Compulsory MediSave Contributions

You must make compulsory contributions to your MediSave Account after you receive a Notice of Computation (NOC) of CPF Contributions from IRAS if:

  1. You are a self-employed person;
  2. You are a Singapore Citizen or Permanent Resident; and
  3. Your net trade income# is more than $6,000.

#Net trade income is your gross trade income minus all allowable business expenses, capital allowances and trade losses.

Amount of Compulsory MediSave Contributions

The MediSave amount that you have to contribute yearly depends on your:

  • age; and
  • net trade income.

The MediSave contribution amount is generally a percentage of your total business trade income subject to a maximum cap.

MediSave Contribution Rates for Year 2021

Yearly Net Trade Income Age as at 1 Jan 2021         
  Below 35 35 to below 45   45 to below 50 years 50 years and above
 Above $6,000 to $12,0004%4.5%5%  5.25%
 Above $12,000 to $18,0004% to 8% 4.5% to 9%5% to 10% 5.25% to 10.5% 

Above $18,000

8%9% 10% 10.5% 

Maximum

$5,760$6,480$7,200$7,560 

Example: 37 year-old with net trade income of $65,000 in 2021

Age as at 1 Jan 2021
37 years old
Net Trade Income in 2021$65,000
MediSave Contribution Rate9% 
Maximum Cap for Age Group$6,480 
Amount of MediSave Contribution Payable$5,850 
Lower of $6,480 or (9% x $65,000) 

For more MediSave contribution rates and Self-Employed MediSave Contribution Calculator, please refer to the CPF Board website.

Making Compulsory MediSave Contributions

Contributions must be made within 30 days after the date of issue of the Notice of Computation (NOC) of CPF Contributions from IRAS. The NOC would state clearly how much you have to contribute.

IRAS sends the NOC after assessing your income i.e. after you have filed your income tax return and received your Notice of Assessment. You do not have to wait for the NOC to make your contributions. Contributions may be made throughout the year.

Alternatively, you may also make your contributions through GIRO Instalment Plans. The payments will be according to the instalment plan issued by the Central Provident Fund (CPF) Board. Please contact the CPF Board directly to arrange for the payment of your MediSave.

 

Voluntary Contributions to MediSave Account (VC-MA)

You may also make voluntary contributions to your MediSave account and claim tax reliefs to lower your taxes.

Tax Relief for Voluntary Contributions made on or before 31 Dec 2021

You may claim tax relief for your voluntary MediSave contributions if:

  • You are a Singapore Citizen or Permanent Resident;
  • You have made voluntary contributions to your MediSave account in the previous year; and
  • You derived any source of income (e.g. from rental, director's fees, etc.) in the year you made the voluntary contributions.

Amount of Tax Relief VC-MA (Up to YA 2022)

The amount of tax relief is the lowest of the following:

  1. Voluntary cash contribution directed specifically to your MediSave Account;
  2. Annual CPF contribution cap* for the year, less Mandatory Contribution (refers to compulsory contribution by employee and his/her employer, and compulsory MediSave Account for self-employed individuals); or
  3. Prevailing Basic Healthcare Sum (BHS), less the balance in MediSave Account before you make the voluntary cash contribution.

*Capped at $37,740 with effect from 1 Jan 2016.

Amount of Tax Relief VC-MA (From YA 2023 onwards) New!

To make it simpler for individuals to make top-ups to their MediSave Accounts without having to determine whether they have reached the Annual CPF contribution cap for the year and for parity with the Retirement Sum Topping-Up scheme, the following changes take place for CPF cash top-ups made by all individuals on or after 1 Jan 2022:

  • The tax relief for cash top-up to Retirement Account and Special Account is expanded to include cash top-ups made to an individual’s own MediSave Account and to his/ her family members’ MediSave Accounts (not allowed by CPF Board if the recipient is a self-employed person (SEP) with outstanding MediSave liabilities)
  • The maximum CPF Cash Top-up Relief per YA is $16,000 (maximum $8,000 for self and maximum $8,000 for family members, subject to the limit on cash top-up amount for computing tax relief).

As a self-employed person, you can continue to make voluntary CPF contributions (including to your MediSave Account) on or after 1 Jan 2022 under the CPF Board’s Self-Employed Scheme. CPF tax relief will be given on your compulsory MediSave contributions and voluntary CPF contributions subject to conditions.

As a self-employed person, if you wish to make (a) voluntary CPF contributions to your MediSave Account under the CPF Board’s Self-Employed Scheme and/ or (b) cash top-ups to your MediSave Account, you should check and comply with the CPF Board’s respective requirements and procedures for making (a) and/ or (b). This is so that the specific payment to your MediSave Account that is intended to be (a) or (b), is classified as such by the CPF Board.

A personal income tax relief cap of $80,000, which will apply from the Year of Assessment (YA) 2018. This cap applies to the total amount of all tax reliefs claimed, including any relief on voluntary CPF contributions made on or after 1 Jan 2017.

There will be no refund for accepted voluntary CPF contributions. You should therefore evaluate whether you would benefit from tax relief on your voluntary CPF contributions and make an informed decision accordingly.

Basic Healthcare Sum (BHS)

Example

 

Effective Basic Healthcare Sum (BHS)
1 Jan 2022 $66,000 
1 Jan 2021 $63,000
1 Jan 2020 $60,000
1 Jan 2019 $57,200 
1 Jan 2018 $54,500
1 Jan 2017 $52,000

BHS is the estimated savings you need in your MediSave Account for your basic subsidised healthcare needs in old age.

For CPF members below age 65, the BHS will be adjusted annually to keep pace with the expected growth in MediSave use by the elderly. 

Once CPF members reach age 65, their BHS will be fixed for the rest of their lives i.e. if you reached age 65 in 2021, your BHS will be fixed at $63,000.

The above information on BHS is found in CPF Board website. Please contact them if you have any further clarifications.

Example 1: Andrew, 30 year-old employee

Example

Andrew is an employee who is 30 years old
and makes CPF contributions in 2021.

 YA 2022

Total Wages (Ordinary Wage “OW” + Additional Wage “AW”)

 $80,000

Compulsory CPF contribution made by Andrew's employer

17% x $80,000 

=  $13,600

Compulsory CPF contribution by Andrew as an employee

20% x $80,000 

=  $16,000

Total Contribution by Andrew and his employer

$13,600 + $16,000 =  $29,600

Annual CPF contribution cap

$37,740

Voluntary cash contribution directed by Andrew to his MediSave Account in 2021

$9,000

Maximum tax relief that can be allowed on his voluntary cash contribution made to his MediSave Account

$8,140

($37,740 - $29,600)

Total CPF Relief allowable to Andrew

$24,140

($16,000 + $8,140)

 

Example 2: Bernard, 30 year-old who is a self-employed person

Example

Bernard is a self-employed person who is 30 years old and makes CPF contributions in 2021.

YA 2022

Net trade income assessed by IRAS $65,000

MediSave Contribution Rate

8%
Maximum MediSave cap based on his age and net trade income  $5,760

Compulsory MediSave contribution by Bernard as a self-employed individual based on his age and net trade income in 2021

$5,200

Lower of $5,760 or ($65,000 x 8%)
Annual CPF contribution cap $37,740

Voluntary contribution by Bernard as a self-employed person in 2021:

  • Voluntary cash contribution directed by Bernard to his MediSave Account = $22,540
  • Voluntary cash contribution directed by Bernard to his OA, SA & MA = $10,000
 $32,540
($37,740 - $5,200)
CPF relief cap for Bernard as a self-employed individual

$24,050

Lower of $37,740 or (37% x $65,000)

Total CPF relief allowable to Bernard:

$37,740

  • CPF relief cap for Bernard as a self-employed person
$24,050 
 $13,690

Lower of $22,540 or ($37,740 - $24,050)

 

 

Bernard is a self-employed person who is 30 years old and makes CPF contributions in 2022.

YA 2023 New!

Net trade income assessed by IRAS $65,000

MediSave Contribution Rate

8%
Maximum MediSave cap based on his age and net trade income  $5,760

Compulsory MediSave contribution by Bernard as a self-employed individual based on his age and net trade income in 2022

$5,200

Lower of $5,760 or ($65,000 x 8%)
Annual CPF contribution cap $37,740

Voluntary contribution by Bernard as a self-employed person in 2022

 $32,540
($37,740 - $5,200)
CPF relief allowable for Bernard as a self-employed individual

$24,050

Lower of $37,740 or (37% x $65,000)

Example 3: Charlie, 30 year-old who is both an employee and a self-employed person

Example

 

Charlie is an employee and also a self-employed person who is 30 years old. He makes CPF contributions in 2021.

YA 2022

Total Salary (OW + AW)

$40,000

Net trade income assessed by IRAS$20,000
Compulsory CPF contribution made by Charlie's employer

$6,800

(17% x $40,000)
Compulsory CPF contribution by Charlie as an employee

$8,000

(20% x $40,000)
Maximum MediSave cap based on his age and net trade income$5,760
Compulsory MediSave Contribution by Charlie as a self-employed individual based on his age and net trade income in 2021

$1,600

Lower of $5,760 or ($20,000 x 8%)
Annual CPF contribution cap$37,740
Voluntary contribution by Charlie in 2021:

 

  • Voluntary cash contribution directed by Charlie to his MediSave Account = $5,000
  • Voluntary cash contribution directed by Charlie to his OA, SA & MA = $16,340

$21,340
($37,740 - $6,800 - $8,000 - $1,600)

CPF relief cap for Charlie as a self-employed individual

$7,400
Lower of $37,740 or (37% x $20,000)

  Total CPF relief allowable to Charlie:$20,400 
  • Compulsory CPF contribution by Charlie as an employee
$8,000
  • Compulsory MediSave contribution as a self-employed person
$1,600
  • Voluntary contributions as a self-employed person
Capped at $5,800
($7,400 - $1,600)
  $5,000
Lower of $5,000 or ($37,740 - $6,800 - $8,000 - $1,600 - $5,800) 

 


Charlie is an employee and also a self-employed person who is 30 years old. He makes CPF contributions in 2022.

YA 2023 New!

Total Salary (OW + AW)

$40,000

Net trade income assessed by IRAS$20,000
Compulsory CPF contribution made by Charlie's employer

$6,800

(17% x $40,000)
Compulsory CPF contribution by Charlie as an employee

$8,000

(20% x $40,000)
Maximum MediSave cap based on his age and net trade income$5,760
Compulsory MediSave Contribution by Charlie as a self-employed individual based on his age and net trade income in 2022

$1,600

Lower of $5,760 or ($20,000 x 8%)
Annual CPF contribution cap$37,740

Voluntary contribution by Charlie in 2022

$21,340
($37,740 - $6,800 - $8,000 - $1,600)

CPF relief cap for Charlie as a self-employed individual

$7,400
Lower of $37,740 or $7,400 (37% x $20,000) or actual contribution $22,940 ($21,340 +$1600) 

  Total CPF relief allowable to Charlie:$15,400
  • Compulsory CPF contribution by Charlie as an employee
$8,000
  • Compulsory MediSave contribution as a self-employed person
$1,600
  • Voluntary contributions as a self-employed person
Capped at $5,800
($7,400 - $1,600)

 

Voluntary Contributions to MediSave Account (VC-MA) by Companies

Companies (e.g. taxi companies) which have qualifying contracts with self-employed persons (e.g. taxi drivers) may make voluntary cash contribution to the MediSave Accounts (VC-MA) of the self-employed persons and claim tax deductions on such contributions, subject to conditions.

For more information, please read the  FAQs on Voluntary MediSave Contributions by Companies to Self-Employed Persons (DOC, 32.92KB):

  1. FAQ 3 - What is a qualifying contract between the company and the self-employed person?
  2. FAQs 5, 6 and 13 - Tax treatment and filing requirements in respect of the self-employed persons
  3. FAQs 5 and 12 - Tax treatment and filing requirements in respect of the companies

FAQs

Can I obtain a refund of the voluntary CPF contributions I made in year 2017, if for YA 2018, the total amount of personal 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 refunds for accepted voluntary CPF contributions. As such, taxpayers who make voluntary CPF contributions on or after 1 Jan 2017 should note that the overall personal income tax relief cap of $80,000 applies from YA 2018 (when the income earned in 2017 is assessed to tax). Hence, you should evaluate whether you would benefit from tax relief on your voluntary CPF contributions, and make an informed decision accordingly.

Where can I find out more on topping up my MediSave Account works?

You may refer to CPF Board website to find out more how topping up your MediSave Account to

save more for healthcare needs.