Compulsory and voluntary MediSave contributions
Self-employed persons who may also be employees are allowed relief on contributions made to their CPF accounts to reduce tax payable.
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Qualifying for CPF relief
To qualify, the self-employed person (who may also be an employee) must have contributed to any of the following in the year preceding the Year of Assessment (YA):You will be automatically allowed self-employed CPF relief if you have assessable net trade income.
Amount of CPF relief
CPF annual limit for self-employed persons
| YA | 2013 to 2015 | 2016 | 2017 to 2025 |
|---|---|---|---|
Net trade income ceiling | $85,000 | $85,000 | $102,000 ($6,000^ x 17 mths) |
CPF contribution rate | 36% | 37% | 37% |
CPF annual limit | $30,600 | $31,450 | $37,740^ (37% x $6,000 x 17 mths) |
^ As announced in Budget 2023, the current CPF monthly salary ceiling of $6,000 will be increased to $8,000 in four phases starting from 1 Sep 2023.
| Period | CPF monthly salary ceiling |
| 1 Sep 2023 to 31 Dec 2023 | $6,300 |
| 1 Jan 2024 to 31 Dec 2024 | $6,800 |
| 1 Jan 2025 to 31 Dec 2025 | $7,400 |
| On or after 1 Jan 2026 | $8,000 |
Notwithstanding the increases to the CPF monthly salary ceiling starting from 1 Sep 2023, the CPF annual salary ceiling will remain at $102,000. The CPF annual limit will also remain at $37,740 (37% x $102,000).
CPF contributions by a self-employed person
You are a self-employed person who has made compulsory MediSave contributions and voluntary CPF contributions in 2024.
For YA 2025, your tax relief for your MediSave and voluntary CPF contributions will be capped at the lowest of:
- 37% of your net trade income assessed; or
- CPF annual limit of $37,740; or
- Actual amount contributed by you in 2024.
No CPF relief will be allowed in respect of your compulsory MediSave or voluntary CPF contributions made in 2024 if you have no assessable net trade income for YA 2025.
CPF contributions by a self-employed person who is also an employee
You are an employee as well as a self-employed person who has made the following contributions in the same year:
- Compulsory CPF contributions as an employee;
- Compulsory MediSave contributions as a self-employed person; and
- Voluntary CPF contributions.
If your total compulsory CPF contributions as an employee and your compulsory MediSave contributions as a self-employed person is less than the CPF annual limit for self-employed persons, your tax relief for the voluntary CPF contributions will be capped at the prevailing CPF contribution rate for the year.
If your total compulsory CPF contributions as an employee and compulsory MediSave contributions as a self-employed person is more than the CPF annual limit for self-employed persons, no tax relief will be allowed for your voluntary CPF contributions, as the total compulsory CPF contributions as an employee and compulsory MediSave contributions as a self-employed has exceeded the CPF annual limit.
Claiming relief
CPF relief is allowed based on the date of payment. For example, to claim for the CPF relief in YA 2025, you must have made the contribution by 31 Dec 2024.
If you have made MediSave contributions or voluntary CPF contributions during the year, the tax relief will be automatically allowed in the following year.
For each YA, a personal income tax relief cap of $80,000 applies to the total amount of all tax reliefs claimed (including any tax relief on voluntary CPF contributions made).
There will be no refund for accepted voluntary CPF contributions. Please evaluate whether you would benefit from tax relief on your voluntary CPF contributions before you make an informed decision accordingly.
There will be no refund for accepted voluntary CPF contributions. Please evaluate whether you would benefit from tax relief on your voluntary CPF contributions before you make an informed decision accordingly.
FAQs
Can I obtain a refund of the voluntary CPF contributions I made if the total amount of tax relief which I can claim is more than $80,000, even without any tax relief on voluntary CPF contributions I made?
There will be no refund for accepted voluntary CPF contributions. As such, please note the overall personal income tax relief cap and evaluate whether you would benefit from the tax relief on your voluntary CPF contributions before you make an informed decision accordingly.
Can I limit my MediSave contributions as a self-employed person if I have already made CPF contributions as an employee?
If you have a yearly net trade income of more than $6,000, you have to make contributions to your MediSave account. However, if your total employment income (excluding additional wages*) exceeds 12 times the monthly salary ceiling for ordinary wages for that year, you can apply to CPF Board to limit your MediSave contributions as a self-employed person together with supporting documents.
For more information on the qualifying conditions to limit your MediSave contributions and the required supporting documents, please visit CPF Board's website.
*Additional wages are wage supplements which are not granted wholly and exclusively for the month. Examples are the annual bonus, leave pay, incentive and other payments made at intervals of more than a month.