| Deputy Prime Minister and Minister for Finance Lee Hsien Loong announced at this year’s Budget Speech that all cash top-ups made from this year under the CPF Minimum Sum Topping-Up Scheme will now enjoy a tax relief of up to $7,000 per year, instead of $6,000 previously.
The objective of Minimum Sum Top-Up is to encourage more Singaporeans to contribute to the financial security of their loved ones.
The CPF Minimum Sum Topping-Up scheme was first introduced in 1987. These top-ups can be in cash or from members’ CPF Ordinary Accounts. The tax relief for cash contribution was previously only applicable to those who top up their own Retirement Accounts and those of their parents’ and/or their grandparents who are 55 years and above. This benefit has now been extended to topping up for non-working spouses as well. To qualify for the tax relief, the non-working spouse of the CPF member must be 55 years and above, and earn $2,000 or less in the preceding year.
The maximum amount that a member can top up is the difference between the Minimum Sum the topping up recipient is required to set aside and his CPF regrossed balance (excluding Medisave) when he reaches age 55. This means that for a topping up recipient who reached age 55 in December 2003, and has a CPF regrossed balance of $30,000, the maximum top up he can receive is $50,000 (Minimum Sum of $80,000 less $30,000).
Those who wish to enjoy the increased tax relief and the higher CPF interest rate for the Retirement Account (currently 4% per annum) can download application forms online or obtain application forms for Minimum Sum Top-Up from all CPF offices.
More details of the Topping-Up Scheme are available in the online Minimum Sum Scheme handbook. |