Last checked: October 2026. Rules from the CPF Board.
How is CPF calculated on a bonus?
A bonus is an Additional Wage. CPF is payable on it only up to the Additional Wage ceiling, which is S$102,000 minus the employee's total Ordinary Wages subject to CPF for the year. Ordinary Wages count towards that total only up to S$8,000 a month from 1 January 2026.
Ordinary Wages and Additional Wages
Ordinary Wages are the wages due for work in a month, such as basic salary and regular allowances. Additional Wages are payments not tied to work in a particular month, such as annual bonuses and leave encashment. CPF treats them differently: Ordinary Wages have a monthly ceiling, and Additional Wages have a yearly one.
The Additional Wage ceiling
Additional Wage ceiling = S$102,000 − total Ordinary Wages subject to CPF for the year
For an employee earning S$8,000 or more every month, the Ordinary Wages subject to CPF for a full year are S$96,000, so the Additional Wage ceiling is S$6,000. Any part of a bonus above that attracts no CPF. For lower earners, the ceiling is much higher, and the whole bonus is usually subject to CPF.
The raise in the Ordinary Wage ceiling to S$8,000 on 1 January 2026, while the annual ceiling stayed at S$102,000, means less of a year-end bonus attracts CPF for high earners than before.
Worked example
An employee aged 40 earns S$9,000 a month throughout 2026 and receives a S$20,000 bonus in December.
| Ordinary Wages subject to CPFS$8,000 ceiling × 12 months | S$96,000 |
| Additional Wage ceilingS$102,000 − S$96,000 | S$6,000 |
| Bonus subject to CPF | S$6,000 |
| Employee CPF on the bonus20% of S$6,000 | S$1,200 |
| Employer CPF on the bonus17% of S$6,000 | S$1,020 |
The other S$14,000 of the bonus attracts no CPF. An employee earning S$5,000 a month would have a ceiling of S$42,000, so a S$20,000 bonus would be fully subject to CPF.
Sample only. Names and figures are illustrative.
Why estimates change at year end
When a bonus is paid before December, the Ordinary Wages for the rest of the year are still an estimate. If pay changes later, the ceiling changes too, and CPF on the bonus may need correcting. Tracking this for every employee is part of our CPF submission service. To work out CPF on a normal month's salary, use the CPF contribution calculator.
Official source: CPF Board, how much CPF contributions to pay. This calculator gives an estimate before rounding and is not a substitute for the CPF Board's own calculations.