The Central Provident Fund (CPF) remains a cornerstone of Singapore’s social security system, designed to support citizens in their retirement, healthcare, and housing needs. Administered by the CPF Board, this compulsory savings scheme involves monthly contributions from both employers and employees, calculated based on Ordinary Wages (OW) and Additional Wages (AW).
In 2025, several important changes come into effect, including a higher Ordinary Wage ceiling, revised CPF interest rates, and adjusted contribution rates for older employees and Singapore Permanent Residents (SPRs).
CPF Contribution Structure
CPF contributions are split into two categories;
• Ordinary Wages (OW): Monthly regular salary, including allowances and overtime.
• Additional Wages (AW): Bonuses, commissions, and one-off payments.
For 2025, the CPF salary ceilings are as follows:
| Category | Ceiling |
|---|---|
| Ordinary Wages (OW) | SGD 7,400/month |
| Annual Salary Ceiling | SGD 102,000/year |
| Additional Wages (AW) | 102,000 – Total OW in 2025 |
CPF Account Breakdown
CPF contributions are distributed across four accounts;
• Ordinary Account (OA): Used for housing, education, and insurance.
• MediSave Account (MA): Reserved for healthcare expenses and insurance.
• Special Account (SA): For retirement savings with higher interest.
• Retirement Account (RA): Automatically created at age 55, combining OA and SA funds to provide monthly retirement payouts.
Employer and Employee Contribution Responsibilities
CPF contributions are mandatory for:
• Singapore Citizens and SPRs earning more than SGD 50/month.
• Employers must remit both employee and employer shares to the CPF Board monthly.
What’s New in CPF Contributions for 2025?
1. Higher OW Ceiling
• Increased from SGD 6,800 to SGD 7,400/month, allowing higher earners to contribute more toward retirement.
2. Revised CPF Interest Rates (As of Q4 2024)
| Account Type | Base Interest Rate |
|---|---|
| OA | 2.5% |
| SA / MA / RA | 4.14% |
Additional Interest:
| Age Group | Balance Tier | Extra Interest |
|---|---|---|
| Below 55 | First SGD 60,000 | +1% |
| 55 and above | First SGD 30,000 | +2% |
| Next SGD 30,000 | +1% |
3. Senior Workers’ Fund Allocation
• From January 2025, Special Account (SA) balances of older employees are redirected to Retirement Account (RA) to improve payout sustainability.
2025 CPF Contribution Rates (Employees Earning > SGD 750/month)
| Age Group | Total Rate | Employer Share | Employee Share | Change vs 2024 |
|---|---|---|---|---|
| 55 & below | 37% | 17% | 20% | No change |
| 55–60 | 32.5% | 15.5% (+0.5%) | 17% (+1%) | +1.5% total |
| 60–65 | 23.5% | 12% (+0.5%) | 11.5% (+1%) | +1.5% total |
| 65–70 | 16.5% | 9% | 7.5% | No change |
| Above 70 | 12.5% | 7.5% | 5% | No change |
CPF Contributions for Employees Earning $500–$750/month
CPF contributions are prorated based on wage amounts exceeding SGD 500. Here’s a simplified view:
| Age Group | Employer Formula | Employee Formula |
|---|---|---|
| 55 & below | 17% + 0.6 × (TW – 500) | 0.6 × (TW – 500) |
| 55–60 | 15.5% + 0.51 × (TW – 500) | 0.51 × (TW – 500) |
| 60–65 | 12% + 0.345 × (TW – 500) | 0.345 × (TW – 500) |
| 65–70 | 9% + 0.225 × (TW – 500) | 0.225 × (TW – 500) |
| Above 70 | 7.5% + 0.15 × (TW – 500) | 0.15 × (TW – 500) |
TW = Total Wages
CPF Contributions for Singapore Permanent Residents (SPRs)
First-Year SPR Rates:
| Age Group | Total Rate | Employee Share |
|---|---|---|
| All ages | 4% + 0.15 × (TW – 500) | 0.15 × (TW – 500) |
Second-Year SPR Rates:
| Age Group | Total Rate | Employee Share |
|---|---|---|
| 55 & below | 9% + 0.45 × (TW – 500) | 0.45 × (TW – 500) |
| 55–60 | 6% + 0.375 × (TW – 500) | 0.375 × (TW – 500) |
| 60–65 | 3.5% + 0.225 × (TW – 500) | 0.225 × (TW – 500) |
| Above 65 | 3.5% + 0.15 × (TW – 500) | 0.15 × (TW – 500) |
Third Year Onward (Full Rates):
| Age Group | Employer Share | Employee Share |
|---|---|---|
| 55 & below | 17% | 20% |
| 55–60 | 15.5% | 17% |
| 60–65 | 12% | 11.5% |
| Above 65 | 9% | 7.5% |
How to Calculate CPF Contributions
-
Determine total CPF contribution:
Use the PF Board’s online calculator or follow the formula guidelines. -
Rounding Rules:
-
- < $0.50 → round down
- ≥ $0.50 → round up
-
Separate OW and AW calculations:
Calculate CPF separately for OW and AW and sum the two for total contributions.
FAQs
Q: What is the OW ceiling for 2025?
A: SGD 7,400/month.
Q: How is CPF calculated for bonuses or one-off payments?
A: These fall under Additional Wages (AW), subject to the AW ceiling = SGD 102,000 – total OW for the year.
Q: Are CPF contributions mandatory for part-time workers?
A: Yes, if they earn more than SGD 50/month.
Q: Where can I check my CPF contributions?
A: Log in to your CPF account via cpf.gov.sg using Singpass.
Conclusion
The CPF updates for 2025 continue to strengthen Singapore’s retirement safety net, especially for senior workers and higher earners. The higher OW ceiling, adjusted rates, and interest bonuses ensure CPF remains relevant in a changing economic landscape.
Both employers and employees should review the new rates and adjust payroll systems accordingly. For precise computation, use the CPF Board’s official calculator and consult HR or payroll specialists if needed.
Sources & References:
• CPF Board Official Website
• Ministry of Manpower – CPF Updates
• Budget 2025 Speech – CPF Adjustments