CPF question

[little goose]

Hihi,

brief question: I am on EP but wanna switch to PR status (that way, i can still stay in SG should i decide to give up current job).
However, I have heard that a fraction of my monthly salary is withdrawn to the CPF every month. The positive side is that my employer contributes also to my CPF. BUT, does that mean that the amount contributed by him will just be deducted from my year-end bonus (since in net effect, it has become more "expensive" to hire me..)? Reason for asking this question is that I work in the finance industry, where the year-end bonus is normally higher than other industries...
Thanks for reading...wish u guys out there a belated merry Xmas

[pastrian.allac]

For my case, if I don't remember wrongly, during my first 2 years of PR status, my bonus isn't deducted for CPF. Only on the 3rd year, I encountered such deductions. I'm not sure is this a rule or my HR department has forgotten to do so (for the no-deduction during the 1st 2 years). I doubt it's the latter case though. In case you're still confused, I mean when your monthly CPF contribution has risen up to the same percentage as SG citizens (20% from your salary), then it's time your bonuses will be deducted off for the purpose. This is what I figured out though. Bonus is also part of what you earn throughout the year, so it should be subjected to CPF deductions.

[briceloh]

Check with your HR, they may offer u more updated answers.

[sundaymorningstaple]

Your cpf contributions are subject to a contribution rate determined by your status as a PR, e.g., 1st, 2nd & 3rd year. The contributions are limited to those percentages on a maximum income/month. This was 6,000/month but may be reduced if I'm not mistaken to 5,500/month this year and subsequently 5,000/month. If your salary is already above the maximum, then the month you draw your Bonus, you would not have any contibutions being deducted from your bonus. If you only made, say, 3K/mo with 1 month bonus, then you would have a total salary for that month of 6K, hence you would contribute on the whole amount. IF salary was 4K then with a 6K maximum you would not contribute on 2K of your bonus.

hope that helps.

sms

[Guest]

Thanks for all your answers! Really appreciated.
However, i am still stuck: Since i am in the finance industry and my year-end bonus can really vary tremendously (depending how the markets have done in the past 12 months), I really cannot figure out whether the bonus amount i receive is already "net" of the CPF deduction my employer paid to the CPF.

Put it simple, suppose i receive 4 months salary as a bonus. Does that mean that I actually SHOULD have received more, but its deducted with CPF payments, or are these 4 extra months of salary my "real" bonus amount....
thanks again!

[sundaymorningstaple]

your salary slip should show both your gross salary, cpf contributions (yours), and net pay. Should also show any allowances, overtime, other deductions etc., etc.

sms

[little goose]

sorry sms. the only thing i get from HR is letters of employment upon request and my bank account statement where the GIRO is booked. no monthly salary slip, bonus description...etc.
Is it legal anyways to have practices in Singapore like that?

[pastrian.allac]

I guess not all companies practise the salary slip part. But big organised companies do. Not sure if you could request your HR for one?

[sundaymorningstaple]

You can always check with your CPF account to see how much CPF was contributed during the month in question. From there, you can work backwards to arrive at the total contribution/employees amount. (you need to know what the employee/employer contribution %'s are)

Take this amount (employee contributions) and add it back into your net pay deposited into your account (provided no other deductions are present) then divide by your basic monthly salary. This, barring o/t and other pmts, should give you the total number of months salary received. Subtract 1 for the current months salary and voila! you have the number of months bonus received.

sms

[sundaymorningstaple]

little goose

just realized that guest & little goose are quite possibly not one and the same.

If you are, as you say, an EP holder, then you are not required to contribute CPF by law.

If your employers are contributing, which is possible, then yes, in all probability the employers CPF contribution is being deducted from your year-end bonus as otherwise, it would be like a raise or additional bonus. If your employer is paying into your CPF then all of the CPF is still taxable. Whereas, if you are a PR it is not taxable.

sms