How much does it really cost to hire in Singapore in 2026?
Singapore CPF adds 17% employer contribution on top of salary. But only the first SGD 8,000 of monthly ordinary wages attracts the charge. High earners cost proportionally less in CPF. A SGD 72,000 hire lands at around 117 percent of gross before the Teamed fee.
· Singapore guide
Illustration · Singapore
Singapore CPF is 17% for the employer on employees aged 55 and below. It only applies to monthly ordinary wages up to SGD 8,000. Above that ceiling, no further CPF applies to the excess.
Every employee gets 7 days of paid annual leave in their first year of service, plus 11 public holidays. Sick leave is 14 days outpatient and 60 days hospitalisation per year after six months.
A SGD 72,000 hire costs roughly SGD 84,240 in total employer cost before the Teamed fee (illustrative, based on verified statutory rates). The CPF ceiling means the loading shrinks as salary rises above SGD 96,000 a year.
The headline: what a Singapore hire actually costs
Start with the gross salary. Add 17% CPF on ordinary wages up to SGD 8,000 per month. That is the biggest single line. Then layer in annual leave and public holidays, which sit inside the salary cost.
The table below shows illustrative totals at a SGD 72,000 salary. These are computed from verified statutory rates and labelled illustrative. They are not statutory figures.
CPF is different from most employer social security schemes because the charge stops at the Ordinary Wage (OW) ceiling. From 1 January 2026 the ceiling is SGD 8,000 per month. A SGD 6,000 monthly salary pays CPF on the full amount. A SGD 10,000 monthly salary pays CPF only on SGD 8,000. The ceiling is why Singapore's total employer cost loading narrows at higher salary points.
| Line | Illustrative cost on SGD 72,000 salary | Source |
|---|---|---|
| Gross salary (SGD 6,000/month) | SGD 72,000 | Contract |
| Employer CPF at 17% on SGD 72,000 (below OW ceiling) | SGD 12,240 (illustrative) | CPF Board contribution rates 2026 |
| Skills Development Levy (SDL) on capped ordinary wages | SGD 360 to SGD 720 (illustrative estimate) | CPF Board SDL guide |
| Annual leave: 7 days in year one, built into salary | Included in salary | Employment Act s.88A |
| Public holidays: 11, built into salary | Included in salary | Public Holidays Act |
| Outpatient sick leave: 14 days per year (after 6 months) | Low average cost; varies by absence rate | Employment Act s.89 |
| Total illustrative employer cost (before Teamed fee) | SGD 84,240 to SGD 84,960 (illustrative) | ~117% of gross |
These figures are illustrative. They are computed from the 17% CPF employer rate confirmed for 2026 and the SGD 8,000 OW ceiling from the CPF Board source. They are not statutory figures and will vary with actual ordinary wages, age bracket, and SDL calculations.
Add the Teamed fee from $599 per employee per month and the total rises to around 127 to 128 percent of gross at a SGD 72,000 salary point. Use the Employer Cost Calculator to run your own salary figures.
The employer CPF contribution rate for employees aged 55 and below is 17%. The employee contributes 20%. Combined, that is 37 percent of ordinary wages. The Ordinary Wage ceiling is SGD 8,000 per month from 1 January 2026. Wages above the ceiling do not attract further CPF on the excess in the same month.
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Confirm gross salary and pay structure
Set the gross monthly ordinary wage. Identify whether there will be an Annual Wage Supplement or bonus that will attract additional CPF.
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Calculate employer CPF
Apply 17% to monthly ordinary wages up to SGD 8,000. The charge stops at the ceiling. Check the age bracket for employees over 55, as lower rates apply.
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Add Skills Development Levy
Calculate SDL at 0.25 percent on monthly wages up to SGD 4,500. The minimum is SGD 2 per employee per month. It is small but it is real.
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Allow for leave and public holidays
Budget 7 days paid annual leave in year one rising with tenure, plus 11 public holidays. Sick leave is event-driven and typically low cost.
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Check pass category if the hire is a foreign national
Confirm whether the employee needs an Employment Pass, S Pass, or work permit. Each carry different conditions and Foreign Worker Levy obligations if applicable.
CPF contributions: Singapore's biggest cost line
Employer CPF is 17% on ordinary wages up to SGD 8,000 per month. There is no employer CPF charge on ordinary wages above that ceiling in the same month.
The rates change as employees age. The 17% rate applies to employees aged 55 and below. Lower rates apply for older employees. Check the CPF Board table when hiring anyone over 55.
CPF is Singapore's national social security and retirement savings scheme. The employer and employee both contribute. The employer bears the 17% and the employee bears 20%. Both rates apply only to Ordinary Wages up to the SGD 8,000 monthly ceiling. Annual bonus and other Additional Wages have their own CPF cap calculated separately.
The Ordinary Wage ceiling and what it means for your budget
The SGD 8,000 monthly OW ceiling was raised from SGD 7,400 on 1 January 2026. It means the maximum CPF employer cost on ordinary wages per employee per month is SGD 1,360 at the 17% rate. Above SGD 8,000 a month the CPF charge on ordinary wages stops. A SGD 120,000 a year employee and a SGD 96,000 a year employee carry the same maximum CPF cost on ordinary wages. The loading falls as salaries rise above SGD 96,000.
Age-based CPF rates
The 17% employer rate applies to employees aged 55 and below. Rates taper for employees aged 56 to 60, 61 to 65, and above 65. If your Singapore team includes older workers, budget at the lower rates that apply to their age bracket. The full age-band table is on the CPF Board website.
Skills Development Levy
Employers also pay the Skills Development Levy (SDL) on the first SGD 4,500 of monthly gross wages per employee. The levy funds workforce training through SkillsFuture Singapore. The rate is 0.25 percent on wages up to SGD 4,500 a month, with a minimum of SGD 2 per employee per month. SDL adds a modest but real cost, especially for lower-paid roles where it applies to the full monthly wage. The SDL is administered via CPF Board.
Leave costs: what the law requires
Every Employment Act-covered employee gets 7 days of paid annual leave in their first year. The entitlement rises by one day for each additional year, up to 14 days in year eight and beyond.
Sick leave costs are real but event-driven. Outpatient sick leave is 14 days per year after six months of service. Hospitalisation leave is 60 days per year, which includes the 14 days outpatient days.
Annual leave
The 7 days entitlement in year one is the statutory minimum for employees covered by the Employment Act. It rises to eight days in year two and continues scaling up to a maximum of 14 days from year eight. Most professional roles in Singapore offer more than the statutory floor. Market practice for knowledge workers is 14 to 21 days. Budget the actual number you intend to offer, not just the statutory floor.
Public holidays
Singapore has 11 gazetted public holidays in 2026. Employees covered by the Employment Act are entitled to paid leave on all 11 days. If work is required on a public holiday, the employee is entitled to an extra day's pay. Build 11 paid days into your annual cost model.
Sick leave
After six months of service, employees are entitled to 14 days of paid outpatient sick leave per year. Hospitalisation leave is 60 days per year, with the 14 days outpatient days counting within that total. Paid sick leave requires certification from a company doctor or approved medical practitioner. Before six months the entitlement accrues on a prorated basis. The sick leave cost is low on average but concentrates when extended hospitalisation occurs.
Parental leave
Mothers get 16 weeks of Government-Paid Maternity Leave (GPML) for a Singapore citizen child. Fathers get 4 weeks of Government-Paid Paternity Leave (GPPL) from 1 April 2025. Both are funded by the government, not by the employer, for the government-paid portions. The employer pays up front and claims reimbursement from the government. Cash flow rather than net cost is the main impact. Verify your employee's citizenship status to confirm the reimbursable portion.
Illustrative cost at three salary points
The CPF ceiling flattens the employer loading at higher salaries. At SGD 72,000 the loading before the Teamed fee is around 117 percent. At SGD 144,000 the CPF ceiling keeps the employer CPF fixed and the loading falls below 110 percent.
The Teamed fee from $599 per employee per month is flat regardless of salary. It weighs more heavily at lower salary points.
All totals below are illustrative. They are computed from the 17% employer CPF rate and the SGD 8,000 Ordinary Wage ceiling. SDL is estimated at 0.25 percent on capped wages. These are not cached statutory figures. Actual totals will vary with age bracket, Annual Wage Supplement structure, and individual circumstances. The Teamed fee is shown at an illustrative SGD 9,588 per year (from $599 x 12 at an illustrative rate).
| Gross salary | Employer CPF (17%, capped) | SDL (illustrative) | Teamed fee (illustrative) | Total cost (illustrative) | Loading |
|---|---|---|---|---|---|
| SGD 48,000 | SGD 8,160 | SGD 135 | SGD 9,588 | SGD 65,883 | 137% |
| SGD 72,000 | SGD 12,240 | SGD 135 | SGD 9,588 | SGD 93,963 | 130% |
| SGD 120,000 | SGD 16,320 (capped) | SGD 135 | SGD 9,588 | SGD 146,043 | 122% |
At SGD 120,000 the CPF employer cost is the same as at SGD 96,000 because both hit the monthly OW ceiling. The CPF cost does not grow beyond SGD 16,320 a year on ordinary wages regardless of how high the salary goes above SGD 96,000. This makes Singapore a relatively efficient CPF environment for high earners compared with uncapped social security systems.
These figures exclude discretionary bonuses (which attract CPF on the Annual Wage Supplement up to a separate annual cap), employer-paid benefits, and any enhanced leave costs above the statutory floor.
How Teamed handles Singapore employment costs for you
Teamed becomes your legal employer of record in Singapore for from $599 per employee per month, with zero FX mark-up in any currency.
CPF contributions, SDL, Employment Pass administration, and the full Singapore compliance stack run on one platform.
Real HR and legal experts handle your Singapore hires from the first offer letter through every CPF submission and IR8A filing. An actual person, not a chatbot or a pooled queue. There is no setup fee and no exit fee. Every employer cost passes through at cost, itemised on every invoice. You see the CPF line, the SDL line, and the leave accrual line. Nothing is hidden inside the management fee.
EOR payroll, contractor onboarding, and entity setup all live on one platform. A Singapore contractor who converts to payroll keeps their record. That same employee can graduate from EOR to your own Singapore entity without switching systems. EOR is the right structure for a first Singapore hire, until it isn't. Teamed does not lock you in. Start from the Singapore hiring overview or run the Employer Cost Calculator to see the full picture.
Frequently asked questions
What is the employer CPF rate in Singapore in 2026?
The employer CPF contribution rate is 17% for employees aged 55 and below. The employee contributes 20%. Both rates apply to Ordinary Wages up to the monthly ceiling of SGD 8,000, raised from 1 January 2026. Wages above SGD 8,000 in a month do not attract further CPF contributions on the excess ordinary wages in that month. Lower employer rates apply for employees aged 56 and above.
How much does a Singapore hire really cost compared with the salary?
A Singapore hire at SGD 72,000 costs around SGD 84,000 in total employer cost before the Teamed fee (illustrative, based on the 17% employer CPF rate and the SGD 8,000 Ordinary Wage ceiling). That is roughly 117 percent of gross salary. The loading falls at higher salaries because the CPF ceiling caps the employer contribution at around SGD 16,320 per year on ordinary wages, regardless of how high the salary goes above SGD 96,000 a year.
How much annual leave must a Singapore employer provide?
Every Employment Act employee gets 7 days of paid annual leave in their first year. The entitlement increases by one day per additional year of service up to 14 days from year eight. Employees also get 11 paid public holidays in 2026. Unlike some other countries, annual leave and public holidays are counted separately in Singapore.
Is the Annual Wage Supplement mandatory in Singapore?
The Annual Wage Supplement (commonly the 13th-month bonus) is not legally required for all employees unless it is written into the employment contract or collective agreement. In practice it is near-universal in Singapore and most employers factor it in as an expected cost. It also attracts CPF contributions up to the Additional Wage ceiling for the year (SGD 102,000 minus ordinary wages already subject to CPF). Budget for it as a de facto cost even where it is not strictly mandated.
When does an employee become entitled to retrenchment benefits in Singapore?
An employee with 2 or more years of service is entitled to retrenchment benefits if made redundant. The prevailing norm is 2 weeks of pay per year of service at the lower end, up to one month per year at the higher end. There is no statutory cap on total retrenchment benefits. The benefit is calculated on ordinary wages and is separate from any notice pay owed.
The CPF ceiling catches people out in both directions. Some clients assume CPF applies to the full salary and over-budget. Others forget that the Annual Wage Supplement is a near-universal expectation in Singapore and that the 13th month also attracts CPF up to the Additional Wage ceiling. Model both sides before you send the offer.
Singapore CPF is 17% on ordinary wages. But it stops at SGD 8,000 a month. Most cost models miss the ceiling.
Add the Annual Wage Supplement expectation, 7 days of leave rising with tenure, and 11 public holidays, and the full picture is wider than the headline rate.
Know every line before you send the offer.
