The New Employer’s Guide to CPF

Further the blog post on what CPF is. We thought it will be helpful to post a general guide to how CPF works (with useful links to CPF Website), for the new entrepreneurs setting up business in Singapore.


You are an employer, and employing Singapore citizens or Permanent Residents (PR) in your company- you are required contribute to CPF for your employees at the end of each month.

Know your role as an employer. CPF conducts regular audits on employers to ensure that CPF contributions are paid correctly and on time (14 days grace period is given at end month). CPF also takes feedback from employees on incidences where employers have not paid or under-paid their CPF contributions. Note that the penalty to employers breaching the CPF Act may be taken to court and if convicted, fined up to $10,000 or imprisonment, or both.

With that in mind, let’s get this right. 

Contribution on Employee Wages and Age Group
CPF contributions should be determined based on the employee’s total wages for the entire month. This includes overtime pay, allowances, cash awards, commissions and bonuses. Find out which types of payment attracts CPF Contributions here.

The CPF contribution rate is determined by different age groups. There are 6 defined age groups and the CPF contribution rates decreases as an employee moves to the next age group.

Here are the 6 age groups:

  • 35 years and below
  • Above 35 and below 50 years
  • Above 50 and below 55 years
  • Above 55 and below 60 years
  • Above 60 and below 65 years
  • Above 65 years

As of 1 January 2015, the CPF contribution rates have increased to help employees save more for retirement and medical.

Click to find out the updated contribution rates. CPF website also offers a contribution calculator.

When to Pay Contributions
The CPF contributions are due at the end of every month with 14 days grace period given at the end month. Should the last day of the grace period falls on a weekend or public holiday, your payment will be due on the next business day.

You are required to pay the employer’s and employee’s share of CPF contributions monthly for all employees (Singapore Citizens and Singapore Permanent Residents) at the rates set out in the CPF Act. The CPF contributions payable should be based on the employee’s actual total wages earned for the calendar month.

How to Make Your Payment
CPF has made payment easy for new employers via online Direct Debit. As soon as you started the process of hiring your first employee, you should submit your CPF details using CPF e-Submit@web using the Singpass and Unique Entity Number (UEN).

Once you are approved, you will receive the an email and a welcome letter containing your CPF Submission Number, Payment Advice (CPF91) and Direct Debit Authorisation Form.

Here’s more details on Direct Debit deductions and FAQs 

Was this post helpful? Comment and let us know.

Want to learn more about how PayrollHero can help you get your Singapore time, attendance, scheduling and payroll setup? Contact us for a one on one demo.