The Central Provident Fund (CPF) is a cornerstone of Singapore’s social safety net, ensuring that citizens and permanent residents (PRs) have adequate savings for essential needs such as healthcare, housing, and retirement. Established in 1955, the CPF scheme has evolved over the years to adapt to Singapore’s changing socio-economic landscape. In 2025, new CPF contribution rates further enhance savings potential while maintaining affordability for both employers and employees.
The CPF operates on a system of shared responsibility between employers and employees. Contributions are calculated based on an individual’s monthly salary and additional wages, and the rates differ according to age, employment status, and citizenship. These variations ensure that contributions are fair and sustainable, enabling workers to build sufficient savings over their lifetime.
Singapore’s CPF contribution updates for 2025 reflect a commitment to strengthening the financial resilience of its workforce. Whether you are a Singaporean, PR, or an employer, understanding these contributions is essential to manage financial obligations and leverage CPF benefits effectively.
What Are CPF Contributions?
CPF contributions are compulsory savings made by employees and employers to build a financial safety net. These contributions are channeled into three primary accounts:
- Ordinary Account (OA): For housing, insurance, and education expenses.
- MediSave Account (MA): For healthcare expenses and medical insurance premiums.
- Special Account (SA): For retirement savings and investment in long-term financial products.
The CPF system is structured to address the evolving needs of individuals as they age. Younger workers save more for housing and education, while older workers focus on healthcare and retirement savings.
Components of CPF Contributions
- Ordinary Wages (OW): Fixed monthly salaries subject to CPF contributions, capped at $7,400.
- Additional Wages (AW): Irregular payments like bonuses, subject to an annual limit of $102,000 minus OW.
CPF Contribution Rates for Singapore Citizens in 2025
CPF contributions are shared between employers and employees, with total rates determined by the employee’s age and income. The table below outlines the 2025 rates for Singapore Citizens.
| Age Group | Monthly Wages | Total Contribution Rate | Employee’s Share | Employer’s Share |
|---|---|---|---|---|
| 55 and Below | ≤ $50 | Nil | Nil | Nil |
| $50 – $500 | 17% | Nil | 17% | |
| > $750 | 37% | 20% | 17% | |
| 55 to 60 | > $750 | 32.5% | 17% | 15.5% |
| 60 to 65 | > $750 | 23.5% | 11.5% | 12% |
This system ensures proportional contributions, enabling individuals to save adequately for healthcare, housing, and retirement.
Contribution Rates for Singapore Permanent Residents (SPRs)
For SPRs, CPF contributions start at graduated rates in the first two years of residency. This gradual adjustment helps both employees and employers manage the financial impact of CPF obligations.
1st Year Rates
| Age Group | Total Contribution Rate | Employee’s Share | Employer’s Share |
|---|---|---|---|
| 55 and Below | 4% | Nil | 4% |
| 55 to 60 | 4% | Nil | 4% |
| 60 to 65 | 3.5% | Nil | 3.5% |
2nd Year Rates
| Age Group | Total Contribution Rate | Employee’s Share | Employer’s Share |
|---|---|---|---|
| 55 and Below | 9% | 5% | 4% |
| 55 to 60 | 6% | 3.5% | 2.5% |
| 60 to 65 | 3.5% | 1.5% | 2% |
These rates reflect Singapore’s inclusive approach to integrating PRs into the CPF system while minimizing immediate financial strain.
Important Rules and Calculations
Ordinary Wage (OW) Ceiling
The CPF contribution ceiling for OW is capped at $7,400 per month. Earnings above this threshold are not subject to CPF contributions.
Additional Wage (AW) Ceiling
The AW ceiling is determined as $102,000 minus the OW subject to CPF for the year. This ensures that contributions remain equitable for employees receiving bonuses or other irregular payments.
Rounding Rules
CPF contributions are rounded to the nearest dollar:
- Amounts below $0.50 are rounded down.
- Amounts of $0.50 or more are rounded up.
How to Calculate CPF Contributions
Calculating CPF contributions is straightforward with these steps:
- Determine Total Wages: Add OW and AW for the month.
- Apply Relevant Rates: Use the rates applicable to the employee’s age and income.
- Round Off Contributions: Follow CPF rounding rules for accuracy.
- Calculate Employer and Employee Shares: Split the total contribution according to the rate structure.
Example Calculation
For an employee aged 30 earning $4,000 in OW:
- Total Contribution: $4,000 × 37% = $1,480
- Employee’s Share: $4,000 × 20% = $800
- Employer’s Share: $1,480 – $800 = $680
Why CPF Contributions Matter
CPF contributions are more than a statutory obligation; they are an investment in financial security. Key benefits include:
- Healthcare: The MediSave account covers medical expenses, reducing financial strain during emergencies.
- Housing: CPF savings enable affordable homeownership by financing HDB flats and repaying housing loans.
- Retirement: The Retirement Account ensures a steady income during retirement, offering peace of mind.
The CPF system also fosters a culture of saving and financial planning, empowering individuals to take charge of their financial future.
The CPF Contribution Table 2025 provides a detailed framework for ensuring financial security through employer and employee contributions. By understanding the rates and applying best practices in calculation, individuals and businesses can meet CPF obligations effectively. Singapore’s CPF system remains a cornerstone of its economic and social stability, promoting disciplined savings and long-term financial resilience.