The Central Provident Fund (CPF) is an essential part of Singapore’s social security system, requiring contributions from both employers and employees. Understanding how CPF contributions are calculated helps you plan your finances, verify your payslips, and make informed decisions. This guide details the CPF calculation process, including contribution rates, allocation across accounts, and important considerations.

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1. Overview of CPF Contributions

CPF contributions are based on your monthly wage, which includes your basic salary and additional wages such as bonuses, overtime pay, and commissions. Contributions are shared between employers and employees, with rates varying by age, income level, and residency status.

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2. Key Factors in CPF Calculation

2.1. Age Group

CPF contribution rates are tiered by age. Younger employees have higher contribution rates, while older workers see reduced rates to cater to their immediate financial needs.

2.2. Wage Type

• Ordinary Wages (OW): Fixed monthly salary.
• Additional Wages (AW): Irregular income, such as bonuses, commissions, and allowances.

2.3. CPF Contribution Ceiling

CPF contributions are capped based on:

1. Ordinary Wage Ceiling: Monthly OW up to S$6,000.
2. Additional Wage Ceiling: Total AW contributions capped at S$102,000 minus annual OW contributions.

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3. CPF Contribution Rates

3.1. For Singapore Citizens and Permanent Residents (PRs)

Contribution rates vary by age:

Employees Aged 55 and Below (2024 onwards)

Income Bracket	Employee Contribution (%)	Employer Contribution (%)	Total Contribution (%)
≤ S$750	Graduated rates apply	Graduated rates apply	Graduated rates apply
> S$750	20%	17%	37%

Reduced Rates for Older Workers

Contribution rates taper for workers aged above 55:

Age Group	Employee Rate	Employer Rate	Total Rate
56–60	13%	13%	26%
61–65	7.5%	9%	16.5%
> 65	5%	7.5%	12.5%

3.2. For Permanent Residents (PRs)

PR contributions follow a phased approach:

• 1st Year: Lower contribution rates.
• 2nd Year: Slightly higher rates.
• 3rd Year Onwards: Full contribution rates.

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4. Allocation of CPF Contributions

Your CPF contributions are distributed across four accounts based on your age:

Account	Purpose	Age Group	Allocation (%)
Ordinary Account (OA)	Housing, education, investments	≤ 35	23% (of 37%)
Special Account (SA)	Retirement savings	≤ 35	6% (of 37%)
MediSave Account (MA)	Medical expenses, insurance premiums	≤ 35	8% (of 37%)
Retirement Account (RA)	Created at age 55 for retirement	> 55	Depends on RA needs

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5. CPF Calculation Example

5.1. Scenario

• Age: 30 years
• Monthly Wage (OW): S$5,000
• Additional Wage (AW): S$2,000

5.2. Step-by-Step Calculation

Step 1: Calculate Total Contributions

1. Ordinary Wage (OW) Contributions:
   • CPF Contribution = 37% × S$5,000 = S$1,850
   • Employee: 20% × S$5,000 = S$1,000
   • Employer: 17% × S$5,000 = S$850
2. Additional Wage (AW) Contributions:
   • AW Ceiling: S$102,000 − (S$5,000 × 12) = S$42,000
   • Contributions apply only to AW ≤ S$42,000.
   • CPF Contribution = 37% × S$2,000 = S$740
   • Employee: 20% × S$2,000 = S$400
   • Employer: 17% × S$2,000 = S$340

Step 2: Allocate Contributions

Using the allocation rates for those aged 30:

Account	OW Contribution (S$)	AW Contribution (S$)	Total (S$)
OA	S$1,150	S$460	S$1,610
SA	S$300	S$120	S$420
MA	S$400	S$160	S$560

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6. Adjustments and Considerations

6.1. Pro-Rated Contributions

If you work for only part of the month, CPF contributions are calculated on a pro-rata basis based on the number of days worked.

6.2. Voluntary Contributions

Individuals can make voluntary top-ups to their own or family members’ accounts, subject to the Annual Contribution Limit of S$37,740.

6.3. CPF Contribution for Non-Resident Employees

Foreign employees on Employment Passes or S Passes do not contribute to CPF.

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7. Checking and Verifying CPF Contributions

1. Monthly Payslip: Verify CPF contributions against the CPF component breakdown.
2. CPF Mobile App: Use the app to check contribution details.
3. myCPF Portal: Log in with Singpass to view detailed contribution statements.

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8. Frequently Asked Questions (FAQs)

Q1. What happens if my employer doesn’t contribute CPF?

Employers who fail to pay CPF contributions are violating the CPF Act. Employees can report non-compliance to the CPF Board.

Q2. Is CPF contribution mandatory for part-time workers?

Yes, part-time workers earning more than S$50/month are entitled to CPF contributions.

Q3. Can I stop my CPF contributions?

No, CPF contributions are mandatory for all eligible employees.

Q4. Are CPF contributions taxable?

CPF contributions are tax-free, but interest earned from CPF savings is non-taxable.

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9. Future Adjustments to CPF

CPF contribution rates and allocation percentages are periodically reviewed to adapt to Singapore’s evolving economic and demographic landscape. Keep an eye on government announcements for updates.