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MediSave Contribution Formula:
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MediSave is a component of the Central Provident Fund (CPF) in Singapore that helps self-employed persons save for their healthcare expenses. Self-employed individuals are required to contribute a percentage of their net trade income to their MediSave account.
The calculator uses the MediSave contribution formula:
Where:
Explanation: The calculation multiplies your net trade income by the applicable contribution rate to determine your annual MediSave contribution amount.
Details: Regular MediSave contributions ensure that self-employed individuals have adequate savings for healthcare needs, including hospitalization expenses and approved medical treatments. It's a mandatory requirement for self-employed persons in Singapore.
Tips: Enter your net trade income in Singapore dollars and the applicable contribution rate as a decimal (e.g., 0.08 for 8%). Both values must be valid (income ≥ 0, rate between 0-1).
Q1: Who needs to pay MediSave as a self-employed person?
A: All self-employed persons in Singapore with an annual net trade income exceeding $6,000 are required to contribute to MediSave.
Q2: How is the contribution rate determined?
A: The rate depends on your age and income level. The Central Provident Fund Board (CPFB) publishes the current rates each year.
Q3: When are MediSave contributions due?
A: Contributions are typically due annually after filing your Income Tax Return. The CPFB will notify you of the amount payable.
Q4: What happens if I don't make MediSave contributions?
A: Failure to contribute may result in penalties, interest charges, and potential difficulties in accessing healthcare subsidies.
Q5: Can I make voluntary contributions beyond the required amount?
A: Yes, you can make voluntary contributions to your MediSave account, subject to the prevailing contribution caps.