CPF Transition Offset (CTO)
The CPF Transition Offset (CTO) is designed to alleviate the rise in business costs due to increasing CPF contribution rates for senior workers. The Government provides employers with a transitionary wage offset equivalent to 50% of each year's increase in employer CPF contribution rates for every Singapore Citizen and Permanent Resident worker they employ aged above 55 to 70. The offset is based on employees' monthly incomes paid up to the CPF salary ceiling. This scheme helps employers adjust to the gradual increase in CPF rates while supporting continued employment of older workers.
Eligibility Criteria
- 01
All employers that employ local employees (Singapore Citizens and Permanent Residents) aged above 55 to 70
- 02
Must have made timely mandatory CPF contributions for eligible employees
- 03
Business must be registered in Singapore
- 04
Excludes business owners, sole proprietors, partners, and shareholder-directors
- 05
Excludes local government agencies, international organisations, and unregistered entities
How to Apply
1. No application required - automatic assessment by IRAS 2. IRAS will notify eligible employers by post regarding payout amounts 3. Electronic copies available via myTax Portal 4. Employers must ensure timely CPF contributions are made 5. Set up GIRO or PayNow Corporate for automatic payout receipt
Claims and Disbursement
Automatic disbursement by IRAS: • For wages paid January to June: payout in September same year • For wages paid July to December: payout in March following year • Payments made via GIRO or PayNow Corporate only • Detailed breakdown available through myTax Portal • Appeal window: 2 months from payout date
Frequently Asked Questions
50% of the increase in employer CPF contribution rates for senior workers aged 55-70, based on wages up to CPF salary ceiling
For Jan-Jun wages: September payout. For Jul-Dec wages: March payout the following year
Via GIRO (linked to Income Tax/GST account) or PayNow Corporate. No cheques issued
Yes, complete CTO appeal form and submit within 2 months of payout date
Yes, CTO payout is taxable in the year of receipt and must be declared in corporate income tax returns
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