CPF Contributions and Benefits for Citizens and Singapore Permanent Residents (2023)

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The Central Provident Fund (CPF) is a mandatory savings scheme in Singapore that helps residents save for retirement, healthcare and housing. It is one of the most important financial programsSingapore Citizen, ySingapore Permanent Resident (PR).

The current monthly salary ceiling for CPF is S$6,000. From September 1, 2023 to 2026, the monthly salary ceiling for CPF will be gradually increased in four steps to S$8,000. The adjustment gave employers and employees enough time to adjust to the new rules.

CPF Contributions and Benefits for Citizens and Singapore Permanent Residents (2)

Image Source:Central Provident Fund (CPF)

However, it is important to note that the CPF annual salary cap of S$102,000 remains unchanged. This means that while more of a person's monthly income is eligible for CPF contributions, there is still a cap on total CPF contributions for a year. Employers and employees should take note of the gradual implementation of these changes and adjust their CPF contributions accordingly.

In this article, we explore Singapore's CPF system and how it works for both permanent residents and citizens.

CPF system overview

The Central Provident Fund system in Singapore consists of 3 accounts: Ordinary Account (OA), Medisave Account (MA) and Special Account (SA).

Ordinary Account (OA)

Ordinary accounts are primarily used for housing, education, and investment purposes. Contributions to OA can be used to buy a home, pay for education, and invest in stocks, bonds, and other financial instruments. OA has a lower interest rate compared to the other two accounts, but it is the only account that allows CPF members to withdraw their housing and education savings.

Medisave Account (MA)

Medisave Accounts are specially designed to help CPF members save on healthcare costs. Contributions to the MA can be used to pay for the medical expenses of members and their immediate family members. MA has a higher interest rate than OA, but lower than SA.

Special Account (SA)

Special accounts are primarily used for retirement savings. SA has a higher contribution rate than the other two accounts, and SA funds can only be used for certain specific purposes, such as investing in approved financial instruments, paying insurance premiums and buying a home. SA is an important account for provident fund members to accumulate savings for retirement, and it is especially useful for those who do not have other retirement savings plans.

CPF Contribution Rates for Singapore Citizens and Permanent Residents

CPF contribution rates are slightly different for citizens and Singapore permanent residents. Currently, the third-year provident fund contribution rate for citizens and PRs under the age of 55 is 37% of their total monthly salary, which is 17% for employers and 20% for employees. However, the contribution rate of PR in the first year and the second year is different. Below is the breakdown percentage chart:

For Singapore Permanent Residentsthe first yearthe second year
by the employer (% of salary)per employee (% of salary)by the employer (% of salary) per employee (% of salary)
Graduate Employees and Employers45915
Full-time employers and graduate employees1751715
complete employer and employee17201717

For employees aged 55 or over, CPF contribution rates are lower, depending on age. Below is the breakdown percentage chart:

Employee age (years)Contribution rates from January 1, 2023 (monthly salary > $750)
by the employer (% of salary)per employee (% of salary)all (% of salary)
55 and under172037
55 to over 60 years old14.51529.5
60 to 65+119.520.5
65 to 70+8.5715.5
over 70 years old7.5512.5

Withdraw and use provident fund

CPF savings can be used for a variety of purposes including buying a home, healthcare costs and retirement. However, there are certain rules and restrictions on the withdrawal and use of provident fund savings. For example, CPF savings can only be used to buy residential or private residential properties approved by the Housing and Development Board (HDB) that meet certain criteria. CPF savings can also be used to pay for healthcare for you, your spouse and your dependents.

CPF savings can only be fully withdrawn when you reach the age of 55, and a portion of your savings must be used to purchase an annuity that provides monthly contributions for life. The remaining savings can be withdrawn in one go or deposited into a provident fund account to earn interest.

Schemes and Provident Fund Schemes

There are various CPF programs and programs that can help permanent residents and citizens save more for retirement, healthcare and housing. One of the programs isCentral Provident Fund Investment Scheme (CPFIS), which allows you to invest your CPF savings in approved financial instruments such as insurance products, fixed deposits, shares, bonds and investment trusts. CPFIS is designed to help you achieve higher returns on your CPF savings, but there are some risks and limitations.

Another program isCPF Retreat Summary Schedule (RSS), which offers lifetime monthly payments once you turn 65. You can apply to start receiving payments any time after you turn 65. If you do not choose to start early, payments will automatically start at 70. RSS is designed to provide a steady stream of income during retirement and can be used to supplement your other sources of income such as a CPF life plan or personal savings.

Provident Fund Life PlanIt is another important item under the provident fund system. This is a life annuity with monthly payments for life starting at age 65. If you have S$60,000 in your retirement savings, you will be automatically enrolled in the plan. If you're not automatically included, you can enroll when you're ready to start receiving payments, anytime between age 65 and one month before you turn 80. A CPF life plan is designed to provide a steady stream of income during retirement, saved by your CPF.


in conclusion

Singapore's CPF system is a major savings scheme that helps permanent residents and citizens save for retirement, healthcare and housing. While the contribution rates for permanent residents and citizens are slightly different, the CPF system offers various schemes and schemes to help both groups save more and achieve their financial goals. It is important to understand the rules and limitations of withdrawing and using CPF savings, as well as the risks and limitations of various CPF schemes and schemes.

becomePeople's Republic of SingaporeIt is a smart investment for those looking to maximize their CPF savings and enjoy benefitsBenefits of Living in Singapore.With the Central Provident Fund System to help you save for your future needs, taking the first step towards permanent resident status can put you on the path to a secure and comfortable retirement.

if you are consideringrequest pr, it is important to have a clear understanding of the immigration process and requirements. that's oneExperienced Immigration Agencywill be of great help. We can guide you through the process, from assessing your qualifications to preparing your application and providing ongoing support. To learn more about how we can help you, read our AboutWhy should you consider hiring an immigration company?.

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