MediSave for Self-Employed: Who Qualifies and What You Get
Learn if you must contribute to MediSave as a freelancer and how these mandatory savings can help cover your future healthcare costs.
This scheme requires self-employed individuals to set aside specific funds to cover future medical expenses through mandatory savings.
Who it's for
This scheme is specifically for self-employed persons working in Singapore. To qualify for this requirement, you must earn an annual net trade income that is above $6,000. If your earnings fall below this specific threshold, the mandatory contribution rules for this healthcare savings account may not apply to you in the same way.
What you get
The primary benefit is the creation of a dedicated savings account intended to help you manage and pay for your future healthcare needs. By contributing to this account, you are building a financial cushion for medical expenses. Furthermore, these contributions are not just for medical use; they also provide tax relief, which can help lower your taxable income and reduce the amount of tax you owe.
What it costs you
The cost involves making annual contributions to your account. The exact amount you must contribute is not a fixed flat fee; instead, it is calculated based on your net trade income for the year. To manage these payments and track your savings, you will need to use your Singpass to access the necessary government services.
The catch to know
A common issue for many freelancers and independent contractors is that they often forget to make these contributions on time. It is very common for people to overlook their obligation to contribute until they receive an official notice regarding their requirements. Staying proactive with your financial planning is important to avoid being caught off guard by these annual notices.
How to apply
- Determine your total annual net trade income from all your self-employment activities.
- Confirm that your income meets the minimum threshold required for mandatory contributions.
- Log in to the official portal using your Singpass digital identity.
- Follow the instructions on the official website to complete your contribution: https://www.cpf.gov.sg