These changes aim to support older workers in building sufficient retirement savings while ensuring the long-term sustainability of the CPF system in the face of evolving economic conditions and rising living costs.
For employers, these evolving contribution requirements highlight the importance of keeping payroll processes aligned with the latest regulatory updates while managing workforce costs effectively. Many organisations are therefore reviewing their HR operations, including engaging payroll outsourcing services in Singapore, to help ensure accurate CPF computations and compliance with statutory requirements. In addition, outsourcing your non-core business processes can streamline internal resources and allow businesses to focus on strategic priorities while responsive to regulatory developments.
CPF contribution rates for both employers and employees aged 55 to 70 have increased progressively by 0.5% to 1.5% across different phases since January 2023, as part of Singapore’s efforts to strengthen retirement adequacy for older workers.
Starting in January 2023, contribution rates for this age group were raised by up to one percentage point for both employers and employees. The adjustment was first announced by Finance Minister Lawrence Wong in his Budget 2022 speech on 18 February.
The initial phase of the increase was implemented in 2023. To help businesses manage the added costs, the Government introduced a one-year CPF Transition Offset, which covered half of the additional employer CPF contributions arising from the rate increase.
The second phase was implemented in January 2024, with employers receiving a similar offset support. Across these two phases, workers within this age group experienced a total increase of three to four percentage points in their CPF contribution rates, depending on the age band.
Subsequent adjustments were implemented in January 2025, with the final phase taking effect from January 2027 for employees aged above 55 to 65. These phased increases progressively raise CPF contribution rates for older workers, enabling them to build up higher retirement savings while allowing employers time to adapt to the higher contribution requirements.
| Employee's age (in years) | Current employee contribution rate | Current employer contribution rate | Employee contribution rate from 1st Jan 2027 | Employer contribution rate from 1st Jan 2027 |
| 55 and below | 20% | 17% | 20% | 17% |
| Above 55 to 60 | 18% | 16% | 19% | 16.5% |
| Above 60 to 65 | 12.5% | 12.5% | 13% | 13% |
| Above 65 to 70 | 7.5% | 9% | 7.5% | 9% |
| Above 70 | 5% | 7.5% | 5% | 7.5% |
Source: CPF Board
The CPF Ordinary Wage (OW) ceiling has also continued its phased increase since 2024, allowing employees earning above the previous ceiling to contribute more to their CPF accounts. Under this adjustment, the OW ceiling was raised progressively each year and has reached $8,000 from January 2026.
| CPF OW Ceiling | CPF annual salary ceiling | |
| From 1 Jan 2024 | $6,800 | $102,000 |
| From 1 Jan 2025 | $7,400 | |
| From 1 Jan 2026 | $8,000 |
Source: CPF website
Ordinary Wages (OW) refer to monthly recurring income such as basic salary and fixed allowances. Additional Wages (AW) refer to non-recurring payments such as bonuses.
The OW ceiling represents the maximum monthly wage amount subject to CPF contributions. As the ceiling increases, employees earning above the previous threshold will contribute CPF on a larger portion of their wages.
The annual salary ceiling caps the total amount of OW and AW that attracts CPF contributions within a year. As this ceiling remains at $102,000, the overall annual CPF contribution cap remains unchanged.
The Basic Retirement Sum (BRS) forms the foundation for monthly payouts under CPF LIFE, helping members cover their basic retirement expenses. Those who wish to receive larger monthly payouts may opt to set aside the Full Retirement Sum (FRS) or the Enhanced Retirement Sum (ERS), which are currently set at two times and three times the BRS respectively.
The BRS has been increasing progressively for cohorts turning 55 between 2023 and 2027.For members turning 55 in 2026, the BRS is $110,200. This will increase further to $114,100 for members turning 55 in 2027.
In view of rising living costs and longer life expectancy, these adjustments aim to ensure that retirement payouts remain adequate over time.
With the updated figures, members who set aside the BRS at age 55 in 2027 can expect to receive close to $1,000 per month from age 65 under CPF LIFE. The payout amounts under the FRS and ERS will increase in tandem, providing members with the option of higher lifelong retirement income.
Year that members reach age 55 | ||||||
2022 (Previously announced) | 2023 | 2024 | 2025 | 2026 | 2027 | |
| Estimated monthly payouts provided by retirement sums at age 65^ | ||||||
| BRS | $850 | $870 | $900 | $930 | $950 | $980 |
| FRS | $1,570 | $1,620 | $1,670 | $1,730 | $1,780 | $1,840 |
| ERS | $2,300 | $2,370 | $2,450 | $2,530 | $2,610 | $2,690 |
| Retirement sums at age 55 | ||||||
| BRS | $96,000 | $99,400 | $102,900 | $106,500 | $110,200 | $114,100 |
| FRS | $192,000 | $198,800 | $205,800 | $213,000 | $220,400 | $228,200 |
| ERS | $288,000 | $298,200 | $308,700 | $319,500 | $330,600 | $342,300 |
Source: Annexe 3 of Budget 2022
^Assumes a male member on the CPF LIFE Standard Plan, commencing payouts at age 65. Figures are estimates based on prevailing mortality trends and interest rates.
Members are not required to top up their CPF accounts if they are unable to set aside the BRS.
Eligible seniors under the enhanced Silver Support Scheme will continue to receive additional government assistance of up to $1,080 per quarter, depending on their household circumstances.
The Workforce Income Supplement Scheme, first introduced in 2007, continues to support lower-wage workers by boosting their incomes and strengthening their CPF savings. The scheme was expanded to include younger workers aged 30 to 34. A minimum monthly income threshold of S$500 was also introduced to encourage part-time and casual workers to take on more regular employment.
Under the enhanced scheme, the maximum annual Workfare payouts are as follows:
This highest payout tier also applies to persons with disabilities, regardless of age.
If you would like to better understand how these CPF changes may affect your organisation’s payroll processes, compliance obligations or cost planning, Forvis Mazars can assist. Our team provides comprehensive payroll advisory and implementation support, helping organisations stay aligned with evolving regulatory requirements while maintaining efficient payroll operations.
Contact Forvis Mazars today to explore how tailored payroll solutions and strategic business support can help your organisation stay ahead of regulatory changes and focus on sustainable growth.
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