Permanent Residents CPF Contribution
As we have mentioned before, CPF also applies to permanent residents. After the grueling process to be Singapore permanent residents, they have to learn about CPF contribution and start their contribution. Luckily, the government requires slightly different rates for people who have just become permanent residents to contribute to the CPF so they can adjust with the CPF scheme and this only applies for the first 2 year from obtaining permanent residency. The date on your 5/5 form is the start date of your permanent resident; it means that the CPF is payable. The first year of CPF contribution starts from the date of permanent resident approval and it ends on the last day of the permanent resident approval anniversary month. For example you became a Singapore permanent resident on July 7, 2018 so your first year of CPF contribution ended on July 31, 2019.
- If you’re a graduate employee, in the first year, your CPF contribution rate will be 5% of your wage (capped at SGD 300). In the second year, your CPF contribution rate will be 15% of your wage (capped at SGD 900).
- For a graduate employer, in the first year, the CPF contribution rate will be 4% (capped at SGD 240). In the second year, the CPF contribution rate will be 9% (capped at SGD 540).
- If you’re a full employee, in the first year, your CPF contribution rate will be 20% of your wage. In the second year, your CPF contribution rate will be 20% of your wage too.
- For a full employer, in the first year, the CPF contribution rate will be 17%. In the second year, the CPF contribution rate will be 17% too.
Example 1:
Amar is an Indian citizen and holds Singapore permanent resident status for 1 year. He is 27 years old, works as a welder in Singapore and earns SGD 2.500/month. His CPF contribution is:
-Total CPF contribution: 9% x SGD 2.500 = SGD 225 (rounded to the nearest dollar)
-Employee’s share of contribution: 5% x SGD 2.500 = SGD 125 (cents should be dropped)
-Employer’s share of contribution: SGD 225 - SGD 125 = SGD 100
Amar's take home pay every month is SGD 2.375 (SGD 2.500 - SGD 125).
Example 2:
Michael is a Canadian citizen and holds Singapore permanent resident status for 2 years. He is 38 years old, works as an associate in private equity in Singapore and earns SGD 12.000/month with additional wage SGD 1.500/month. His CPF contribution is:
-Total CPF contribution: (24% x *SGD 6.000) + 24% x SGD 1.500) = SGD 1.800 (rounded to nearest dollar)
-Employee’s share of contribution: (15% x SGD 6.000) + (15% x SGD 1.500) = SGD 1.125 (cents should be dropped)
-Employer’s share of contribution: SGD 1.800 - SGD 1.125 = SGD 675
*ordinary wage is capped at SGD 6.000 so if you earn SGD 12.000/month, only the first SGD 6.000 will be subject to CPF contribution.
Based on the calculation above, Michael’s take home pay every month is
SGD 12.375 (SGD 13.500 - SGD 1.125)
For Singapore permanent residents who decide to leave Singapore for good with no intention to come back and work in Singapore in the future, you can withdraw all of your CPF monies and close the CPF account. It is very recommended to close your CPF account while you’re still in Singapore and visit the CPF service centre. But if you’re overseas, apply and fill in the form that is suitable for your condition. Click here. For the deceased permanent residents in Singapore or overseas, click here.