If you hire Singapore Citizens or Permanent Residents, you must pay CPF contributions on top of their salary. For a small business owner, getting the rate, the wage ceiling or the payment deadline wrong can mean extra cost and penalties. This guide explains who you need to pay CPF for, the current employer contribution rates, the wage ceilings and how to calculate and pay CPF correctly. Always cross-check figures with the CPF Board website, as rates and ceilings are reviewed from time to time.
Who Must Pay Employer CPF Contributions
Employers must pay CPF contributions for employees who are Singapore Citizens or Singapore Permanent Residents (SPRs) working under a contract of service. This includes part-time staff, subject to wage thresholds. Foreigners on work passes, such as Employment Pass or S Pass holders, are not covered by CPF. Monthly wages of $750 or less attract lower rates or none, and the full rates below apply to wages above $750.
Employer CPF Contribution Rates
The rates below apply to Singapore Citizens and SPRs from their third year of PR status who earn more than $750 a month. They are the 2026 rates, so confirm the latest table before you run payroll.
- Age 55 and below: employer 17%, employee 20%, total 37%
- Above 55 to 60: employer 16%, employee 18%, total 34%
- Above 60 to 65: employer 12.5%, employee 12.5%, total 25%
- Above 65 to 70: employer 9%, employee 7.5%, total 16.5%
- Above 70: employer 7.5%, employee 5%, total 12.5%
Rates for employees above 55 to 65 are scheduled to rise again from 1 January 2027. For those above 55 to 60, the employer share goes to 16.5% and the employee share to 19%. For those above 60 to 65, both shares go to 13%. Update your payroll settings when the new rates start.
CPF Wage Ceilings You Need to Know
- Ordinary Wage (OW) ceiling: $8,000 per month from 1 January 2026. CPF is calculated only on Ordinary Wages up to this amount.
- Additional Wage (AW) ceiling: $102,000 minus the total Ordinary Wages subject to CPF for the year. It limits CPF on bonuses and other non-monthly pay.
- Annual CPF limit: $37,740 per employee per year, covering employer and employee contributions combined.
Ordinary Wages are paid for work done in the month, such as basic salary and regular allowances. Additional Wages are not for work done solely in one month, such as annual bonuses and commissions paid at intervals longer than a month.
Worked CPF Examples for Employers
Example 1: Your employee is a 40-year-old Singapore Citizen earning $4,000 a month. Your employer CPF is 17% of $4,000, which is $680. The employee share is 20%, which is $800 and is deducted from salary. The total CPF paid is $1,480.
Example 2: Your employee is a 35-year-old Singapore Citizen earning $9,000 a month. CPF is calculated on the $8,000 ceiling only. Employer CPF is 17% of $8,000, which is $1,360, and the employee share is $1,600.
New Permanent Residents and Graduated Rates
Newer SPRs start on graduated rates. For an employee aged 55 and below earning more than $750, the first year is 4% employer and 5% employee, and the second year is 9% employer and 15% employee. Full rates apply from the third year. Check the CPF Board website for the rules on applying for full rates earlier, and keep a record of each SPR employee’s start date.
How to Register and Pay CPF as an Employer
- Make sure your business has a CPF Submission Number (CSN), which you use to submit and pay contributions.
- Work out each employee’s age band, residency status and wages for the month.
- Calculate the employer and employee shares, applying the Ordinary Wage ceiling.
- Deduct the employee share from salary and add your own share to the total payable.
- Submit and pay through the CPF Board’s e-services by the due date, which is usually the 14th of the following month. Confirm exact dates with the CPF Board, as weekends and public holidays can affect timing.
Common CPF Mistakes to Avoid
- Using outdated rates after a January rate change.
- Forgetting to apply the Ordinary Wage ceiling for higher-paid staff.
- Ignoring the Additional Wage ceiling when paying bonuses.
- Treating work pass holders as CPF-eligible, or missing the date an employee becomes an SPR.
- Not updating the rate when an employee moves into a new age band. The new rate normally applies from the month after the birthday.
- Paying late. Late payment can attract interest, so set a payroll reminder well before the deadline.
Frequently Asked Questions
How much CPF does an employer pay in Singapore?
For employees aged 55 and below on full rates, the employer pays 17% of wages, up to the $8,000 monthly Ordinary Wage ceiling. The employee pays a further 20%.
Do employers pay CPF for foreign employees?
No. CPF applies to Singapore Citizens and Permanent Residents. Foreign employees on work passes are not covered.
Do I need to pay CPF on bonuses?
Yes. Bonuses count as Additional Wages and attract CPF up to the Additional Wage ceiling for the year.
What is the CPF Ordinary Wage ceiling?
The Ordinary Wage ceiling is $8,000 per month from 1 January 2026. Salary above this amount does not attract CPF on the Ordinary Wage side.
When is the CPF payment due?
Employers usually need to pay by the 14th of the following month. Check the CPF Board website for the exact date each month.
Still setting up your business? Read our step-by-step guide to registering a company with ACRA and our guide to GST registration for small businesses. This article is for general information only and is not professional advice. Check with the CPF Board or an accountant for your specific situation.