At Unity Budget 2020, the Government announced:

(a) Senior Worker Support Package (which includes SEC and CTO) to support employers in implementing the key recommendations by the Tripartite Workgroup on Older Workers on increasing the Retirement Age, Re-employment Age, and CPF contribution rates of senior workers; and

(b) EEC, a new wage offset scheme to support the employment of persons with disabilities.

What is the SEC, EEC and CTO?

Senior Employment Credit (SEC)

Under the SEC, the Government provides wage offsets to help employers that employ Singaporean workers adjust to the higher Retirement Age and Re-employment Age. Higher support will be given for the older age bands.

For 2023 to 2025, the wage offset applies to Singaporean workers aged 60 and above and earning up to $4,000 per month. For wages paid between 1 Jan 2023 and 31 Dec 2025, employers will receive up to 8% of the wages paid to these eligible workers, depending on their age and wage.

For 2021 and 2022, the wage offset applies to Singaporean workers aged 55 and above and earning up to $4,000 per month.

Enabling Employment Credit (EEC)

To support the employment of persons with disabilities, the EEC will be given to employers that hire local employees with disabilities aged 13 and above and earning below $4,000 per month.

The EEC provides a wage offset of up to 20% of the employees’ monthly income, capped at $400 per month for each employee.

In addition, employers hiring local employees with disabilities who have not been working for at least six months will receive up to additional 20% wage offset, capped at $400 per month for each employee, for the first nine months of employment1.

The EEC will be available until 2025.

1The EEC was enhanced in 2023, with the additional wage offset increasing from 10% to 20%, and a cap of $400/month instead of $200/month. The support duration was also extended from 6 to 9 months.

CPF Transition Offset (CTO)

To alleviate the rise in business costs due to the increase in CPF contribution rates for senior workers, the Government will provide employers with a transitionary wage offset equivalent to 50% of each year's increase in employer CPF contribution rates for every Singaporean and Permanent Resident worker they employ aged above 55 to 70.

The offset to employers will be based on employees’ monthly incomes2 paid up to the CPF salary ceiling.

2Gross monthly wages include employee CPF contributions, but exclude employer CPF contributions.

 

Who qualifies for the SEC, EEC and CTO?

SECEECCTO
All employers that employ employees (Singapore Citizens) aged 60 years and above, earning a monthly wage of up to $4,000 and have made timely mandatory CPF contributions for the employee will qualify for the payout for 2023 to 2025.All employers that employ persons with disabilities (Singapore Citizens and Permanent Residents) aged 13 and above, earning a monthly wage of below $4,000 and have made timely mandatory CPF contributions for the employee will qualify for the payout.All employers that employ local employees (Singapore Citizens and Permanent Residents) aged above 55 to 70 and have made timely mandatory CPF contributions for the employee will qualify for the payout.

Wages paid to business owners3 or employers trading in their own personal capacity4 will not be eligible for the SEC, EEC and CTO even if they made CPF contributions for themselves through their entity.

3Business owners are defined as follows:
a. Sole proprietor of a sole proprietorship
b. Partners of a partnership (including general partnerships, limited liability partnerships and limited partnerships); and
c. Both a shareholder and director of a company. The definition of director is as set out in Section 4(1) of the Companies Act. For companies limited by guarantee, this applies to employees who are both members and directors of the company.

4Employers trading in their own personal capacity include, but are not limited to, hawkers who do not have UEN, and employers hiring local personal drivers or local domestic helpers.

Local government agencies, International Organisations and businesses not registered in Singapore do not qualify for the schemes.

See the full employer exclusion list

  1. Local Government Agencies including Organs of State, Ministries and Departments, Statutory Boards
  2. Government and Government-Aided Schools
  3. PA Services and Grassroot Units
  4. High Commissions, Embassies, Trade Offices, Consulate
  5. Unregistered Local/Foreign Entities
  6. Foreign Military Units
  7. Representative offices of:
    1. Foreign companies
    2. Foreign Government Agencies
    3. Foreign Trade Associations/ Foreign Chambers/ Foreign Non-profit Organisations
    4. Foreign Law Practices
  8. Bank Representative Offices/Insurance Representative Officers/Other Financial Representative Offices (registered with MAS); News Bureaus (which are representative offices);
  9. International Organisations
  10. Entities which pay CPF but are not registered in Singapore

How do employers apply for the payouts?

Employers do not need to apply for the payouts. IRAS will notify eligible employers regarding the amount payable to them electronically based on their notification preferences for Income Tax/GST, as updated with IRAS. To receive timely notifications when your notices are ready for viewing, please update your notification preferences in myTax Portal at IRAS website.

When will employers receive the payouts?

For wages paid from January to June, employers will receive the payout in September the same year. For wages paid from July to December, employers will receive the payout in March the following year.

How do employers receive the payouts?

In line with Singapore’s Smart Nation efforts, all payouts will be disbursed through GIRO or PayNow Corporate. No cheques will be issued for the payouts.

Payouts will automatically be credited to employers' GIRO bank account for Income Tax/GST. For those without GIRO accounts, the payout will be credited to their bank account that is registered with PayNow Corporate. Employers who are not already on these direct crediting modes have to sign up for these modes – GIRO or PayNow Corporate5 to receive their payouts.

5Organisations can sign up for PayNow Corporate by linking their organisation’s UEN (without suffix) [e.g. ROC (2019XXXXXA), ROB (531XXXXXA), UEN (T19LLXXXXA)] to their bank account via internet banking. The nine banks participating in PayNow Corporate are United Overseas Bank, DBS Bank/POSB, OCBC Bank, Citibank, HSBC, Maybank, Standard Chartered Bank, Bank of China and Industrial and Commercial Bank of China Limited. For assistance, please approach these banks.

How is each payout computed?

Senior Employment Credit (SEC)

For wages paid from 1 January 2021 to 31 December 2022, employers will get up to 8% of the wages paid to Singaporean workers aged 55 and above, and earning up to $4,000 per month. For wages paid from 1 January 2023 to 31 December 2025, employers will get up to 8% of the wages paid to Singaporean workers aged 60 and above, and earning up to $4,000 per month.

Monthly SEC payouts per employee for 2021:

Age GroupUp to $3,000  >$3,000 to <$4,000
Aged between 55 and 59
(>=55 yrs and <60 yrs)
2% of wage$240 – (0.06*wage)
Aged between 60 and 64
(>=60 yrs and <65 yrs)
3% of wage
$360 – (0.09*wage)
Aged between 65 and 66
(>=65 yrs and <67 yrs)
5% of wage$600 – (0.15*wage)
Aged 67 and above
(>=67 yrs)
8% of wage$960 – (0.24*wage)

Monthly SEC payouts per employee for 2022:

Age GroupUp to $3,000
>$3,000 to <$4,000
Aged between 55 and 59
(>=55 yrs and <60 yrs)
1% of wage$120 – (0.03*wage)
Aged between 60 and 64
(>=60 yrs and <65 yrs)
3% of wage$360 – (0.09*wage)
Aged between 65 and 66
(>=65 yrs and <67 yrs)
5% of wage$600 – (0.15*wage)
Aged 67 and above
(>=67 yrs)
8% of wage$960 – (0.24*wage)

Monthly SEC payouts per employee for 2023:

Age GroupUp to $3,000
>$3,000 to <$4,000
Aged between 60 and 64
(>=60 yrs and <65 yrs)
3% of wage$360 – (0.09*wage)
Aged between 65 and 67
(>=65 yrs and <68 yrs)
5% of wage$600 – (0.15*wage)
Aged 68 and above
(>=68 yrs)
8% of wage$960 – (0.24*wage)

Monthly SEC payouts per employee for 2024 and 2025:

Age GroupUp to $3,000
>$3,000 to <$4,000
Aged between 60 and 64
(>=60 yrs and <65 yrs)
2% of wage$240 – (0.06*wage)
Aged between 65 and 67
(>=65 yrs and <68 yrs)
4% of wage$480 – (0.12*wage)
Aged 68 and above
(>=68 yrs)
7% of wage$840 – (0.21*wage)

Enabling Employment Credit (EEC)

The EEC will be paid to employers of local persons with disabilities (PwDs) aged 13 and above, and earning up to $4,000 per month. In addition, employers who hire persons with disabilities who have not been in employment for the past six months will receive an additional wage offset for the first nine months of employment.

Monthly Wage of Employee with disability ($)PayoutAdditional payout if employee was not employed for the past six months, for up to the first nine months of employment only
≤ $200020% of wage20% of wage
> $2,000 to $3,000$400$400
> $3,000 to $4,000$1,600 - 0.4*wage$1,600 - 0.4*wage

 Note: Employees eligible for EEC will not be eligible for the SEC (i.e. not stackable).

CPF Transition Offset (CTO)

The Government will provide employers with a transitory wage offset equivalent to half of the increase in employer CPF contribution rates for senior workers. The CTO is calculated based on employee's wages paid up to the current CPF salary ceiling.

CTO for Employers in 2022:

Age BandsIncrease in Employer CPF Contribution from 1 January 2022CTO for Employers in 2022
≤ 55No change
> 55 to 60+ 1% point0.5% point
> 60 to 65+ 1% point0.5% point
> 65 to 70+ 0.5% point0.25% point
> 70No change

CTO for Employers in 2023:

Age BandsIncrease in Employer CPF Contribution from 1 January 2023CTO for Employers in 2023
≤ 55No change
> 55 to 60+ 0.5% point0.25% point
> 60 to 65+ 1% point0.5% point
> 65 to 70+ 0.5% point0.25% point
> 70No change

CTO for Employers in 2024:

 

Age BandsIncrease in Employer CPF Contribution from 1 January 2024CTO for Employers in 2024
≤ 55No change
> 55 to 60+ 0.5% point0.25% point
> 60 to 65+ 0.5% point0.25% point
> 65 to 70+ 0.5% point0.25% point
> 70No change

CTO for Employers in 2025:

 

Age BandsIncrease in Employer CPF Contribution from 1 January 2025CTO for Employers in 2025
≤ 55No change
> 55 to 60+ 0.5% point0.25% point
> 60 to 65+ 0.5% point0.25% point
> 65 to 70No changeN.A
> 70No change

As announced at Budget 2024, the CTO will be provided to employers for the 2025 increase in senior workers’ CPF contribution rates.

How do employers submit request for breakdown of the payouts?

You may put up a request for a detailed breakdown of the individual amount of your employees.

Can employers appeal to qualify for the schemes?

For SEC and EEC, employers have up to 2 months from the month of payout to lodge an appeal. For instance, if the payout is in the month of March, employers must complete the SEC appeal form (PDF, 382KB) or EEC appeal form (PDF, 381KB) (where applicable) and send it via email to [email protected] by 31 May. Late appeals i.e. those received after the 2-month window will not be considered.

For CTO, employers have up to 2 months from the month of payout to lodge an appeal. For instance, if the payout is in the month of March, employers must complete the CTO appeal form (PDF, 412KB) (where applicable) and send it via email to [email protected] by 31 May. Late appeals i.e. those received after the 2-month window will not be considered.

 

How will the Government detect abuse of the schemes?

The Government takes a serious view on any attempt to abuse the scheme. Offenders may have their payouts denied and can be charged under Section 420 of the Penal Code, where they may face up to 10 years of imprisonment and a fine.

Businesses or individuals who wish to report to IRAS any malpractices or potential abuses of the schemes may do so via email to [email protected] or online at go.gov.sg/schemereport. IRAS will ensure that the identities of informants are kept strictly confidential.

Contacting IRAS

If there are queries that have not been addressed on this site, please send us an enquiry via FormSG. You can also chat with us online or call us at 6351 3288 (8 a.m. - 5 p.m. from Mon to Fri, excluding public holidays).

FAQs

A. Claiming and computing

How is the payout computed for employees with two or more employers?

Each employer will receive the payout based on the wage that they paid to that employee.

B. Payment Mode

Can I instruct IRAS to make the payout to a third party?

No. The payout can only be paid to the employer which made CPF contributions for its employees.

Why is IRAS not issuing cheques for the schemes?

In line with Singapore’s Smart Nation efforts, all payouts will be disbursed through GIRO or PayNow Corporate. ePayment is also the fastest way for employers to receive money from the Government.

C. Declining and Returning Payout

Can I decline the payout if I do not need the support?

Yes. You can email to [email protected] and indicate whether you are declining the next payout or all future payout of the specific scheme(s).

How do I decline SEC, EEC and/or CTO payouts?

If you wish to be excluded from current and all future SEC, EEC  and/or CTO payouts, please sign up using the Decline SEC EEC CTO form.

Returning SEC payouts
To return a SEC payout that you have received, please do so via internet banking fund transfer. IRAS’ bank account details are as follows:

Payee: IRAS-SEC SUB-FUND
Account Type: DBS Current Account
Account No.: 072-033405-1
DBS Swift Code: DBSSSGSG

To facilitate the processing of your return, please indicate your business name and purpose (e.g. ABC Pte. Ltd. Decline SEC, EEC  and/or CTO) under the “Beneficiary Reference / Purpose of Payment / Remittance Information / Payment Details” field.

Returning EEC payouts
To return a EEC payout that you have received, please do so via internet banking fund transfer. IRAS’ bank account details are as follows:

Payee: IRAS-EEC SUB-FUND
Account Type: DBS Current Account
Account No.: 072-033407-8
DBS Swift Code: DBSSSGSG

To facilitate the processing of your return, please indicate your business name and purpose (e.g. ABC Pte. Ltd. Decline SEC, EEC  and/or CTO) under the “Beneficiary Reference / Purpose of Payment / Remittance Information / Payment Details” field.

Returning CTO payouts
To return a CTO payout that you have received, please do so via internet banking fund transfer. IRAS’ bank account details are as follows:

Payee: Commissioner of Inland Revenue
Account Type: DBS Current Account
Account No.: 001-023871-0
DBS Swift Code: DBSSSGSG

To facilitate the processing of your return, please indicate your business name and purpose (e.g. ABC Pte. Ltd. Decline SEC, EEC  and/or CTO) under the “Beneficiary Reference / Purpose of Payment / Remittance Information / Payment Details” field.

Please do not send cheques for the return of SEC, EEC and CTO.

D. Other Questions

Do I get taxed on the payout?

The payout will be taxable in the year of receipt.

SEC, EEC and CTO are wage offsets to support the employment of senior workers and persons with disabilities. Hence the payout is considered revenue in nature as it is directly connected to their businesses to defray operating costs.

Individuals (including sole proprietors) and partnerships are not required to declare the scheme payouts received in their income tax returns (Form B/B1 or Form P) as this will be automatically included by IRAS in their tax assessments for the relevant YA.

Companies are however, required to declare the payout received in their income tax return (Form C/Form C-S) for the relevant YA.

I have hired a new local PwD. How will I know if my new local hire will qualify for EEC support as PwD?

IRAS will automatically assess your eligibility for the EEC, including enhanced support for PwDs. The PwD must be supported by SG Enable to qualify. Disabilities covered by SG Enable are autism, intellectual disability, physical disability, deafness/ hard of hearing and visual impairment. If you have queries on the disabilities as covered by SG Enable, you may refer to www.sgenable.sg or contact SG Enable at: 1800-8585 885.