Keeping up with the changes in regulations can be tough while running a business. Here at Payboy, we have put together a comprehensive CPF guide to answer your FAQs regarding CPF contributions, as well as keep you posted on the revised CPF contribution rates from 1 January 2022 onwards!
Yes. Under the CPF Act, all employers are required to pay CPF contributions for their employees who are Singapore Citizens or Singapore Permanent Residents and who are earning total wages of more than $50 per month.
As long as your employee is engaged under a contract of service, earns above $50 per month AND is a Singapore Citizen or a Singapore Permanent Resident, you are required to pay the employer’s share of CPF contributions. This therefore includes the following types of employees:
There is however no employee’s share of CPF contribution if the employee earns less than $500 per month.
The CPF contribution rates for employees aged above 55 to 70 will be increased from 1 January 2022 to strengthen their retirement adequacy.
This table summarises the contribution rates for SIngapore Citizens and Singapore Permanent Residents (from third year and onwards) for monthly wages > $750 from 1 January 2022:
|Employee’s age||By Employer(% of wage)||By Employee (% of wage)||Total (% of wage)|
|55 & below||17||20||37|
|Above 55 - 60||14||14||28|
|Above 60 - 65||10||8.5||18.5|
|Above 65 - 70||8||6||14|
The total wages are made up of an employee’s Ordinary Wages and Additional Wages.
Ordinary wage refers to wages which are granted wholly and exclusively for the month while Additional wages refers to wages such as annual bonus, leave pay and incentive payments, such as long service awards.
Different ceilings are applied to Ordinary Wages and Additional Wages.
The ordinary wage ceiling is currently capped at $6,000 while the additional wage ceiling is computed as:
$102,000* - Total Ordinary Wage subject to CPF for the year
Allowance is considered wages and hence will be subjected to CPF contributions as well. Some examples include monthly meal and transport allowance. Here is a more comprehensive list of allowance and payments which attract CPF contributions, as published by the CPF board.
We have created 2 free calculators for you to calculate your employee’s CPF contributions with ease:
There are two convenient ways to submit your CPF contributions: CPF EZPay and CPF EZPay Mobile.
CPF EzPay: Save time by letting CPF EZPay auto-compute your contributions. You can also set up a standing instruction for recurring CPF payments.
CPF EzPay Mobile: Submit CPF contributions on-the-go using your mobile device. Simply download the app to get started.
Yes, an employer needs to pay the total CPF contributions (comprising the employer and employee’s shares) to the CPF Board. However, the employer is entitled to recover the employee’s share of CPF contributions when paying your employee’s wages for the month.
Employers are required to submit and pay the CPF contributions by the 14th of the following month (or the next working day if the 14th falls on a Saturday, Sunday, or Public Holiday).
For employers who failed to submit and pay CPF contributions by the 14th of the following month (or the next working day if the 14th falls on a Saturday, Sunday, or Public Holiday), there will be a late payment interest charged at 1.5% per month, commencing from the first day after the due date.
The CPF Board will first send a notice to inform the company that legal action will be taken upon detecting late payment or non-payment of CPF contributions.
If the employer still doesn’t pay and is convicted for offences under Section 58(1)(b) of the CPF Act, they will be liable for:
The CPF Board will also seek a court order requiring the employer to pay outstanding CPF contributions and late payment interest.
Failure to pay employee’s share of CPF contributions despite recovering employee’s share from his/her wages may result in a fine up to $10,000 and/or up to 7 years’ imprisonment.
Yes! In fact, you can do e-submission of CPF contributions through Payboy’s portal.
The following are automatically included in the CPF file generated by Payboy:
Here’s our useful guide on “How to generate CPF e-submit file” with our payroll software.
Yes Payboy is eligible under the PSG Grant! You can find our answers to your questions regarding PSG grant here.