drives everything else. SKSPS is work-accident insurance, not a social safety net. There is no invalidity pension if you become unable to work for reasons unconnected to an accident at work, and there is no EIS — so no Job Search Allowance if your income dries up, because you were never an employee who could be retrenched.

Who has to contribute

Coverage was rolled out by sector rather than all at once. It began in June 2017 with passenger transport — taxi, e-hailing and bus drivers — and has since been extended until it covers essentially every self-employed activity, from agriculture, fishing and livestock to construction, F&B, retail, online selling, professional services and the creative sector.

For most sectors registration is mandatory in law but not policed at the point of entry, so compliance is patchy. Passenger transport is the exception: e-hailing and taxi drivers are asked to show proof of an active SKSPS contribution when renewing their licence or vocational permit, which is why drivers are by far the largest group in the scheme.

• You are self-employed for this purpose if you work for your own gain and are not on anyone's payroll — sole proprietors, freelancers, drivers, riders, hawkers, smallholders, online sellers.
• If you are an employee who also drives part-time, the two are separate: your employer's Act 4 contribution does not cover you while you are driving, because that activity is not part of your employment.
• Registering a Sdn Bhd and paying yourself a salary makes you an employee of your own company — you then contribute under Act 4, not SKSPS.
• Platform gig work has been moving toward mandatory contributions with a share paid by the platform rather than the worker. If you ride or drive for a platform, check the current position with PERKESO or your platform before assuming you are covered.

The contribution plans

You do not contribute a percentage of what you actually earn — you choose an insured monthly earning from a fixed table, and the contribution is 1.25% of it. Contributions are usually paid annually as a lump sum, so the yearly figure is the one that matters:

• The plan sets your benefit level, not just your cost. Temporary and permanent disablement benefits are calculated from the insured earning you chose, so Plan 1 costs RM157.20 a year and pays out accordingly.
• Pick the plan closest to what you genuinely earn. A driver netting RM3,000 a month who insures on Plan 1 has bought roughly a third of the income replacement they would need.
• Cover runs for 12 months from the date the contribution is received — it is a rolling policy, not a calendar year. Miss the renewal and you are uninsured from that day, with no grace period.

What SKSPS pays for

The benefits mirror the employee Employment Injury Scheme fairly closely:

• Medical benefit — treatment at government hospitals and PERKESO panel clinics for the injury.
• Temporary Disablement Benefit — a daily payment while a doctor certifies you unfit to work, subject to a minimum certified period.
• Permanent Disablement Benefit — a pension or lump sum where the injury leaves lasting impairment, graded by percentage.
• Constant-Attendance Allowance — for total permanent disablement requiring personal care.
• Dependants' Benefit and Funeral Benefit — where a self-employment injury is fatal.
• Education Benefit for children, plus physical and vocational rehabilitation to get you back to work.

The claim test that catches people out

A claim only succeeds if the injury arose out of and in the course of the registered self-employment activity. That includes travel directly connected with the work, but it draws a hard line that employees never have to think about, because an employee's commute is covered and a self-employed person's private driving is not.

The practical consequence for an e-hailing driver: an accident with a passenger in the car, or while travelling to a booking, is a self-employment injury. The same accident on the way to a family dinner with the app switched off is not. Keep the trip record — the platform's job history is the evidence that decides the claim.

SKSPS is also not health insurance. An illness unrelated to the work, a chronic condition, or hospitalisation for anything other than a self-employment injury falls outside it entirely.

Registering, paying and the tax relief

Registration and payment are done through PERKESO's online portal, at a PERKESO office, or over the counter at appointed agents and banks; drivers commonly renew at the same time as their vocational licence. You will need your identity card details, the sector you work in and the plan you are choosing.

Contributions to SKSPS qualify for the same personal income tax relief as employee SOCSO — capped at RM350 a year, shared with EIS. Since the top plan costs RM592.80 a year, the relief covers part but not all of it. Claim it in the Form B as a relief; it is not a business expense of the trade.

• Keep the contribution receipt. It is both your proof of cover for a claim and your supporting document for the RM350 relief.
• SKSPS is social security only — it does nothing for your retirement. EPF's i-Saraan scheme is the separate, voluntary counterpart, and pays a government matching incentive with its own relief slot.
• Running SKSPS and i-Saraan together is the closest a self-employed Malaysian gets to the statutory package an employee receives automatically.

Important caveats

This is a general explanation, not advice on a specific claim. Contribution plans, insured earnings, benefit rates, the sectors covered and the treatment of platform gig workers are all set by law and revised from time to time — and the rules for gig work in particular have been changing. Confirm the current plan table and your own coverage position with PERKESO at perkeso.gov.my before relying on any figure here.

The calculator on this page computes employee SOCSO and EIS under Act 4. It does not model SKSPS, because SKSPS contributions come from a fixed plan you choose rather than from your earnings.