Key takeaways
- The Ordinary Wage (OW) ceiling is $8,000 a month from January 2026. CPF is not payable on OW above that.
- The Additional Wage (AW) ceiling is $102,000 minus the employee’s total OW subject to CPF for the year. It applies per employee, per employer, per calendar year.
- The CPF Annual Limit, currently $37,740, caps all mandatory and voluntary contributions to an employee in a year.
- Estimate the AW ceiling when you pay a bonus, then recalculate in December or the employee’s last month and pay any shortfall.
- Always declare actual wages to the CPF Board, even when they are above the ceilings.
For most kitchen and floor staff, the CPF ceilings never come into play. They matter for your higher earners, such as a head chef, an operations manager or an area manager, and in any month when you pay a large bonus. Getting them wrong means either underpaying CPF, which attracts interest, or overpaying, which you then have to reclaim. This guide explains each cap with examples. For the rates themselves, see our guide to employer CPF contributions, and for the payslip side, our walk-through on deducting employee CPF.
The three caps at a glance
| Cap | What it limits | Current figure |
|---|---|---|
| Ordinary Wage ceiling | OW that attracts CPF in a calendar month | $8,000 a month |
| Additional Wage ceiling | AW that attracts CPF in a calendar year, per employer | $102,000 minus total OW subject to CPF for the year |
| CPF Annual Limit | All mandatory and voluntary CPF to the employee in a year | $37,740 |
Sources: CPF Board answers on the OW ceiling, the AW ceiling and the CPF Annual Limit, all checked on 28 September 2026.
The Ordinary Wage ceiling: $8,000 a month
The CPF Board’s page on what payments attract CPF defines Ordinary Wages as wages given for the employee’s work in that month and payable by the 14th of the following month. Monthly salary is the typical example. The OW ceiling is the most OW in a calendar month that attracts CPF. The Board’s own example: if an employee’s OW is $9,000 and the ceiling is $8,000, CPF is computed on $8,000.
The ceiling has risen in stages. According to the Board’s OW ceiling page:
| Period | OW ceiling |
|---|---|
| January 2016 to August 2023 | $6,000 |
| September to December 2023 | $6,300 |
| 2024 | $6,800 |
| 2025 | $7,400 |
| From January 2026 | $8,000 |
The rate tables from 1 January 2027 still show an OW ceiling of $8,000. If you have managers earning between $7,400 and $8,000, their CPF went up in January 2026 even without a pay rise, because more of their salary became subject to CPF.
Maximum monthly CPF contribution by age
Because OW is capped, there is a maximum monthly contribution on OW for each age group. The 2026 rate table prints the maximum total and employee amounts; the employer’s maximum is the difference.
| Employee’s age (2026) | Max total on OW | Max employee share | Max employer share |
|---|---|---|---|
| 55 and below | $2,960 | $1,600 | $1,360 |
| Above 55 to 60 | $2,720 | $1,440 | $1,280 |
| Above 60 to 65 | $2,000 | $1,000 | $1,000 |
| Above 65 to 70 | $1,320 | $600 | $720 |
| Above 70 | $1,000 | $400 | $600 |
This answers the common questions “max employee CPF contribution” and “max employer CPF contribution” for a single month of salary. From January 2027 the maximums rise for two bands: above 55 to 60 goes to $2,840 total ($1,520 employee), and above 60 to 65 to $2,080 total ($1,040 employee), according to the 2027 tables. Additional Wages such as bonuses sit on top of these monthly figures, subject to their own ceiling.
The Additional Wage ceiling for bonuses
Additional Wages are wages that are not OW. The CPF Board’s example is an annual performance bonus; in F&B and retail this also covers many incentive and year-end payments. The Board’s OW and AW explainer notes that the payable date is the date you are contractually obliged to pay, not the date payroll happens to run.
The AW ceiling is $102,000 minus the total OW subject to CPF for the year. It applies per employee, per employer, per calendar year. The effect is simple: the more OW that attracted CPF during the year, the less room there is for CPF on bonuses.
- An employee on $5,000 a month has $60,000 of OW subject to CPF over a full year, so their AW ceiling is $42,000.
- An employee on $8,000 or more has $96,000 of OW subject to CPF, so their AW ceiling is $6,000.
The CPF Board offers an AW ceiling calculator on its contributions page if you want to check a case.
Worked bonus examples for chefs and managers
These examples assume Singapore Citizens aged 55 and below, employed all year, using the 2026 rates of 37% total and 20% employee.
| Employee | Monthly OW | December bonus | AW ceiling | Bonus subject to CPF | CPF on bonus (total / employee / employer) |
|---|---|---|---|---|---|
| Head chef | $6,000 | $12,000 | $30,000 | $12,000 | $4,440 / $2,400 / $2,040 |
| Operations manager | $9,500 | $15,000 | $6,000 | $6,000 | $2,220 / $1,200 / $1,020 |
For the head chef, OW subject to CPF is $72,000, so the ceiling of $30,000 comfortably covers the bonus. For the operations manager, only $8,000 of each month’s $9,500 attracts CPF, so OW subject to CPF is $96,000 and only $6,000 of the bonus attracts CPF.
Note how the manager’s figures meet the Annual Limit: 12 months at $2,960 is $35,520, plus $2,220 on the bonus, which is $37,740. That is not a coincidence. The CPF Board sets the $102,000 figure and the Annual Limit so that they line up for this age group.
Bonuses paid early, and staff who leave
You often pay a bonus before you know the year’s total OW. The CPF Board’s answer on AW paid before the end of the year says to estimate the AW ceiling using the current year’s OW, then recalculate with the actual OW once it is known, usually in December or in the employee’s last month. Any shortfall is paid with December’s contributions or the last month’s contributions; any overpayment can be refunded.
Here is how that plays out for a manager on $9,000 a month who receives a $12,000 bonus in March and resigns at the end of June:
- In March: you estimate a full year of OW subject to CPF at $96,000, so the estimated AW ceiling is $6,000. You pay CPF on $6,000 of the bonus.
- In June, the last month: actual OW subject to CPF is six months at $8,000, or $48,000. The recalculated AW ceiling is $54,000, which covers the full $12,000 bonus.
- The shortfall: the other $6,000 of the bonus now attracts CPF. At 37%, that is $2,220 more, paid with June’s contributions.
This is why payroll systems and accountants re-run the AW ceiling when someone leaves. Our comparison of payroll software for F&B covers tools that handle this for you.
Overpayments, multiple employers and declaring wages
- Excess over the AW ceiling: the CPF Board’s page on refunds says you should apply for a refund promptly once you discover it, and requests generally have to be made within one year of payment. You must refund the employee’s share to the employee before applying.
- Excess over the Annual Limit: from February 2024, contributions above the CPF Annual Limit are refunded automatically to the employer’s Direct Debit account, according to the same page. This mostly arises when an employee has more than one employer or makes voluntary contributions.
- Declaring wages: the Board’s guidance on declaring accurate wages says to declare the employee’s actual OW and AW, not amounts reduced to the ceilings. The ceilings limit the CPF, not the wages you report.
Because the AW ceiling applies per employer, a staff member who works for two unrelated companies in a year has a separate AW ceiling with each. Ask the CPF Board if you are unsure how this applies within a group of related companies.
What the caps mean for your labour budget
For budgeting, the caps give you a useful ceiling on CPF cost per senior hire. A manager aged 55 or below on $8,000 or more costs at most $1,360 a month in employer CPF on salary in 2026, plus 17% of any bonus that falls within the AW ceiling. Below the ceiling, employer CPF scales with pay.
When you plan headcount, include CPF, the Skills Development Levy and bonuses in the cost of each role. Our restaurant labour cost guide shows how to track labour as a share of sales, and our guide to hiring F&B staff covers structuring offers. If incentives are tied to outlet sales, ChaChaCha’s reports show sales by outlet and period, which gives payroll a consistent figure to work from. Ask us to confirm which report exports suit your payroll provider, or talk to us.
