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Go
Free And Easy With CPF
E-Submission |
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| Hitachi Transport System (Asia) Pte Ltd, which provides logistics, freight forwarding and warehouse services, converted to an electronic mode of CPF submission in September 2003. The Human Resource Manager, Mr Raymond Tan, said that he was initially concerned about the cost of converting to e-submission, as well as potential virus attacks while submitting the CPF contribution details online. However, his worries were put to rest after discussing these issues with the staff from the E-submission Section. He said, “My worries were unfounded. First of all, CPF Board provides the e-submission service free of charge. Also, I found out that e-submission is safe, as well as convenient. All I need to do is to generate a file from my payroll system and submit it to CPF Board through the secure online system.” |
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Today, Mr Tan is pleased with his decision to go “e”. He said,
“I’ve had no problems with e-submission so far.
The system is very user-friendly; all it takes is a few clicks
and I’m done. Another plus point is the acknowledgement
that I receive after I’ve submitted the CPF contribution
details. This is a useful feature that the hard copy Payment
Advice does not provide.” His parting message to other
employers is, “I urge other employers to try e-submission.
I’ve enjoyed cost and time savings – you should
go “e” and enjoy these benefits too!” |
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| Processing
Fee For Employers Who Use Hard Copy Payment Advice |
Still paying CPF using the hard copy Payment Advice? Go “e” today and save on the processing fee!
From January 2005, employers who submit CPF for 11 to 99 employees using the hard copy Payment Advice will be charged a processing fee of $7 per employee per month. This fee is already in place for employers with 100 or more employees. It may also be extended to employers with one to 10 employees in time to come.
Come June 2004, employers will get to enjoy CPF Board's enhanced e-submission application called Auto-eXcel. Employers need only key in their employees' wage details in the Auto-eXcel and the CPF contribution amounts will be calculated for them. They can then generate a file for electronic submission to the Board. The Auto-eXcel also comes bundled with e-Calendar, an application that can remind you of important events, including when to submit your CPF contribution details. These applications will be available to all employers free of charge!
To learn more about the processing fee and e-submission, go
to www.cpf.gov.sg or call the CPF Employer Call Centre at 1800-226
3877 (Code 1). | |
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| Paying
CPF On Additional Wages Paid Before The End Of The Year |
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In the previous issue of InCompany with CPF, the new formula for the Additional Wage Ceiling was given as:
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Additional Wage Ceiling =
$93,500 – Total Ordinary Wages subject to CPF for the year
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If you are paying Additional Wages before the end of the year, you will not know the Total Ordinary Wages subject to CPF for the year yet. Below are some guidelines on how to pay CPF contributions on Additional Wages paid before the end of the year.
For existing employees who joined before 2004: Estimate the Additional Wage Ceiling for 2004 based on the wage records for 2003. Apply the salary ceiling of $5,500 on the Ordinary Wages paid each month in 2003 to estimate the Total Ordinary Wages subject to CPF. You should do this even if the employee did not work for the full calendar year (e.g. the employee joined in the middle of 2003).
Please see the example below:
Kelvin received a bonus of $10,000 in May 2004. He started working for Company XYZ in September 2003. The Additional Wage (AW) Ceiling for 2004 can be estimated by applying the salary ceiling of $5,500 to the Ordinary Wages (OW) paid in 2003.
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Month |
OW paid to Kelvin in 2003 ($) |
OW (subject to CPF) used to estimate AW Ceiling in 2004 ($) |
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Sep |
3,000 |
3,000 |
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Oct |
4,000 |
4,000 |
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Nov |
4,000 |
4,000 |
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Dec |
6,000 |
5,500 |
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Total |
17,000 |
16,500 |
| Estimated AW Ceiling for 2004 |
= |
$93,500 - $16,500 |
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$77,000 |
Since the $10,000 bonus Kelvin received is within the estimated AW Ceiling of $77,000, Company XYZ will pay CPF on the full bonus of $10,000.
For employees who join in 2004: Pay CPF on the actual Additional Wages or up to $93,500, whichever is lower.
Adjustments at the end of the year
If you have earlier used an estimated Additional Wage Ceiling to pay the CPF contributions, you should determine the actual ceiling at the end of the year based on the Ordinary Wages subject to CPF in 2004. Any shortfall should be paid together with the CPF contributions for December 2004. You can apply for a refund of the excess contributions using the form CNR/Form CAPR. |
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| Pay
CPF On Cash Payments |
What payments attract CPF contributions?
All cash payments due or given to an employee for work done are wages and attract CPF contributions. These cash payments can be stated in the employee’s contract or given voluntarily by employers to employees. They include salary, overtime pay, incentives, commissions, bonuses, allowances, etc.
What about other cash payments that supplement an employee’s wages such as cash gifts (e.g. hongbao), training grants, allowances for meals and lodging, etc? These payments attract CPF contributions too as they are cash benefits granted to employees in relation to work done.
What payments do not attract
CPF contributions?
Employers do not have to contribute CPF for rewards or benefits given in kind. Examples of such rewards and benefits are dining vouchers, gifts such as watches, cameras, etc
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Cash payments, which are not related to work done by the employees,
also do not attract CPF contributions. These include scholarships
and bursaries, gifts in kind that form part of the staff welfare,
etc. Likewise, reimbursements of expenses such as transport, meals,
etc do not attract CPF contributions. This is because unlike cash
allowances which are given to employees as part of their wages,
reimbursements are to compensate employees for expenses incurred
on behalf of their employers in the course of work.
For a list of different types of payment to employees, please
refer to the Employers’ Handbook online at www.cpf.gov.sg. |
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Starting
a business? Use SingPass to register as an CPF employer online!
You can now go online to register as an employer with CPF Board.
To do so, simply log on to www.business.gov.sg
with your SingPass and get your application processed within a
day. What’s more, you can also enjoy a one-stop online application
for the different business licences and permits such as public
entertainment, food & beverage, media, etc.
Need help? Email: btfeedback@mti.gov.sg
New
limit on CPF contributions for 2004
The new limit on CPF contributions is $23,760 per year. This means
that no voluntary contributions are allowed if mandatory contributions
are $23,760 or more. If mandatory contributions are less than
$23,760, you may top up the difference with voluntary contributions
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