What is the Singapore's Central Provident Fund (CPF)?

The Central Provident Fund (CPF) is a social security saving plan that covers health care, retirement and home ownership.

The contribution rate varies depending on the age, the wage band and the status of the employee (i.e. Singaporean citizen or PR). The maximum amount of CPF contribution payable is based on a monthly salary ceiling of $6,000. Voluntary contributions can be paid in addition to the mandatory contributions.

The employee’s share of CPF contribution is deducted from their salary by the employer during the monthly payroll processing. The employer is then required to pay the employer’s and employee’s share of CPF contributions monthly for all employees (Singapore citizens and Singapore PRs) at the rates set out in the CPF Act. The contributions payable should be based on the employee’s actual wages earned for the month.

CPF contributions are not allowed for:

  • Foreigners working in Singapore under an EP, S Pass or a Work Permit; and
  • Directors’ fees

How is Central Provident Fund contribution calculated?

For the purpose of CPF, wages are classified into 2 categories.

Ordinary Wages

Ordinary Wages (OW) refers to the basic salary earned in the month. CPF contribution on OW is capped at $6,000 a month.

Additional Wages

Additional Wages (AW) refers to bonuses and other variable components earned. CPF contribution on AW is capped based on the following computation:

AW subject to CPF = Total Wages – OW subject to CPF

Total wages is capped at $6,000 x 17 months = $102,000 a year

For example, an employee earning $8,000 a month with an annual bonus of $50,000 will contribute CPF based on the following capping:

OW: CPF will be contributed based on the cap of $6,000 on a monthly basis.

AW: AW subject to CPF =$102,000* – OW subject to CPF for the year

                                         = $102,000 – ($6,000 x 12 months)

                                         = $ 30,000 

CPF will be contributed based on the cap of $30,000.

*Equivalent to 17 months x $6,000

Changes to CPF contribution rates from January 2016

i. Increase in employer/self-employed contribution rate - Medisave Account (MA)

With effect from 1 January 2016, the employer contribution rates to the SA account have been increased by 1% for employees aged between 51 and 60, and by 0.5% for employees aged between 61 and 65. 

ii. Increase in employee contribution rate - Ordinary Account (OA)

With effect from 1 January 2016, the employer contribution rates to the SA account have been increased by 1% for employees aged between 51 and 60, and by 0.5% for employees aged between 61 and 65.

iii. Increase in employer contribution rate - Special Account (SA)

With effect from 1 January 2016, the employee contribution rate for employees aged 51 to 55 have been increased by 1%.

The tables below show these increases in CPF contribution rates for Singapore Citizens (SC), Singapore Permanent Residents (SPR) from their third year of obtaining SPR status and Self-Employed Persons (SEP).

Table 1.1 - Increase in CPF contribution rates for SCs and SPRs in private sector and public sector non-pensionable employees from January 2016

The following rates are applicable for:

  • Singapore citizen
  • PR from the third year onwards of obtaining SPR status
  • PR who has jointly applied with employer to contribute at full rates in the 1st two years of obtaining the SPR status 

Employee’s age (years)

Contribution Rates from 1 January 2016 (for monthly wages ≥ $750)

By Employer (% of wage)

By Employee (% of wage)

Total (% of wage)

55 and below




Above 55 to 60




Above 60 to 65




Above 65




Source: CPF Board

*Please refer to the CPF website for the phased-in rates.

 Special Employment Credit (SEC) until 2019

The SEC scheme encourages employers to re-employ older low-wage Singaporeans through the provision of wage-offsets. As part of continued efforts to raise the employment rate of older workers, SEC will be extended till 31 December 2019 with the following key changes:

  1. Qualifying age of 55
  2. Age-tiered payments of up to 3%, 5% and 8% of wages for those aged 55-59, 60-64 and 65 and above respectively
  3. Wage-offset of up to 16% of wages for employers hiring Persons with Disabilities (PWDs) aged 13 and above. There will be no tiering of wage-offsets by age band for eligible PWDs

The changes are applicable to Assessment Year 2017 to 2019.

For more information on the SEC scheme, please visit the Special Employment Credit website .

Table 1.2 - Medisave contribution rates applicable to SEPs

Annual net trade income (from 2016)

Age as of 1 January of work year

Below 35 years

35 to below 45 years

45 to below 50 years

50 years and above

Above $6,000 to $12,000





Above $12,000 to $18,000

Phased in* from 4% to 8%

Phased in* from 4.5% to 9%

Phased in* from 5% to 10%

Phased in* from 5.25% to 10%

Above $18,000


(Maximum $5,760)


(Maximum $6,480)


(Maximum $7,200)


(Maximum $7,560

Source: CPF Board

*Please refer to the CPF website for the phased-in rates.


Effective 1stApril 2019, core provisions of the Employment Act will cover all employees. Prior to this, Managers and Executives earning up to $4,500 were excluded from these core provisions. With this change, all employees are now entitled to paid annual leave, paid public holidays and sick leave.


Previously, non-workmen earning up to $2,500 a month were entitled to overtime pay but the overtime rate was capped at $2,250 a month. Effective 1stApril 2019, non-workmen earning up to $2,600 will be entitled to overtime pay and the rate used to calculate overtime pay will be increased to a cap of $2,600 a month.

In addition, the increase from $2,500 to $2,600 will see more employees covered under Part IV provisions of the Employment Act. This section of the Act provides for hours of work, rest day and overtime payments to eligible employees. Managers and executives continue to be excluded from Part IV provisions. 

Mazars can help you manage your payroll

Companies must be registered with the CPF board before mandatory contributions are made. Mazars can help you with the registration along with other payroll services that will save time for your business. Find out more information about our Payroll Outsourcing services .

Want to know more?