Employers are reminded to make CPF contributions for employees by 15 Jan 2018 to receive Wage Credit Scheme payouts
Employers of eligible Singaporean employees are reminded to make the full CPF contributions for these employees by 15 January 2018 in order to receive the fifth tranche of Wage Credit Scheme (WCS) payouts in March 2018.
To qualify for the fifth tranche of the WCS payout, employers must fulfil the following conditions:
- Have given Singaporean employees a gross monthly wage increase of at least $50 in 2017 and/or have sustained the gross monthly wage increases (at least $50) previously given to employees in 2016 and 2015; and
- Have paid the employees’ mandatory CPF contributions for 2017 wages to the CPF Board by 15 January 20181.
Employers do not need to apply to receive the WCS payouts. Eligible employers will receive letters from the Inland Revenue Authority of Singapore (IRAS) by March 2018 informing them of the amount of WCS payout they will be given. The payouts will be credited directly into the employers’ bank accounts or issued as cheques to employers.
The WCS forms part of the Transition Support Package announced in Budget 2013. It was introduced as a three-year scheme, supporting wage increases made over 2013 to 2015. In Budget 2015, to give businesses more time to adjust to rising wages in the tight labour market, the Government extended the WCS for two more years, over 2016 to 2017. Under this extended scheme, the Government co-funds 20% of the wage increases given to Singaporean employees earning a gross monthly wage2 of $4,000 and below. This allows businesses to free up resources for investments in productivity, and share the productivity gains with their employees.
Severe Penalties for Abusing Wage Credit Scheme
The Government takes a serious view of attempts to abuse the Wage Credit Scheme and offenders can be charged under Section 420 of the Penal Code for abusing the scheme, where they may face up to 10 years of imprisonment and a fine.
Ministry of Finance
Inland Revenue Authority of Singapore
1 Employers are required to make CPF contributions within 14 days from the end of each month for which CPF contributions are due. If the 14th day falls on a Saturday, Sunday or public holiday, the grace period will be extended to the next working day. Late payment interest will otherwise apply.
2 Gross monthly wage is defined as total wage of the employee paid by the employer in the calendar year (including basic salary, overtime pay and bonuses), divided by the number of months of CPF contribution.