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Glossary of CPF, payroll and tax terms
The words used on Singapore payslips, CPF statements and IRAS notices, each with a link to the page that explains it in full.
- Additional wages (AW)
- Pay not granted wholly for the month: annual bonus, 13th month, leave encashment, incentives paid at longer intervals.
- Additional Wage ceiling
- The yearly cap on additional wages subject to CPF: $102,000 minus the ordinary wages subject to CPF in the year.
- Annual salary ceiling
- The total wages on which CPF is due in a year, $102,000 in 2026.
- Assessable income
- Your income for the year after allowable expenses and before personal reliefs.
- Basic Healthcare Sum
- The cap on MediSave savings, $79,000 in 2026; contributions above it overflow to other accounts.
- Chargeable income
- Assessable income minus personal reliefs; the amount the resident tax rates apply to.
- CPF LIFE
- The national annuity that turns the Retirement Account into monthly payouts for life from 65.
- CPF relief
- The tax relief equal to your compulsory employee CPF contributions.
- Earned income relief
- A relief of $1,000 below 55, $6,000 from 55 to 59 and $8,000 from 60, capped at your earned income.
- Employment Pass (EP)
- The work pass for foreign professionals, with a qualifying salary of at least $5,600 a month for new applications.
- Full Retirement Sum (FRS)
- The default amount set aside in the Retirement Account at 55: $220,400 for members turning 55 in 2026.
- Graduated rates
- Lower CPF rates for permanent residents in their first two years of PR status.
- Local Qualifying Salary (LQS)
- The minimum pay, $1,800 a month since 1 July 2026, for a local employee to count in a firm’s foreign worker quota.
- MediSave Account (MA)
- The CPF account for hospital bills, MediShield Life premiums and approved outpatient care.
- Net trade income (NTI)
- A self-employed person’s profit after allowable business expenses, as assessed by IRAS.
- Ordinary Account (OA)
- The CPF account for housing, insurance, education and investment; the remainder of each contribution.
- Ordinary wages (OW)
- Pay due for the month and paid before the CPF due date; subject to CPF up to $8,000 a month.
- Progressive Wage Model (PWM)
- Sector wage ladders with minimum pay at each skill level, set by tripartite committees.
- Retirement Account (RA)
- Created at 55 with savings from the Special and Ordinary Accounts; it funds CPF LIFE.
- Skills Development Levy (SDL)
- An employer levy of 0.25 % of the first $4,500 of monthly wages, between $2 and $11.25 per employee.
- Special Account (SA)
- The CPF retirement account before 55; closed at 55 since 2025.
- Supplementary Retirement Scheme (SRS)
- A voluntary retirement account; contributions are tax-deductible up to $15,300 a year for citizens and PRs.
- Tax resident
- A citizen or PR living in Singapore, or a foreigner present or working 183 days or more in the year.
- Total wages (TW)
- Ordinary plus additional wages of the month; the CPF wage bands are read on this total.
- Year of Assessment (YA)
- The year in which income of the previous year is taxed: 2026 income falls in YA 2027.
Written by Radif Partners
Publisher of payroll calculators and practical guides · Singapore CPF and income tax
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Rates for 2026, last checked on