Most countries have some kind of deduction to the income. It could be income tax – tax deducted at source,or it could be Provident Fund, or some other voluntary contribution.
Singapore CPF Rules
In Singapore, all salaried employees need to contribute 20% of their salary into their Central Provident Fund ( also called as CPF). The employer contributes another 14.5% currently.
So payroll executives from Finance or HR professionals need to calculate the correct amount for the contribution to CPF, and provide the net salary to the employees. Employer also needs to know their total payroll expenses so as to know their Payroll Liability each month.
Calculating CPF Rates for Employee & Employer in Singapore
I have created a simple spreadsheet to aid in this matter. If you wish to use this singapore-salary-template, you can fill in your own employees details, their basic pay, and the following is automatically calculated:
- Employee’s contribution,
- The employer contribution,
- Total payable to CPF,
- Net salary to employee
- Gross Salary expense of employer
The spreadsheet uses simple formulas that are already pre-programmed. So you can just begin to use this spreadsheet for your company. And if the CPF Contribution rate for the employee or employer changes in Singapore, all you need to do is to change it in the top row, at a single place, and everything will work smoothly.
If you need any enhancements in calculating CPF contribution and Payroll expenses for companies in Singapore, or have any comments, do let me know. You can leave a comment below this post.
And of course, if you wish to learn how to create such excel spreadsheets, and use simple Microsoft Excel formulas and functions, you can also attend our Microsoft Excel Training classes in Singapore.