As an employer, you are required to make CPF contributions at the monthly rates stated in the CPF Act. You can recover your employee's share of the contribution by deducting it from their wages.
Employees who require CPF contributions
You must pay CPF contributions for your employees who are Singapore citizens or Singapore permanent residents (SPRs).
An employee is any person who is employed in Singapore. This includes any Singaporean seaman who is employed under a contract of service or other agreement entered into in Singapore.
The following employees are also eligible for CPF contributions:
- Company directors.
- Part-time or casual employees.
- Operationally Ready NSmen on in-camp training. You have to pay CPF contributions on an NSman’s wages, including makeup pay from MINDEF. You can recover the employee’s share of the contributions from his wages.
- Family members of the business owner, if they are receiving wages for work done for the owner.
- Employees concurrently employed by another employer.
When to pay CPF contributions
CPF contributions are due at the end of the month. You have a grace period of 14 days to pay it.
If the 14th day falls on a Saturday, Sunday or public holiday, you can pay by the next working day.
Recovering your employee's share of CPF contributions
You must pay both the employer’s and employee’s share of the monthly CPF contribution. However, you can recover your employee’s share by deducting it from their wages when the contributions are paid for that month.
If you did not recover the money by then, and it was not due to negligence, you can still do so. This is provided you have:
- Paid the CPF contributions.
- Forwarded your employee’s written consent to the Board, or obtained the Board’s written permission.
You need to recover the employee’s share within 6 months of the time the contributions should have been recovered.
Foreign workers and CPF
If you are paying the foreign worker levy for your foreign workers, you do not have to pay CPF contributions for them. However, you are required to pay the Skills Development Levy (SDL).
Work Permit holders will come under the CPF scheme if they become Singapore permanent residents. This takes effect from they day are granted permanent residency.
Penalties for not paying CPF
If you don’t comply with the CPF Act, you may be liable to:
- Late payment interest charged at 18% per annum (1.5% per month), starting from the first day of the following month after the contributions are due. The minimum interest payable is $5 per month.
- A fine of up to $5,000 and no less than $1,000 per offence and/or up to 6 months jail.
- A fine of up to $10,000 and no less than $2,000 per offence and/or 12 months jail for repeat offenders.
- Fine of up to $10,000, imprisonment of up to 7 years or both if you deduct your employee’s share of CPF contributions but fail to pay the contributions to CPF Board.
For more information on an employer’s CPF obligations, refer to the CPF Board’s Employers’ Guide to CPF.