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Resource

Useful articles on HR and Payroll in Singapore
27 December 2021

CPF Contribution Rates Increase and CPF Transition Offset

 

CPF contribution rates for employees aged above 55 to 70 will be increased. To alleviate the rise in business costs due to the increase in CPF contribution rates for senior workers, employers will be provided with CPF Transition Offset equivalent to half the increase. The changes below will apply to wages earned from 1 January 2022:

 

  

For employees earning monthly wages of more than $750

Employees' age
(years)

Current
(% of wage)

CPF Contribution Rates changes from 1 Jan 2022

Total  
(% of wage)

By employer  
(% of wage)

By employee  
(% of wage)

Above 55 to 60

26

+2

+1

+1

Above 60 to 65

16.5

+2

+1

+1

Above 65 to 70

12.5

+1.5

+0.5

+1

 

The following table summarises the contribution rates for Singapore Citizens and SPRs (from third year and onwards) from 1 January 2022. 

  

Employee's age
(years)

CPF Contribution Rates changes from 1 Jan 2022
(monthly wages > $750)

Total
(% of wage)

By employer
(% of wage)

By employee
(% of wage)

55 & below

37

17

20

Above 55 to 60

28

14

14

Above 60 to 65

18.5

10

8.5

Above 65 to 70

14

8

6

Above 70

12.5

7.5

5



Companies who are using Whyze payroll solution need not worry about the changes as it will be updated and reflected in the CPF records automatically.

CPF Transition Offset (CTO)
To alleviate the rise in business costs due to the increase in CPF contribution rates for senior workers, the Government will provide employers with a transitionary wage offset equivalent to half of the increase in employer CPF contribution rates in 2022, for every Singaporean and Permanent Resident worker they employ aged above 55 to 70.
There is no need to apply for the CTO. Payouts are automatically computed and disbursed half-yearly to eligible employers.

For more information, you can refer to:
CPF Increase in Contribution Rates from 1 January 2022

CPF Transition Offset (CTO)