CPF (Central Provident Fund)
is Singapore’s mandatory savings scheme for citizens and permanent residents: employers contribute up to 17% and employees up to 20% of wages (age-banded), split across Ordinary, Special and MediSave accounts. Foreigners on work passes are excluded — a defining feature of Singapore expat employment costs.
CPF mechanics employers budget around
Contributions apply to wages up to the monthly ceiling (raised to SGD 8,000 by 2026 under the announced schedule) plus an annual ceiling for additional wages; rates taper for older age bands. Payment is monthly with penalties for lateness.
Because Employment Pass and S Pass holders sit outside CPF, hiring a foreigner versus a local changes cost structure materially — one reason Singapore quotes packages differently for the two populations. Official rates: cpf.gov.sg.
FAQ
Why don’t foreigners pay CPF in Singapore?
Policy design: CPF is a citizen/PR savings system, and work-pass holders are expected to make their own arrangements. Employers sometimes offer supplementary retirement benefits to expats to balance packages — voluntary, not statutory.
What are Ordinary, Special and MediSave accounts?
CPF splits contributions by purpose: Ordinary (housing, investment, education), Special (retirement), MediSave (healthcare). Allocation percentages shift with age, feeding Singapore’s housing and healthcare financing model — relevant context when localising benefits explanations for PR hires.