How Well Do You Know Your Pay Check?
Last updated: 2021-05-31 (originally published on 2017-11-20) — by Alex Tanglao
As HR professionals, we are definitely experts when it comes to pay checks. However, when it comes to employees, could we say the same?
Based on a quick survey conducted by Complete Payroll via Facebook on how well an individual knows about their payslip, majority of the people are seemingly very familiar with their own payslip or at a complete loss as to what their payslip entails. Most people are aware that their payslips would include their gross salary and Central Provident Fund (CPF) contributions. Partly because these are mandatory contributions, therefore most would be aware of these deductions.
However, when one does the math, there are actually other deductions that most people might not even be aware of. It might range from a small figure of two dollars to a substantial amount of thirty dollars – but where do these deductions actually go to then?
Given that most of us tend to simply take the payslip without really scrutinising how much and what is exactly paid and deducted, this could at times result in over-payment or even under-payment of wages. Essentially, it is important to know where your money is going in order to better plan and work out your savings.
On 1 April 2016, the Singapore Government mandated that employers must issue itemised payslips to all employees covered by the Employment Act. Regardless of whether the payslip is issued in soft or hard copy, it has to detail all payments made as well as deductions for the employee.
Certain deductions which employees might not be aware of are contributions to self-help groups (SHG). Depending on the race of the individual, the SHG contributions differs accordingly. Essentially, the SHG funds are the Chinese Development Assistance Council (CDAC), Eurasian Community Fund (ECF), Mosque Building and Mendaki Fund (MBMF) and Singapore Indian Development Association (SINDA) fund. Moreover, depending on which bracket of income that an individual falls within, the contribution rates differ accordingly. The higher one’s monthly gross salary, the higher the SHG contribution.
Another deduction which employees have to be aware of would be CPF contributions. Majority of the workforce would likely fall under the 55 and below age bracket, which corresponds to a 17% and 20% CPF contribution by the employer and employee respectively. However, once an employee is above 55 years of age, the contribution rates by both employer and employee varies accordingly.
To conclude, do not simply rely on the HR department when it comes to wages. After all, the company’s payroll is still checked and reviewed by humans, whom are inevitable to make even the slightest mistakes. It is best to always understand what your pay check is telling you – that way, you can also ensure that you are being compensated the right amount of wages at the same time!
This a guest post by RenQun Huang of Gpayroll. The views expressed here are of the author’s, and Zegal may not necessarily subscribe to them. You, too, are invited to share your point of view. Learn more about guest blogging for Zegal here.
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