CPF SA

[TiedInsurer]

2) I already suggested that they reach CPF directly to check for employer side but they insisted that I do it myself (implying that I would be a self-employed/contractor status)

That's not how you determine if somebody is a contractor/self-employed. Generally, to be recognised as such, you need to provide the tools and equipment of your own trade. If they provide you with an office, and buy you a laptop for you to use, IRAS is unlikely to accept that you are self-employed. To qualify as such you would have to pay for almost all the things needed for you to do your work. Grab/foodpanda etc exploits this loophole by making their "workers" buy or rent their own transports, uniforms, bags etc. If you are misclassified, there will be penalties for your employer.

1) Tax implications?
2) A typical employer in Singapore will just factor 20% [Employee side] into the salary, and 17% [Employer side] usually company's admin/finance will take care --- If company wants me to contribute to CPF myself, does that mean they need to include all 37% of CPF into my salary, and thus every month I contribute accordingly myself as a self-employed?

1) You pay your own income tax. The company pays their own corporate tax. Unless you are somehow able to convince IRAS that you are a contractor, not a worker. Since you mentioned that you are the first employee here, who will be the company director? Singapore law requires that you have a local Singaporean director, so you can try proposing to be the director. Then the company can pay you no salary. Director fees only. You don't need to pay CPF on Director fees.
2) This one you would have to talk to the company yourself to know what their expectations are.....

Anyway, I'm a trained accountant, and am proficient with Singapore payroll, taxation and accounting. I also have experience dealing with secretarial matters, so there's that. If you need to hire somebody to work through these for you, I can offer my services. Just PM me. If you just have general questions, can just continue asking here or maybe make a new thread and I'll reply if it's simple enough, though i take no responsibility for all claims and representations I make here, and they do not constitute professional advice.

 

[Andrew833]

Still have more than 10 years till 55. No point thinking too much about shielding now isnt it?

Prepare early, you can earn more compound interest in your SA.
I didn't know about shielding then but I have invest in UT, so not so bad.

 

[hmyoth]

Do full housing refund can be pretty substantial, assuming the flat is 500k, divide by 2, will be 250k plus accrued interest, at least 300k above......nevertheless the 2.5% still better then most FD rates.

My full housing refund including accrued interest abt 111k cos I bought my flat many years ago. With low interest rate ... OA is a good option to park my saving. Anyway I m 56 this year and already set aside FRS, in case I need $ , I still can withdraw from my OA/SA.

 

[henrylbh]

My full housing refund including accrued interest abt 111k cos I bought my flat many years ago. With low interest rate ... OA is a good option to park my saving. Anyway I m 56 this year and already set aside FRS, in case I need $ , I still can withdraw from my OA/SA.

For those above 55 and have met FRS in RA, there is no better savings or FDs accounts to park your money than CPF, assuming that one is averse to investments involving risk, however little it may be.

 

[henrylbh]

That's not how you determine if somebody is a contractor/self-employed. Generally, to be recognised as such, you need to provide the tools and equipment of your own trade. If they provide you with an office, and buy you a laptop for you to use, IRAS is unlikely to accept that you are self-employed. To qualify as such you would have to pay for almost all the things needed for you to do your work. Grab/foodpanda etc exploits this loophole by making their "workers" buy or rent their own transports, uniforms, bags etc. If you are misclassified, there will be penalties for your employer.

Unlikely he has a normal employment letter. He is paid an agreed compensation, whether monthly or annually, to do what is required and agreed upon with the foreign company and he is on his own basically.

Whatever risk or contravention has nothing to do with the foreign company except what is spelt out in the contract or whatever written agreement.

 

[SUVperb]

For those above 55 and have met FRS in RA, there is no better savings or FDs accounts to park your money than CPF, assuming that one is averse to investments involving risk, however little it may be.

Hi seniors
Am 55+ and has FRS in RA,124k OA,30K in SA.60k in MA.i have about 80k spare cash and would like to know is it wise to refund my accrued hdb interest or leave it?not thinking of downgrading atm.
I still have outstanding hdb loan of about 50k.
Was thinking btw to pay my flat fully OR pump my 80k spare to pay accrued hdb interest OR grow my money in cpf?
Please advise seniors.APPRECIATE ALL Views thanks!

 

[hmyoth]

For those above 55 and have met FRS in RA, there is no better savings or FDs accounts to park your money than CPF, assuming that one is averse to investments involving risk, however little it may be.

Yes. Stock is high risk. No longer has the gut to play unless got good IPO. VC every year if I can afford it and build up my OA/SA. Is never too late .

 

[lifeafter41]

Yes. Stock is high risk. No longer has the gut to play unless got good IPO. VC every year if I can afford it and build up my OA/SA. Is never too late .

If you are still working or run your own business then it’s not a problem to continue with VC.

What’s your target plan for OA/SA interest a year, post 55.......

Knowing now that the interest can be withdrawn first, if the need arises.

 

[crimsontactics]

Hi seniors
Am 55+ and has FRS in RA,124k OA,30K in SA.60k in MA.i have about 80k spare cash and would like to know is it wise to refund my accrued hdb interest or leave it?not thinking of downgrading atm.
I still have outstanding hdb loan of about 50k.
Was thinking btw to pay my flat fully OR pump my 80k spare to pay accrued hdb interest OR grow my money in cpf?
Please advise seniors.APPRECIATE ALL Views thanks!

Are you planning to sell your HDB?

Sent from . using GAGT

 

[NewInvestor]

If you are still working or run your own business then it’s not a problem to continue with VC.

What’s your target plan for OA/SA interest a year, post 55.......

Knowing now that the interest can be withdrawn first, if the need arises.

If possible, I will leave all my CPF there post 55 years old. FD rates are at about 0.9%. CPF rates are better at this time.

 

[crimsontactics]

If possible, I will leave all my CPF there post 55 years old. FD rates are at about 0.9%. CPF rates are better at this time.

Must depend on your investing abilities as well.

Some people are able to make a better return outside of CPF and should withdraw the cash from CPF to do so.

Sent from . using GAGT

 

[SUVperb]

Are you planning to sell your HDB?

Sent from . using GAGT

Posted no atm

 

[dork32]

Hi seniors
Am 55+ and has FRS in RA,124k OA,30K in SA.60k in MA.i have about 80k spare cash and would like to know is it wise to refund my accrued hdb interest or leave it?not thinking of downgrading atm.
I still have outstanding hdb loan of about 50k.
Was thinking btw to pay my flat fully OR pump my 80k spare to pay accrued hdb interest OR grow my money in cpf?
Please advise seniors.APPRECIATE ALL Views thanks!

do you see yourself using your 80k cash? if you are sure it is a no, then paying hdb is better than paying back to cpf. hdb loan is 2.6%. oa is only 2.5%.

if it is a maybe, you should remember this. once you pay back, you cannot get the money out anymore. the actual cost of holding this 50k is $50 per year. not very expensive.

the other thing to note is this. when you repay your cpf, money goes into oa. if you need cash and withdraw, it comes out from the sa. once it comes out from the sa, it is very difficult to put it back.

 

[NewInvestor]

Must depend on your investing abilities as well.

Some people are able to make a better return outside of CPF and should withdraw the cash from CPF to do so.

Sent from . using GAGT

Very true. But my investing ability is only about C-. Must practice more.

 

[SUVperb]

do you see yourself using your 80k cash? if you are sure it is a no, then paying hdb is better than paying back to cpf. hdb loan is 2.6%. oa is only 2.5%.

if it is a maybe, you should remember this. once you pay back, you cannot get the money out anymore. the actual cost of holding this 50k is $50 per year. not very expensive.

the other thing to note is this. when you repay your cpf, money goes into oa. if you need cash and withdraw, it comes out from the sa. once it comes out from the sa, it is very difficult to put it back.

Ok got u,then how can i grow my cpf with the 80k?thks!

 

[THEMIKOS]

Guess as much that it must have been a typo.

Anyways this is something i am not sure about also. At 55, RA is formed and (assume no shielding or whatever strategies that are discussed takes place here) FRS (181k) is formed using OA and SA. Is there a difference if:

1) i keep 90.5k in SA instead of transfer to RA immediately once RA is formed? Other than the allowance to withdraw the yearly interests what other benefits are there?

2) if transfer 90.5k to RA to ERS amount at 55, is there a difference between trans @ 55 vs transfer at 65? I am assuming here the difference is in payout. At 55 if u transfer, the interests are included in your payouts from 65. If u keep the 90.5k at SA and then transfer at 64.9 to select ERS, the payouts are lesser. Am i right to assume this?

3) why choose ERS when one will take 10-20 years to reach And surpass standard plans payout? That would put u at 75-85 yrs old. Curious about this.

My mistake, MA should be fix at 60k not BRS.

If you read this thread, we are talking about the decision to have FRS or ERS in RA at 55.
I'm was thinking of having ERS in RA, but the money is lock.
So split ERS in RA into FRS in RA and BRS in SA. Money in SA after 55 is not lock. You can withdraw yearly interest similar to RA monthly payout at 65.

 

[hmyoth]

If you are still working or run your own business then it’s not a problem to continue with VC.

What’s your target plan for OA/SA interest a year, post 55.......

Knowing now that the interest can be withdrawn first, if the need arises.

I just want to put more $ into OA/SA on top of my monthly employment contribution to earn the interest. I don’t think i need to withdraw from my OA /SA for now as I am still working and have enough saving to last me. Once 65 and presume I not working anymore ,I will start to receive my CPF life payout $1300 a mth. If the amt is not enough for me , then I will either take from my saving follow by my OA/SA . It’s never too late to catch-up. I didn’t know this VC thing early enough. I wish I can start earlier rather now at 56.

 

[Andrew833]

Very true. But my investing ability is only about C-. Must practice more.

Wow you C- then I how? D or F

 

[BBCWatcher]

Hi seniors
Am 55+ and has FRS in RA,124k OA,30K in SA.60k in MA.i have about 80k spare cash and would like to know is it wise to refund my accrued hdb interest or leave it?not thinking of downgrading atm.
I still have outstanding hdb loan of about 50k.
Was thinking btw to pay my flat fully OR pump my 80k spare to pay accrued hdb interest OR grow my money in cpf?
Please advise seniors.APPRECIATE ALL Views thanks!

do you see yourself using your 80k cash? if you are sure it is a no, then paying hdb is better than paying back to cpf. hdb loan is 2.6%. oa is only 2.5%.

Actually, if SUVperb has room below the CPF Annual Limit he/she can make an "all three account" Voluntary Contribution. Assuming SUVperb is under age 60, it looks like about 13.4% of the VC will end up in the Special Account. (I'm rounding down.) So, out of every $1,000, $134 will earn 4.0% interest and the other $866 will earn 2.5% interest. (The portion allocated to MediSave looks like it'll spill into the Ordinary Account.) That translates into just a little over 2.7% interest, and all these funds are liquid. And that beats accelerating repayment on a 2.6% HDB loan, especially with the Home Protection Scheme in the picture (which it is under age 60) and the possibility of a mortgage waiver in return for premature death.

So at least for the first $X, the amount of room below the CPF Annual Limit, an "all three" VC would be a better choice.

 

[SUVperb]

Actually, if SUVperb has room below the CPF Annual Limit he/she can make an "all three account" Voluntary Contribution. Assuming SUVperb is under age 60, it looks like about 13.4% of the VC will end up in the Special Account. (I'm rounding down.) So, out of every $1,000, $134 will earn 4.0% interest and the other $866 will earn 2.5% interest. (The portion allocated to MediSave looks like it'll spill into the Ordinary Account.) That translates into just a little over 2.7% interest, and all these funds are liquid. And that beats accelerating repayment on a 2.6% HDB loan, especially with the Home Protection Scheme in the picture (which it is under age 60) and the possibility of a mortgage waiver in return for premature death.

So at least for the first $X, the amount of room below the CPF Annual Limit, an "all three" VC would be a better choice.

That’s a very detailed reply BBCW thks! There’s only a lil room for VC since earning is close to Annual limit FYI
Any other suggestions with cash top up whatsoever?