Understanding CPF Contributions and Income Tax for Interns in Singapore

Learn how to distinguish CPF and income tax treatment for interns in Singapore with this article.

Are interns required to contribute to CPF?

All local employees, including interns, are required to contribute to the Central Provident Fund (“CPF”). This policy allows Singapore Citizens and Singapore Permanent Residents to start saving for their retirement at an early stage.

However, employers can be exempted from making CPF contributions on behalf of interns if is the following criteria (as determined after consultation with the Ministry of Education (“MOE”)) is met :

  1. The interns are enrolled in an institution or program subsidized by the MOE; and
  2. The interns are employed for training that is approved by their educational institution.

For internships which are exempt from CPF contributions, employers must obtain documentation from the interns’ educational institution as proof. If the internships are not endorsed by educational institutions, CPF contributions are required, similar to part-time and temporary employment arrangements.

What are the tax implications for foreign students who are interns/trainees in Singapore?

In Singapore, internship income is not subject to taxation if it meets the following conditions:

a) If there was no employment contract signed by the intern (an intern contract is not considered an employment contract);

b) The internship was a compulsory requirement for graduation; and

c) The allowance given is solely intended to cover living expenses such as meals and transportation costs.

In such cases, there is no need to file IR21 or report the internship to IRAS. However, if any of the conditions mentioned above are not fulfilled, then IR21 must be filed one month before the student’s last day of internship.