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Compliance
Published:
January 12, 2026
Last updated:
January 9, 2026
An employer’s role in ensuring that its employees are well taken care of in terms of wages and statutory contributions is a significant one. Playing a part in helping your employees secure a good foundation during their prime years of working and building a safety net for their retirement is never a small part – it is a vital one that is often cited as one of the most important criteria that can retain talent.
Companies that hire employees in Singapore are mandated by law to make Central Provident Fund (CPF) contributions to their employees. If you are an employer looking for information on CPF contributions and how to do so for your employees, this blog post is a handy guide.
CPF is Singapore's comprehensive national savings and social security scheme. Established to meet significant financial needs including retirement, healthcare, home ownership, and family protection, CPF operates as a mandatory savings program based on employment—requiring eligible employees and their employers to contribute monthly to the fund.
The CPF system is structured around multiple accounts with specific purposes:
Used for housing, insurance, investment, and education expenses. Funds in the OA earn a base interest rate (currently 2.5% per annum) and can be used for:
For employees purchasing property in Singapore—common among mid-career professionals relocating for regional roles—OA balances become critical for mortgage eligibility and affordability.
Reserved primarily for retirement and investment in retirement-related financial products. SA balances earn higher interest (currently 4% per annum for first $60,000 combined OA+SA balances, then varies based on age). SA funds generally cannot be withdrawn until retirement eligibility age (currently 55 years old for Retirement Account creation, full withdrawal typically at age 65+).
Dedicated to healthcare expenses including hospitalization, certain outpatient treatments, medical insurance premiums (MediShield Life, Integrated Shield Plans), and approved chronic disease management. MA contributions ensure employees maintain healthcare funding throughout their working life and retirement.
Created automatically when a Singaporean or Permanent Resident turns 55 years old. The RA combines savings from OA and SA to meet the Full Retirement Sum (FRS)—the amount required to join CPF LIFE, Singapore's longevity insurance scheme providing monthly payouts from age 65 onwards. For 2026, the FRS is S$205,800 (adjusted annually for inflation).
The CPF Act defines "employee" as:
Employment can be structured on various terms:
CPF eligibility requirement: Any employee who is a Singapore Citizen or Permanent Resident earning total wages exceeding S$50 per month is entitled to CPF contributions from their employer.
Certain employee categories are exempted from mandatory CPF:
Students: Those fulfilling exemption criteria from approved educational institutions including:
Foreigners: Work Pass holders (Employment Pass, S Pass, Work Permit holders) who are not Singapore Citizens or Permanent Residents do not require CPF contributions. However, they may be subject to Foreign Worker Levy depending on pass type and sector.
Domestic employees: Household workers (cooks, maids, gardeners, drivers) whose employment does not exceed 14 hours per week are exempted. Full-time domestic workers (typically foreign domestic workers on Work Permits) are also CPF-exempt.
United Nations personnel: Employees of the United Nations or any UN agency/institution stationed in Singapore are exempted under international agreements.
Certain seamen: Singapore citizens employed on Swedish, Norwegian, or Danish ships under specific conditions meeting exemption criteria are not subject to CPF.
For organizations hiring across Singapore, understanding eligibility distinctions becomes critical—misclassifying employees as exempt when they should receive CPF creates compliance exposure and employee disputes.
The following table summarises the contribution rate for CPF 2026:
Employers must pay CPF contributions by the last day of the calendar month for wages paid in the previous month. For example, CPF contributions for January wages must be paid by February 28 (or 29 in leap years).
Late payment consequences:
For organizations managing cash flow across multiple APAC markets with different statutory payment deadlines (Malaysia EPF by 15th, Philippines SSS by 10th, Singapore CPF by last day), coordinated payment scheduling becomes critical to avoid late payment penalties.
Employers submit CPF contributions electronically through CPF eSubmission portals or approved payroll software with CPF API integration. Submission includes:
For organizations managing 50+ employees in Singapore, automated CPF submission through integrated payroll systems reduces manual data entry errors and ensures consistent on-time filing.
Employers must provide employees with itemized payslips showing:
Transparent CPF communication helps employees understand total compensation value—not just take-home salary. An employee earning S$5,000 monthly receives S$850 employer CPF contribution (17%), making total compensation S$5,850—a meaningful difference when comparing offers.
Situations requiring CPF adjustment include:
Inform affected employees immediately: Notify employees about the CPF adjustment—whether correction increases or decreases their contributions. Transparent communication prevents disputes and maintains trust, particularly when adjustments affect take-home pay.
Rectify errors within one year: The CPF Board encourages employers to correct contribution errors promptly while documentary evidence remains fresh and accessible. Adjustment requests should be submitted immediately and no later than one year from the date of the original CPF contribution payment.
After one year: Late adjustment requests require detailed justification and supporting documentation (payroll records, employment contracts, wage payment evidence). CPF Board evaluates late requests case-by-case, with approval not guaranteed.
Verify fund availability for refunds: When requesting refunds of over-contributions, adjustments are subject to availability of funds in the employee's CPF account. If the employee has already withdrawn or utilized the over-contributed amount (for property purchase, investments, or other approved uses), refunds may not be possible.
For organizations managing payroll corrections across multiple APAC markets, Singapore's one-year adjustment window is relatively strict compared to some jurisdictions—emphasizing the importance of accurate initial CPF processing.
For organizations scaling across APAC with operations in Singapore, Malaysia, Vietnam, and the Philippines, statutory contribution complexity varies significantly:
Higher total contribution rates in Singapore (37%) compared to Malaysia EPF (24%), Philippines SSS/PhilHealth/Pag-IBIG (combined ~13%), or Vietnam social insurance (~32%)—impacting total employment cost planning and budget allocation across markets.
Age-based contribution rates require payroll systems that automatically adjust CPF calculations as employees age—more complex than flat-rate systems in most APAC markets.
Salary ceiling implications mean CPF contributions plateau for higher earners, while countries like Malaysia have lower EPF ceilings—affecting compensation structuring for senior and regional leadership roles.
Transparent employee communication about CPF value becomes important in Singapore where employees actively track balances for property purchases and retirement planning—different from markets where statutory benefit visibility is lower.
Organizations managing 100–300 employees across multiple APAC markets benefit from consolidated payroll infrastructure that handles jurisdiction-specific contribution calculations, filing deadlines, and regulatory compliance automatically.
Explore managing statutory compliance across APAC markets.
For organizations expanding into Singapore without dedicated in-country HR specialists, maintaining CPF compliance while managing operational hiring, payroll, and employee relations requires either building internal Singapore payroll expertise or partnering with providers who have direct entity presence and local advisory capabilities.
AYP's Employer of Record services in Singapore provide compliant hiring infrastructure, automated CPF processing (including age-based rate adjustments, ordinary/additional wage tracking, and timely monthly submissions), and in-market HR advisory support for complex scenarios like CPF adjustments, employee transfers, and compensation structuring.
If you are looking to hire talents in Singapore and expand your business globally, AYP is your trusted HR partner providing sound HR solutions such as EOR and PEO.
