Central Provident Fund (CPF) obligations are a critical aspect of employment in Singapore. As an employer, you are responsible for ensuring accurate contributions to support your employees’ long-term financial security. A firm grasp of CPF employer obligations helps you stay compliant with the law and demonstrates your commitment to employee welfare. This guide explores everything you need to know about fulfilling your CPF responsibilities effectively. 

TL;DR: Quick Takeaways 

• What is CPF? A mandatory social security scheme in Singapore funded by both employers and employees. 

• Employer CPF Contribution Rates: Vary based on age and wages, split into Ordinary, Special, and MediSave Accounts. 

• Timely Submissions: CPF contributions must be submitted by the 14th of the following month to avoid penalties. 

• Penalties for Non-Compliance: Late payments incur 1.5% monthly interest and other fines. 

• Stay Compliant: Use CPF e-Services, accurate calculators, and payroll tools to simplify processes. 
• Pro Tips: Automate CPF processes, keep detailed records, and engage professionals to ensure compliance. 

Employer CPF contributions play a pivotal role in safeguarding employees’ futures. This blog delves into the definition of CPF, employer-specific obligations, calculation methods, submission processes, and the consequences of non-compliance. By the end, you will have a clear roadmap for managing CPF contributions with confidence. 

What is CPF in Singapore? 

Definition and Purpose 

The Central Provident Fund (CPF) is a mandatory social security savings scheme designed to ensure Singaporeans and permanent residents have sufficient savings for retirement, healthcare, and housing needs. Contributions come from both employers and employees, reflecting a joint responsibility for financial preparedness. 

CPF Contributions 

Employer CPF contributions form a significant portion of the CPF ecosystem. Employees contribute from their wages, while employers match these contributions based on prescribed rates. The CPF is allocated into three accounts: the Ordinary Account for housing and education, the Special Account for retirement, and the MediSave Account for healthcare. 

Importance for Employers 

Adhering to CPF contribution rules is not optional. Employers must ensure timely and accurate payments to avoid penalties. Meeting these obligations also enhances trust between employers and employees, strengthening workplace relationships. It’s essential for employers to keep their contact details updated to ensure effective communication regarding CPF matters. 

What Are The Key Employer Obligations Businesses Should Know About CPF?

As an employer in Singapore, it is very important to know your CPF obligations, including obtaining a CPF Submission Number (CSN). This is necessary for following the law and taking care of your employees. You must make sure that all eligible employees, which means Singapore citizens and permanent residents, are part of the CPF scheme. This includes calculating and sending the right CPF contributions based on their age and total wages. You can apply for a CSN using your Singpass. It’s also important to meet the deadlines for contributions and keep up with any changes in policies to do your job well. 

What Are The Current Contribution Rates Of CPF in Singapore 2025?

As an employer in Singapore, understanding your key obligations regarding CPF contributions is paramount. Here’s a breakdown of the crucial aspects: 

CPF Contribution Rate: The amount you contribute to your employees’ CPF accounts depends on several factors, including: 

• Employee’s Age: Contribution rates vary based on the employee’s age group. Generally, younger employees see a higher combined employer and employee contribution compared to older employees nearing retirement. 

• Employee’s Income: The contribution rate is calculated as a percentage of the employee’s total wages, subject to specific CPF contribution limits. 

Current Rates and Account Distribution: The current CPF contribution rates (as of December 2024) are: 

• Employee: Between 5% and 20% of their monthly wages, depending on their age. 

• Employer: Between 7.5% and 17% of their employee’s monthly wages, depending on their employee’s age. 

These contributions are further distributed across the three CPF accounts (OA, SA, and MA) according to a predetermined allocation rate, which also varies based on the employee’s age. 

Eligibility for Contributions 

Employers must make CPF contributions for Singaporean citizens and permanent residents employed full-time, part-time, or on a contract of service basis, as outlined in the CPF Act, which dictates the amount of CPF contributions to pay. Contributions are mandatory for employees earning more than $50 per month, ensuring even lower-wage earners benefit. 

Age also determines eligibility and contribution rates. For instance, employees above 55 have reduced rates to reflect their shifting financial priorities. Employers must account for these variations to maintain compliance. 

Timing of Contributions 

Employers must submit CPF contributions by the 14th of the following month, as the due date is critical for compliance, especially since the 14th can fall on a Saturday, Sunday, or Public Holiday. Late submissions attract penalties, including enforcement action and interest on overdue amounts. Regular submission schedules prevent legal repercussions and ensure smooth payroll operations. 

 

Voluntary Contributions by Employers

As an employer in Singapore, you can make voluntary CPF contributions beyond mandatory requirements to support your employees. These optional contributions show your commitment to staff welfare and can boost employee loyalty and satisfaction.

Why Consider Voluntary Contributions?

You might choose to make voluntary contributions to:

• Recognise outstanding employee performance
• Provide additional retirement benefits
• Establish your company as an employer of choice
• Support staff during special occasions

Who Can Receive Voluntary Contributions?

You can make voluntary contributions for:

• Singapore Citizens
• Singapore Permanent Residents
• Overseas employees who don’t receive mandatory CPF contributions

Types of Voluntary Contributions

1. General Voluntary Contributions to All Three CPF Accounts

• You can contribute up to the CPF Annual Limit (S$37,740 per employee) minus any mandatory contributions already made in the calendar year.
• These contributions will be allocated across the three CPF accounts following standard allocation rates.
• These contributions are non-tax deductible and cannot be backdated.
• Any excess amounts above the Annual Limit will be refunded without interest.

2. MediSave Contributions Under AMCS

• You can contribute up to S$2,730 per employee annually to their MediSave account.
• These contributions aren’t subject to the CPF Annual Limit or the Basic Healthcare Sum.
• AMCS contributions are tax-free for employees, and you may qualify for tax benefits.
• Backdating isn’t permitted.

3. Special/Retirement Account Top-ups

• You can boost your employees’ retirement savings through direct cash top-ups to their Special/Retirement Account.
• You’ll receive tax deductions equal to the amount topped up.
• While these top-ups count as taxable income for employees, they can claim tax relief of up to S$8,000 annually.

Important Considerations Before Making Voluntary Contributions

• All voluntary contributions are irreversible once made.
• You’ll need a new CPF Submission Number (CSN) specifically for voluntary contributions—don’t use your existing CSN for mandatory contributions.
• Assess your financial capability before committing to ensure it doesn’t strain your cash flow.
• Consider incorporating voluntary contributions into your structured employee benefits strategy.
• After receiving your voluntary contribution CSN, you can submit and pay using the same method as for mandatory contributions.

 

How is the Employer Central Provident Fund Contribution Calculated in Singapore? 

Employer CPF contribution in Singapore is calculated based on the employee’s wages and monthly wage, with employer and employee’s share contribution rates ranging from 5% to 20% depending on the employee’s age and wage bracket. Employers must also contribute to the Supplementary Retirement Scheme (SRS) for eligible employees. 

Calculating CPF contributions accurately ensures you fulfill your obligations while avoiding potential errors. Here’s what you need to consider: 

Employee’s Monthly Wage 

The CPF contribution calculation begins with defining an employee’s monthly wage. This includes basic salary, overtime pay, commissions, and bonuses. Proper classification ensures accurate calculations. 

Ordinary Wages vs. Additional Wages 

Ordinary wages refer to regular monthly earnings, while additional wages include bonuses and other one-off payments, which are subject to the additional wage ceiling. Additionally, the CPF ordinary wage ceiling affects how CPF contributions apply differently to these categories and is calculated on a per annum basis. Employers must distinguish between the two to avoid errors. 

CPF Calculator Tools 

CPF Board provides online tools, including a CPF contribution calculator and CPF EZPay, to simplify calculations of total CPF contributions. Employers can use these resources to ensure accuracy and minimise administrative burdens. These tools automatically factor in contribution rates, wage types, and employee profiles, streamlining the process. 

With this in mind, Grof partners with you to take care of the complexities of payroll, giving you more time and energy to dedicate to what matters most: growing your business. 

Submission and Payment 

Once you’ve calculated the CPF contributions, you’ll need to submit them to the CPF Board. Here’s how: 

 

How to Submit CPF Contributions?

CPF e-Services streamline the submission process. Employers must create an account on the CPF Board website and upload contribution details each month. Automated systems reduce errors and save time. 

Modes of Payment 

CPF payments can be made via GIRO, online banking, or cheque from your bank account. GIRO remains the most popular method due to its convenience and reliability. Ensuring payments reach CPF on time is crucial for compliance. 

Steps to Ensure Compliance 

You can implement best practices, such as conducting monthly reviews of CPF submissions and maintaining updated employee records. Regular audits identify discrepancies early, reducing risks of penalties. More details will be shared in the article later. 

 

What Are The Penalties for Non-Compliance With the CPF Board?

Failure to comply with CPF regulations can result in significant penalties. Here’s what you need to be aware of: 

Late Payment Interest 

Late payments incur interest at 1.5% per month or part thereof. This interest accrues daily, significantly increasing costs over time. Prompt payments eliminate these avoidable expenses. 

Other Penalties 

Beyond interest, employers face administrative fines and potential legal action for non-compliance. Persistent offenders risk reputational damage, further complicating business operations. 

Compliance safeguards against these risks, ensuring business continuity and maintaining trust among stakeholders.

 

Key CPF Updates for Singapore Employers After Budget 2025

The Singapore government announced several important CPF changes following the 2025 Budget Statement and Committee of Supply Debates. Here’s what you need to know as an employer:

1. Higher CPF Contribution Rates for Senior Workers (2026)

• You will need to increase CPF contribution rates for your employees aged 55-65 by 1.5 percentage points in 2026.
• You will receive a CPF Transition Offset covering half of your increased employer CPF contributions.
• The government will apply this offset to your account automatically without requiring you to submit applications.

2. Extended Retirement Savings Support

• From January 2026, your employees with disabilities of all ages may qualify for the expanded Matched Retirement Savings Scheme (MRSS).
• If you help your eligible senior employees aged 55-70 with MediSave top-ups, the government will match your contributions dollar-for-dollar up to S$1,000 annually from 2026 to 2030 under the new Matched MediSave Scheme (MMSS).

3. Improved Silver Housing Bonus Scheme

• Starting December 2025, your senior employees who downsize to smaller flats will enjoy enhanced support through the Silver Housing Bonus (SHB) scheme.
• Your employees who right-size to 2-room or smaller flats can receive up to S$40,000, an increase from the previous S$30,000 maximum.
• If your employees are downsizing from private properties with an Annual Value between S$21,000 and S$31,000, they can now benefit from this scheme.

4. MediSave and MediShield Life Improvements

• From October 2025, your employees can withdraw up to SGD400 annually from Flexi-MediSave, up from S$300.
• Your employees will benefit from a doubled MediSave outpatient scans annual withdrawal limit from S$300 to S$600 beginning January 2026.
• By mid-2026, your employees aged 60 and above can use Flexi-MediSave for select dental procedures at CHAS dental clinics and public healthcare institutions.

These updates aim to help you support your employees’ retirement adequacy and healthcare needs while managing your business costs.

Sources for Updates 

Regularly checking official sources like the CPF Board and Ministry of Manpower ensures you stay ahead of regulatory changes. Engaging professionals for updates is another reliable option. 

 

Practical Tips for Employers To Streamline CPF Payments

To simplify CPF management and ensure compliance, consider the following practical tips: 

Record-Keeping: 

• Maintain accurate and up-to-date payroll records for all employees. 
• Organise records systematically for easy reference and audits. 

Automating CPF Processes: 

• Consider using payroll software that integrates with CPF e-Services to automate CPF submission and payment. 
• Automate calculations and generate reports to streamline the process. 

Engaging a Professional: 

• If you find CPF management complex or time-consuming, consider engaging a professional payroll service provider like Grof. 
• They can handle CPF calculations, submissions, and payments on your behalf, ensuring compliance. 

 

Conclusion 

Understanding and fulfilling your CPF employer obligations is crucial for a compliant and responsible business. By following the guidelines outlined in this blog post in accordance with CPF regulations, you can ensure timely and accurate CPF contributions, avoid penalties, and maintain a positive relationship with your employees. 

Remember, staying informed about CPF policy changes and leveraging technology, such as PayNow or Direct Debit, can significantly simplify CPF management, especially through the CPF mobile app. If you have any doubts or require further assistance, don’t hesitate to consult with a CPF advisor or a professional payroll service provider. 

Take control of your CPF obligations today! Visit Grof’s website to explore our comprehensive payroll and accounting solutions. Let us help you streamline your CPF management and focus on what truly matters – growing your business. 

Final Thought: By prioritising CPF compliance, you not only demonstrate your commitment to your employees’ financial well-being but also contribute to the overall social security landscape of Singapore.