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Minimum wage in Singapore
Singapore’s payroll
Statutory benefits in Singapore
Other employee benefits in Singapore
Compliant, seamless payroll and benefits in Singapore and beyond
Payroll in Singapore
Managing payroll and employee benefits in Singapore requires a deep understanding of local regulations to ensure full compliance and enhance workforce satisfaction. Singapore has specific payroll regulations, including requirements for timely salary payments, CPF (Central Provident Fund) contributions, tax deductions, and compliance with statutory leave entitlements. Employers must also provide mandatory insurance, such as work injury compensation and medical coverage, to protect employees.
Given the complexities of payroll management, many companies, especially those unfamiliar with local labour laws, opt for payroll outsourcing. Outsourcing allows businesses to delegate payroll tasks to experienced providers, reducing administrative burdens, and ensuring compliance with Singapore’s strict payroll regulations. By partnering with a reliable global payroll provider, such as CXC, companies can streamline payroll operations, minimise compliance risks, and save valuable time. Whether you need comprehensive payroll outsourcing or a dedicated payroll management solution, expert support ensures smooth handling of complex HR tasks. This allows businesses to focus on growth while maintaining a compliant and supportive workplace.
In this guide, we cover everything you need to know about managing payroll in Singapore, including statutory and supplementary.
Minimum wage in Singapore
Singapore does not operate under a universal minimum wage system. Instead, the country applies sector-specific wage policies targeting industries such as cleaning, security, and landscaping. These regulated sectors are subject to mandatory Progressive Wage requirements designed to ensure fair and sustainable pay levels for workers in essential services. For employees outside these regulated sectors, there is no statutory minimum wage per hour or per month, and employers retain flexibility to set wages based on job scope, required skills, and prevailing market conditions.
Local Qualifying Salary (LQS) Requirements
The Local Qualifying Salary (LQS) remains a central element in determining how many local workers an employer may count toward the quota for hiring Work Permit and S Pass holders. The current LQS is SGD 1,600 for full-time employees working between 35 and 44 hours per week. Part-time employees must earn at least SGD 10.50 per hour to meet LQS criteria.
This system ensures that local employees are genuinely and meaningfully employed rather than included on payroll merely to meet quota obligations. For quota calculation purposes, a Singaporean or Permanent Resident earning at least SGD 1,600 per month counts as one local worker, while those earning between SGD 800 and below SGD 1,600 count as half. Employers must also ensure that if a role falls under the Progressive Wage framework, the higher of the applicable Progressive Wage or the LQS is met. Firms employing workers who exceed the standard 44-hour workweek must comply with increased LQS thresholds proportionate to the additional hours worked.
The Progressive Wage Portal remains an official reference for employers to verify wage and job information and to ensure compliance with both LQS and Progressive Wage requirements.
Minimum Salary Requirements for Foreign Workers
Revised salary thresholds for Employment Pass (EP) holders took effect on 1 January 2025 and continue to apply in 2026, including for EP renewals beginning January 2026. Under this updated framework, the minimum salary for new EP applicants in general sectors is SGD 5,600 per month, while applicants in the financial services sector must meet a higher minimum of SGD 6,200.
Salary requirements also scale with experience. Mid-career professionals in their mid-40s must meet higher thresholds of SGD 10,700 for general roles and SGD 11,800 in financial services. These adjustments reflect Singapore’s emphasis on maintaining a high-quality foreign workforce aligned with national economic needs.
Workfare Income Supplement (WIS) Scheme
The Workfare Income Supplement (WIS) continues to provide financial and social support to lower-wage Singaporean workers in 2026. The scheme enhances income stability through direct cash payments while simultaneously strengthening long-term retirement adequacy by allocating additional contributions into the worker’s CPF account. WIS also incorporates a training component that encourages eligible workers to upskill, improve their employment prospects, and access opportunities for higher-earning roles. As a core pillar of Singapore’s social support framework, WIS helps to reduce income inequality, promote sustained employment among lower-income Singaporeans, and foster long-term financial resilience.
Singapore’s payroll
Managing payroll in Singapore comes with a unique set of challenges and responsibilities for employers. Understanding the intricacies of payroll is essential, especially for companies expanding into the country.
Alternatively, employers can offload payroll management and other regulation-related work to global payroll providers like CXC. This ensures compliance, not just to local labour laws, but to best practices as well.
Payroll cycle in Singapore
The typical payroll cycle in Singapore is monthly. Employers are required to pay employees within seven days of the end of the salary period. This means that if your salary period ends on the last day of the month, employees should receive their salary by the 7th of the following month. If an employee resigns or is terminated, payment is due on the last day of work, and no later than that day. Employers must adhere to these timelines to avoid any legal complications.
Payroll taxes and deductions in Singapore
Understanding payroll taxes in Singapore is crucial for compliance with local regulations. Employers are responsible for calculating and withholding the relevant taxes from their employees’ wages. The primary taxes related to payroll are:
- Employee Central Provident Fund (CPF) contributions: Employers and employees are both required to contribute to the CPF. The contribution rate varies depending on the employee’s age and wages. For instance, employees below 55 years old typically contribute 20%, while employers contribute 17%.
- Income tax: Singapore employer payroll taxes also include income tax obligations. While employees are responsible for their own income tax filings, employers are required to ensure accurate payroll calculation, including the deduction of tax contributions.
Failure to meet these payroll tax obligations can lead to penalties and legal issues, so it is crucial to stay up to date with the current tax rates and deadlines.
Payroll benefits in Singapore
In addition to salary, employers in Singapore often provide various payroll benefits to their employees. These benefits can include, but are not limited to:
- Medical benefits: Companies typically offer medical insurance to their employees, with some employers also providing dental and optical coverage.
- Bonus schemes: Employers may offer performance-based bonuses as part of their compensation package.
- Leave entitlements: Employees are entitled to statutory leave benefits, such as annual leave, sick leave, and public holidays.
These benefits are often factored into the payroll deductions in Singapore and should be calculated correctly to avoid discrepancies. The inclusion of these benefits also adds complexity to payroll calculations, making it important for employers to keep detailed records.
13th-month salary in Singapore
One of the distinctive features of payroll in Singapore is the 13th-month salary, which is often paid out at the end of the year. While it is not a statutory requirement, it is customary for employers to pay a 13th salary to their employees. This bonus is typically given as a lump sum in December, although some employers may distribute it earlier in the year.
The 13th-month salary is typically equivalent to one month’s salary, though some employers may offer a higher or lower amount depending on company policies or employee performance.
Statutory benefits in Singapore
Employers in Singapore are required to provide certain statutory benefits to their employees as mandated by law. These benefits ensure social security, community support, and equal opportunity for all workers in Singapore.
Social security contributions in Singapore
Central Provident Fund (CPF) is the only government-mandated pension system in the country. This defined contribution system comprises funds contributed by the employee, the employer, and the interest accumulated on these contributions. The CPF ensures retirement adequacy and contributions are allocated across various accounts, including the Ordinary, Special, and Medisave accounts.
The CPF contribution rates vary based on the employee’s age, with higher rates for younger employees and reduced rates for older workers. Employers must deduct and contribute the correct amounts to remain compliant with the CPF Act.
Moreover, employees belonging to certain ethnic and community groups may be required to contribute to specific community funds:
- Mosque Building and Mendaki Fund (MBMF): All working Muslim Singapore citizens, permanent residents, and foreign workers contribute to the MBMF, which supports mosque building, community education, and religious initiatives. Employees may choose to opt out, but contributions are otherwise mandatory.
- Chinese Development Assistance Fund (CDAC): Singapore citizens and permanent residents from the Chinese community contribute to this fund based on their wage scale unless they opt out.
- Singapore Indian Development Association (SINDA): Employees from the Indian community, including those from the Indian subcontinent, may contribute to SINDA. Foreign workers and those on levy schemes are exempt, and opting out is allowed.
- Eurasian Community Fund (ECF): Employees who identify as Eurasian (of mixed European and Asian ancestry) contribute to this fund unless they decide to opt out.
Self-employed contributions in Singapore
Self-employed individuals in Singapore are also subject to statutory contributions. While they are not required to contribute to the CPF’s Ordinary Account, they must make contributions to the Medisave Account, which funds healthcare needs. The required Medisave contribution amount is based on the individual’s declared net trade income and age.
Self-employed persons who are also members of specific ethnic groups may opt to contribute to community funds like SINDA, CDAC, MBMF, or ECF to support their respective communities.
Other employee benefits in Singapore
Providing comprehensive employee benefits in Singapore goes beyond meeting statutory requirements. As an employer, offering supplementary benefits not only boosts employee satisfaction but also helps attract and retain top talent.
Employee medical benefits in Singapore
Under Singapore law, employers must provide certain medical benefits for employees. These include entitlements under the Employment Act:
- Sick leave: Employees are entitled to paid outpatient and hospitalisation sick leave, based on their length of service.
- Maternity and paternity leave: Female employees can take up to 16 weeks of paid maternity leave, while eligible fathers can take two weeks of paid paternity leave.
- Childcare leave: Parents with children under seven years old are entitled to six days of childcare leave annually.
In addition to statutory requirements, many employers enhance their employee benefits programs in Singapore by offering supplementary healthcare benefits. These often include medical insurance, dental care, and wellness programs. Such initiatives demonstrate a commitment to employee well-being and help reduce absenteeism and turnover.
Insurance benefits in Singapore
Employers in Singapore must also ensure their employees are covered by certain insurance policies, as required by law, including Work Injury Compensation Insurance. This mandatory insurance covers medical expenses, lost wages, and compensation for work-related injuries or illnesses. It applies to manual workers and non-manual workers earning up to $2,600 per month.
Many companies go beyond legal requirements by offering private health and life insurance policies as part of their employee benefits insurance package. These policies can cover hospitalisation, critical illnesses, and disability, providing financial security for employees and their families.
Offering comprehensive insurance benefits enhances your organisation’s reputation as an employer that values its workforce’s health and safety.
Other common supplementary benefits in Singapore
Aside from medical and insurance benefits, employers often provide additional perks to foster a supportive and engaging work environment. Some of the considered best employee benefits in Singapore include:
- Flexible work arrangements: Allowing employees to work from home or offering flexible hours is increasingly common and valued.
- Professional development opportunities: Subsidised training programs, workshops, and tuition reimbursement help employees grow professionally and feel invested in their careers.
- Wellness initiatives: Corporate gym memberships, mental health resources, and wellness days can enhance overall employee satisfaction and productivity.
- Enhanced leave policies: Offering additional leave, such as volunteer leave or sabbaticals, demonstrates a commitment to work-life balance.
Providing these benefits not only improves employee morale but also strengthens your employer brand, making your organisation a top choice for talent.
Compliant, seamless payroll and benefits in Singapore and beyond
Getting payroll and benefits right is not just a legal issue. Every country also has its own customs, norms, and expectations about employee compensation. And if your operations are not in line with your workers’ expectations, they may not stick around for long.
Thankfully, we know what we are doing. When you work with CXC to engage workers in Singapore, we will handle everything from tax withholding to employee bonuses on your behalf.
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