Why Do Singapore Employers Owe So Many Payroll Levies?
How can Singapore employers keep payroll costs and statutory deductions on schedule? In this infographic, we set out the seven payroll levies and contributions Singapore employers must calculate and remit each month — the same obligations our payroll services in Singapore manage for clients daily.
For Singapore Citizens and qualifying Permanent Residents aged 55 and below with monthly wages above S$750, employer CPF contributions are generally 17% of wages. Companies newly incorporated in Singapore soon discover that payroll levies extend further — to the Skills Development Levy, the Foreign Worker Levy and four community fund deductions — each with its own rates, wage ceilings and deadlines.
The figures also move: the CPF ordinary wage ceiling rose again on 1 January 2026. Miscomputing any item means late-payment interest, penalties and disputes with employees.
Singapore payroll levies and contributions snapshot
| Item | Who it covers | Key rate or basis |
|---|---|---|
| CPF contributions | Singapore Citizens and Permanent Residents | 17% employer rate for staff aged 55 and below; first S$8,000 of ordinary wages |
| Skills Development Levy | Every employee, local or foreign | 0.25% of total monthly wages; S$2 to S$11.25 monthly |
| Foreign Worker Levy | Work Permit and S Pass holders | S Pass: S$650 monthly; Work Permit examples: S$250 to S$900 monthly |
| CDAC Fund | Eligible Chinese Singapore Citizens and Permanent Residents | S$0.50 to S$3 monthly, based on total monthly wages |
| MBMF | Eligible Muslim employees | S$3 to S$26 monthly, based on total monthly wages; no S$10,000 wage ceiling |
| SINDA Fund | Eligible working Indian staff | S$1 to S$30 monthly, based on wage band |
| Eurasian Community Fund | Eligible Eurasian employees | S$2 to S$20 monthly, based on total monthly wages |
1. How Do Central Provident Fund Contributions Work?
Employers contribute 17% of monthly wages for eligible employees aged 55 and below as the standard rate; Permanent Residents on graduated transition rates may differ. CPF applies to Singapore Citizens and Permanent Residents, with employee contributions of 20% in the youngest band. Senior-worker employer rates rose from 1 January 2025. From 1 January 2026, only the first S$8,000 of monthly ordinary wages attracts CPF contributions. CPF contributions for a month are due to the CPF Board by the 14th of the following month, or the next working day if the 14th falls on a weekend or public holiday.
2. How Does the Skills Development Levy Work?
The Skills Development Levy (SDL) is 0.25% of each employee's monthly total wages. The levy applies to every worker, local or foreign. It is payable on the first S$4,500 of wages, with monthly contributions between S$2 and S$11.25 per head. Administered by SkillsFuture Singapore, the SDL is collected by the CPF Board alongside CPF contributions and funds national upskilling programmes.
3. How Does the Foreign Worker Levy Work?
Foreign Worker Levy rates vary by pass type, sector, skill tier and the company's quota position under the dependency ratio ceilings. This is one of the payroll levies Singapore employers must budget for. Rates checked: 21 October 2026. S Pass holders attract a S$650 monthly levy. Work Permit levy rates in Ministry of Manpower tables range from S$250 to S$900 a month. Unlike CPF, the levy is paid solely by the employer. It cannot be recovered from the worker's wages.
4. CDAC Fund Deductions
CDAC contributions range from S$0.50 to S$3 monthly, based on total monthly wages. Rates checked on 21 October 2026 against the CPF Board community fund schedule.
- S$2,000 or less: S$0.50
- More than S$2,000 to S$3,500: S$1
- More than S$3,500 to S$5,000: S$1.50
- More than S$5,000 to S$7,500: S$2
- More than S$7,500: S$3
Eligible Chinese Singapore Citizens and Permanent Residents can opt out. Employers deduct contributions from participating employees' salaries and remit them via the CPF Board. The deductions fund community welfare programmes.
5. MBMF Payroll Contributions
Eligible Muslim employees contribute S$3 to S$26 monthly to the Mosque Building and Mendaki Fund (MBMF), based on total monthly wages. Rates checked on 21 October 2026 against the CPF Board community fund schedule; no S$10,000 wage ceiling applies. Employers deduct the contribution from eligible Muslim employees' salaries and remit it alongside CPF payments, funding mosque construction, upkeep and MENDAKI education programmes.
6. Who Pays SINDA Fund Contributions and How Much Are They?
SINDA has served Singapore's Indian community since its establishment in 1991. Eligible working Indian Singapore Citizens, Permanent Residents and Employment Pass holders are assigned a tiered monthly contribution unless they opt out. Rates checked on 21 October 2026 against the CPF Board community fund schedule.
- S$1,000 or less: S$1
- More than S$1,000 to S$1,500: S$3
- More than S$1,500 to S$2,500: S$5
- More than S$2,500 to S$4,500: S$7
- More than S$4,500 to S$7,500: S$9
- More than S$7,500 to S$10,000: S$12
- More than S$10,000 to S$15,000: S$18
- More than S$15,000: S$30
Employers must identify eligible Indian staff and deduct the correct amount. They remit it with CPF payments, so contributions flow into education bursaries and family support schemes.
7. Eurasian Community Fund
Eligible Eurasian Singapore Citizens and Permanent Residents contribute S$2 to S$20 monthly to the Eurasian Community Fund (ECF), based on total monthly wages. Rates checked on 21 October 2026 against the CPF Board community fund schedule. Deduction amounts rise with wages in bands, withheld from eligible Eurasian employees' salaries and remitted with CPF contributions. The CPF Board then transfers collections to the Eurasian Association, which channels them into social, educational and cultural programmes. As with the other community funds, the employer handles deduction and remittance.
Which Payroll Levies Does Your Company Pay?
Our payroll specialists compute and remit all seven levies accurately, every month.
Frequently Asked Questions
No. CPF is payable only for Singapore Citizens and Permanent Residents. Foreign workers on Work Permits, S Passes or Employment Passes are exempt, though they still attract the Skills Development Levy.
Yes. The SDL applies to every employee, local or foreign, at 0.25% of monthly total wages, payable on the first S$4,500 and ranging between S$2 and S$11.25 per worker monthly.
No. The levy is an employer-only cost under Ministry of Manpower rules and cannot be deducted from the employee's salary.
CDAC and SINDA contributions apply unless the eligible employee opts out; MBMF and ECF contributions are compulsory salary deductions once an employee meets the relevant community and wage criteria. Employers remit all four with CPF payments.
CPF contributions for a month are due by the 14th of the following month, or the next working day if that date falls on a weekend or public holiday. Enforcement action, including late-payment interest of 1.5% a month on shortfalls, can follow if payment is not made.
Abigail Yu
Director
Abigail Yu oversees executive leadership at 3E Accounting Group, leading operations, IT solutions, public relations, and digital marketing to drive business success. She holds an honors degree in Communication and New Media from the National University of Singapore and is highly skilled in crisis management, financial communication, and corporate communications.
