Can corporate service buyers recover the overpaid Contribute As You Earn (CAYE) contributions due to overpayment of full service fee?
If there is over-payment, corporate service buyers (CSBs) can request a full refund of the Contribute As You Earn (CAYE) contributions from CPF Board within one year from the time the contribution was credited into the self-employed person (SEP)’s MediSave Account (MA). The CSB will have to seek a refund of the remaining service fee made from the SEP directly. After receiving a refund of the CAYE contribution paid wrongly, the CSB will be required to re-submit the correct CAYE contribution via the CAYE Digital Services.
Example:
CSB A paid Mr Tan, their SEP vendor, a service fee of $120 through the bank mode. The bank deducted and paid $12 to Mr Tan’s MA and the net service fee of $108 to Mr Tan’s bank account. However, CSB A subsequently realised that the correct service fee amount agreed upon by both parties was $100. CSB A should:
- Put in a request on the CAYE digital services for a refund of the CAYE contribution ($12) by selecting the transaction that was made in error (e.g. based on Mr Tan’s NRIC and the payment reference number) and providing the relevant supporting documents.
- Seek the remaining $108 from Mr Tan directly.
- Submit another CAYE contribution transaction for Mr Tan based on the correct gross service fee of $100.
This information is sourced from CPF
Related questions
What if the Contribute As You Earn (CAYE) contribution was paid in error (i.e. paid wrong amount, or paid to the wrong self-employed person)?
How will corporate service buyers know how much Contribute As You Earn (CAYE) contribution to deduct from the service fee?
Under what scenarios will monies transmitted via Contribute As You Earn (CAYE) bank mode be returned to the corporate service buyer?
Under Contribute As You Earn (CAYE), corporate service buyers will only pay the net service fee directly to self-employed persons. Are there any legal implications?
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