Have you ever thought about how CPF contributions affect your payroll costs and workforce planning? For Singapore employers, CPF is more than compliance, and it also shapes employee trust and retention.
Singapore is projected to become a “super aged” society by 2026, with over 20% of the population aged 65 or older. That shift makes it even more important to manage CPF contributions accurately and consistently as your workforce needs evolve.
In this guide, we’ll explain what CPF contributions are, who must contribute, how rates and caps work, and the common mistakes employers should avoid so your process stays clean and predictable.
Key Takeaways
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What is the Meaning of CPF?
CPF is Singapore’s mandatory savings scheme where employers and employees contribute a portion of wages, which later supports monthly payouts in retirement. A CPF employer is an employer required to make these contributions for eligible employees in Singapore.
CPF isn’t just a retirement fund. It also supports housing and healthcare needs, so consistent contributions help employees build long-term financial security.
CPF Key Accounts & Requirements
The CPF Singapore system is structured into four key accounts:
- Ordinary Account (OA): Primarily used for retirement savings, housing, insurance, and investments.
- MediSave Account (MA): Designed to cover medical expenses and approved health insurance needs.
- Special Account (SA): Focuses on long-term retirement savings and investments related to retirement.
- Retirement Account (RA): Activated at age 55, this account is dedicated to providing monthly retirement payouts.
As an employer, you pay both your share and your employee’s share of CPF contributions each month, including variable pay like performance-based incentives in payroll when applicable. While CPF is due by month-end, you typically have until the 14th of the following month to complete payment.
CPF is compulsory for Singapore Citizens and PRs earning more than SGD 50 a month. Beyond meeting the requirement, CPF supports employees across life stages, from healthcare needs to retirement, and keeping the process organized helps payroll run smoothly.
What are the Recent Updates on CPF Employers?
Starting 1 January 2025, CPF contribution rates for employees aged 55 to 65 will rise by a total of 1.5 percentage points. The increase is split between employers (0.5%) and employees (1%), so payroll costs and take-home pay will shift slightly for this age group.
To ease the added employer cost, the CPF Transition Offset (CTO) will be extended for another year. Also from January 2025, the Special Account (SA) for members aged 55 and above will be closed, with balances moved to the Retirement Account (RA) up to the Full Retirement Sum (FRS), and any remaining funds transferred to the Ordinary Account (OA). The Enhanced Retirement Sum (ERS) cap will also increase from 3x to 4x the Basic Retirement Sum (BRS), supporting higher potential monthly payouts.
The Matched Retirement Savings Scheme (MRSS) will continue beyond the pilot with higher matching grants and no age cap, but tax relief for cash top-ups that receive MRSS matching will no longer apply. The Home Protection Scheme (HPS) will also expand to cover more members, so employers should review payroll settings and employee comms to stay aligned with the updates.
What Will be the CPF Employer Contribution Rate for 2025?
The monthly CPF Ordinary Wage maximum has increased twice since this increment was put into effect: on September 1st, 2023, it went up from SGD6,000 to SGD6,300, and on January 1st, 2024, it went up to SGD6,800.
The CPF Ordinary Wage cap will increase to SGD7,400 per month on January 1st, 2025. However, the CPF annual salary cap, which includes both Ordinary Wages and Additional Wages, is still set at SGD 102,000.
Additionally, the existing CPF Annual Limit and Additional Wage ceiling will not be altered; they will stay at SGD 37,740 and SGD 102,000, respectively. Here is a summary of the 2025 CPF contribution rate tables to help you understand the new changes:
For Workers Making More Than SGD 750 Per Month
| Age Group of Employees (Years) | CPF Contributions from Employers | CPF Contributions from Employees |
|---|---|---|
| Below 55 | 17% | 20% |
| 55 – 60 | 15.5% | 17% |
| 60 – 65 | 12% | 11.5% |
| 65 – 70 | 9% | 7.5% |
| Above 70 | 7.5% | 5% |
The CPF contribution rates also differ based on various categories. For example, Singapore Citizens or Singapore Permanent Residents (SPR) who have worked in the country for three years or more are subject to standard contribution rates.
However, for first-year SPRs working part-time, different CPF contribution rates apply. Similarly, second-year SPRs working part-time will have their own set of rates. The CPF contribution rates for first-year SPRs employed full-time differ from those for second-year SPRs in full-time roles as well.
These distinctions ensure that CPF rate contributions are aligned with each employee’s specific work and residency status.
What Will Happen to Singaporeans and Singapore Permanent Residents in Third Year Onwards?
For Singaporean workers and SPR who have been employed in the nation for three years or longer, this category represents the percentage of CPF payments made by employers and employees.
| Age Group of Employees (Years) | Total Pay for Employees | CPF Contributions from Employers | CPF Contributions from Employees |
|---|---|---|---|
| Below 55 | SGD 50 – SGD 500 | 17% | – |
| SGD 500 – SGD 750 | 17% | 0.6 (TW – SGD 500) | |
| SGD 750 & Above | 17% (Max. of SGD 1,250) | 20% (Max. of SGD 1,250) | |
| 55 – 60 | SGD 50 – SGD 500 | 15.5% | – |
| SGD 500 – SGD 750 | 15.5% | 0.51 (TW – SGD 500) | |
| SGD 750 & above | 15.5% (Max. of SGD 1,147) | 17% (Max. of SGD 1,258) | |
| 60 – 65 | SGD 50 – SGD 500 | – | – |
| SGD 500 – SGD 750 | 0.345 (TW – $500) | 0.345 (TW – $500) | |
| SGD 750 & above | 12% (Max. of SGD 888) | 11.5% (Max. of SGD 851) | |
| 65 – 70 | SGD 50 – SGD 500 | 9% | – |
| SGD 500 – SGD 750 | 9% | 0.225 (TW – $500) | |
| SGD 750 & above | 9% (Max. of SGD 666) | 7.5% (Max. of SGD 555) | |
| Above 70 | SGD 50 – SGD 500 | 7.5% | – |
| SGD 500 – SGD 750 | 7.5% | 0.15 (TW – $500) | |
| SGD 750 & above | 7.5% (Max. of SGD 555) | 5% (Max. of SGD 370) |
What Will be the First year of SPR Status Undergraduate?
This category applies to employees who have held their full Singapore Permanent Resident (SPR) status for at least one year and are employed by non-full-time employers, such as part-time or casual roles. CPF is then calculated based on wages, like prorated salary for part-time SPR employees, so the contribution rates follow the non-full-time tier for both employer and employee.
| Age Group of Employees (Years) | Total Pay for Employees | CPF Contributions from Employers | CPF Contributions from Employees |
|---|---|---|---|
| Below 55 | SGD 50 – SGD 500 | 4% | – |
| SGD 500 – SGD 750 | 4% | 0.15 (TW – $500) | |
| SGD 750 & Above | 4% | 5% (Max. of SGD 370) | |
| 55 – 60 | SGD 50 – SGD 500 | 4% | – |
| SGD 500 – SGD 750 | 4% | 0.15 (TW – $500) | |
| SGD 750 & above | 4% (Max. of SGD 296) | 5% (Max. of SGD 370) | |
| 60 – 65 | SGD 50 – SGD 500 | 3.5% | – |
| SGD 500 – SGD 750 | 3.5% | 0.15 (TW – $500) | |
| SGD 750 & above | 3.5% (Max. of SGD 296) | 5% (Max. of SGD 370) | |
| 65 – 70 | SGD 50 – SGD 500 | 3.5% | – |
| SGD 500 – SGD 750 | 3.5% | 0.15 (TW – $500) | |
| SGD 750 & above | 3.5% (Max. of SGD 259) | 5% (Max. of SGD 370) |
What Will be the Second Year of SPR Status Undergraduate?
The CPF employers and employees’ contributions who have been fully covered by SPR for two years and who work for non-full-time employers, which include part-time or casual workers, fall under this group.
| Age Group | Total Wage (SGD) | Employer Contribution Rate | Employee Contribution Rate |
|---|---|---|---|
| Below 55 | SGD 50 – SGD 500 | 7.5% | 5% |
| SGD 500 – SGD 750 | 13% | 12.5% | |
| SGD 750 & Above | 17% | 20% | |
| 55 – 60 | SGD 50 – SGD 500 | 4% | 5% |
| SGD 500 – SGD 750 | 9% | 12.5% | |
| SGD 750 & Above | 13% | 12.5% | |
| 60 – 65 | SGD 50 – SGD 500 | 3.5% | 3.75% |
| SGD 500 – SGD 750 | 6% | 7.5% | |
| SGD 750 & Above | 8.5% | 7.5% | |
| 65 – 70 | SGD 50 – SGD 500 | 3.5% | 3.75% |
| SGD 500 – SGD 750 | 6% | 5% | |
| SGD 750 & Above | 6% | 5% | |
| Above 70 | SGD 50 – SGD 500 | 3.5% | 3.75% |
| SGD 500 – SGD 750 | 6% | 5% | |
| SGD 750 & Above | 6% | 5% |
Second Year of SPR Status Under Full Employer & Graduated Employee
Contributions from employers and workers who have been employed by full employers and have had full SPR status for two years fall under this group. This indicates that their companies have made them full-time employees.
| Age Group of Employees (Years) | Total Pay for Employees | CPF Contributions from Employers | CPF Contributions from Employees |
|---|---|---|---|
| Below 55 | SGD 50 – SGD 500 | 17% | – |
| SGD 500 – SGD 750 | 17% | 0.45 (TW – $500) | |
| SGD 750 & Above | 17% (Max. of SGD 1,258) | 15% (Max. of SGD 1,110) | |
| 55 – 60 | SGD 50 – SGD 500 | 15.5% | – |
| SGD 500 – SGD 750 | 15.5% | 0.375 (TW – $500) | |
| SGD 750 & Above | 15.5% (Max. of SGD 1,147) | 12.5% (Max. of SGD 1,110) | |
| 60 – 65 | SGD 50 – SGD 500 | 12% | – |
| SGD 500 – SGD 750 | 12% | 0.225 (TW – $500) | |
| SGD 750 & Above | 12% (Max. of SGD 888) | 7.5% (Max. of SGD 1,110) | |
| 65 – 70 | SGD 50 – SGD 500 | 9% | – |
| SGD 500 – SGD 750 | 9% | 0.15 (TW – $500) | |
| SGD 750 & Above | 9% (Max. of SGD 666) | 5% (Max. of SGD 1,110) | |
| Above 70 | SGD 50 – SGD 500 | 7.5% | – |
| SGD 500 – SGD 750 | 7.5% | 0.15 (TW – $500) | |
| SGD 750 & Above | 7.5% (Max. of SGD 555) | 5% (Max. of SGD 1,110) |
When to Pay CPF Employer Contributions?
CPF contributions are due by the end of each calendar month in Singapore. While you have a grace period until the 14th of the following month, paying by month-end helps you avoid last-minute issues.
On-time payments protect compliance and reassure employees that their CPF is handled properly. Clear payroll timelines also reinforce your employee value proposition through payroll transparency by building trust and reliability.
Employees can check and question late CPF payments, so keep communication open if anything slips. Resolve delays quickly and document what happened to keep things clean and professional.
What Kinds of Penalties are Being Applied for Businesses?
As a business operating in Singapore, it’s crucial to understand the penalties associated with late or non-payment of Central Provident Fund (CPF) contributions. If you fail to pay by the 14th of the following month, you may incur a late payment interest of 1.5% per month (18% per annum), starting from the first day after the due date, with a minimum charge of $5 per month.
Additionally, first-time offenders can face fines ranging from $1,000 to $5,000 per offence and/or imprisonment of up to six months. Repeat offenders may encounter fines between $2,000 and $10,000 per offence and/or imprisonment of up to 12 months.
Moreover, if you deduct your employee’s share of CPF contributions but fail to remit them to the CPF Board, the penalties are more severe, with fines up to $10,000 and/or imprisonment for up to seven years. To maintain compliance and uphold your professional reputation, ensure timely CPF contributions, and adhere to all regulatory requirements.
Do Employers Need to Pay CPF Contributions for Migrant Workers?
In Singapore, employers generally do not pay CPF contributions for migrant workers on Work Permits or S Passes, because CPF applies to Singapore Citizens and PRs. Instead, employers typically pay the Foreign Worker Levy (FWL).
The Skills Development Levy (SDL) still applies to all employees, including foreign workers. SDL is 0.25% of monthly wages, capped between $2 and $11.25 per employee. Once a worker becomes a PR, CPF contributions must start from the PR grant date, FWL stops, and SDL continues.
In practice, companies with frequent foreign hiring use an HR system solution from HashMicro to track residency status changes and automatically apply the right CPF, FWL, and SDL rules, so payroll stays consistent without manual rework.
Conclusion
CPF contributions are key to payroll accuracy and compliance in Singapore. Managing them consistently helps prevent disputes, protect your employer record, and keep costs predictable.
With recent CPF updates, regular checks and a clear monthly routine are essential to ensure payments stay accurate and on time.
If you want to tighten the process, a short consultation can review your current workflow, spot common gaps, and turn it into a simple checklist your team can reuse each month.
