The CPF Contribution Relief is one of the most significant personal tax reliefs available to Singapore taxpayers. Whether you are an employee or self-employed, understanding how this relief works can help you reduce your taxable income for Year of Assessment (YA) 2025.
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📌 What Is CPF Contribution Relief?
The Central Provident Fund (CPF) Contribution Relief is granted to Singapore tax residents who make CPF contributions. The relief helps lower your taxable income by recognising your retirement savings efforts.
CPF is mandatory for employees, but self-employed individuals can also contribute voluntarily, especially to their MediSave accounts.
✅ CPF Contribution Relief for Employees
For employees, CPF contributions are automatically deducted from your salary each month. The relief amount is based on your ordinary wages and additional wages subject to CPF.
- Automatically included in your IRAS tax assessment—no separate claim required.
- Relief is capped at the CPF Annual Limit of $37,740 for combined employer and employee contributions.
- Contributions above the limit are not eligible for relief.
💼 CPF Contribution Relief for Self-Employed
If you are self-employed in Singapore, CPF contributions are not mandatory for the Ordinary Account but are compulsory for your MediSave account if your annual net trade income exceeds $6,000.
- You can claim CPF relief based on the actual amount contributed to your MediSave account.
- Voluntary CPF contributions to the Special and Ordinary Accounts may also qualify for tax relief, subject to caps.
- The maximum relief is based on the Self-Employed CPF Contribution Rates set by CPF Board.
📊 CPF Annual Limit and Tax Implications
The CPF Annual Limit for YA 2025 remains at $37,740. This limit applies whether you are an employee or a self-employed person making voluntary contributions.
Any contributions above this limit will not earn tax relief and may be refunded to you by the CPF Board.
📝 How to Claim CPF Contribution Relief
- For employees, relief is automatically reflected in your tax return from employer CPF submissions.
- For self-employed individuals, log in to myTax Portal during filing and enter your MediSave and voluntary CPF contributions in the “Deductions, Reliefs and Rebates” section.
- Ensure that your contributions have been received by CPF Board before 31 December of the preceding year.
💡 Tax Planning Tips
- Maximise Voluntary Contributions: If you have room under the CPF Annual Limit, consider topping up before year-end.
- Combine with CPF Top-Up Relief: Cash top-ups to your Special or Retirement Account can earn separate tax relief in addition to CPF contributions.
- Plan Around Annual Limit: Avoid over-contributing as excess amounts do not qualify for relief.
📌 Final Thoughts
CPF Contribution Relief is a powerful tax-saving tool for both employees and self-employed individuals. By understanding the rules and contribution limits, you can strategically plan your CPF payments to enjoy both retirement security and lower taxes in Singapore.
