The Central Provident Fund (CPF) is one of the most important components of Singapore's employment system. Understanding CPF contributions helps employees estimate take-home salary while helping employers calculate payroll costs accurately.
The Central Provident Fund (CPF) is Singapore's mandatory social security savings scheme. CPF contributions support retirement, healthcare, housing and long-term financial security.
Both employers and employees contribute to CPF on a monthly basis, with contribution rates varying according to age and residency status.
| Contributor | Contribution Rate |
|---|---|
| Employee | 20% |
| Employer | 17% |
| Total CPF Contribution | 37% |
Employees above age 55 may be subject to different CPF contribution rates according to CPF Board guidelines.
Suppose an employee earns a gross monthly salary of SGD 4,000.
Although the employee receives SGD 3,200 in cash salary, an additional SGD 1,480 is credited into CPF accounts for future retirement, housing and healthcare needs.
CPF contributions are subject to wage ceilings set by the CPF Board. Employees earning above the applicable ceiling will only contribute CPF up to the capped salary amount.
The CPF Board periodically adjusts wage ceilings to reflect economic conditions and wage growth in Singapore.
Foreign employees holding Employment Passes, S Passes or Work Permits generally do not contribute CPF.
CPF plays a significant role in:
Yes. Employee CPF contributions are deducted from gross monthly salary before salary is paid.
Yes. Employer CPF contributions are paid in addition to employee salary and are not deducted from wages.
Generally no. Most foreign workers under Employment Passes, S Passes and Work Permits are not required to contribute CPF.
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