TLDR
If you’ve already met the Full Retirement Sum (FRS) but still want to enjoy tax relief through CPF cash top-ups, consider topping up your CPF-Medical Account (CPF-MA) in early January before your employer contributions come in.
The CPF-MA Basic Healthcare Sum (BHS) will increase from $75,500 to $79,000, allowing you to claim a tax relief of up to $3,500.
Who Is This For?
Those in their late 30s/40s and above who’ve already met the Full Retirement Sum (FRS) looking to claim tax relief
Why It Matters
At the start of each year, you can maximise your CPF contributions and enjoy tax relief. For 2026, the BHS will increase from $75,500 to $79,500. This is a great opportunity for those in their 40s and above who’ve already met the Full Retirement Sum (FRS) to top up their CPF-MA and claim tax relief.
What Is the Basic Healthcare Sum (BHS)?
The Basic Healthcare Sum (BHS) is the maximum amount you can hold in your CPF Medisave Account (MA). Once you reach this cap, any excess funds are automatically transferred to your Special or Retirement Accounts, depending on your age, until the Full Retirement Sum (FRS) is met. Once FRS is reached, the surplus is moved to your CPF Ordinary Account (OA).
The BHS is adjusted annually to keep pace with rising healthcare costs, but once you turn 65, it becomes fixed for life.
| Age | Year cohort turned 65 | Cohort BHS(fixed for life) |
|---|---|---|
| 65 | 2026 | $79,000 |
| 66 | 2025 | $75,500 |
| 67 | 2024 | $71,500 |
| 68 | 2023 | $68,500 |
| 69 | 2022 | $66,000 |
| 70 | 2021 | $63,000 |
| 71 | 2020 | $60,000 |
| 72 | 2019 | $57,200 |
| 73 | 2018 | $54,500 |
| 74 | 2017 | $52,000 |
| 75 and above | 2016 or earlier | $49,800 |
Source: CPF Board
CPF Cash Top-Up Scheme – Tax Relief Opportunity
Even if you’ve hit your FRS, the BHS increase creates a chance to top up your MA and enjoy tax relief.
Through the CPF Cash Top-Up Scheme, you can claim up to $16,000 in tax relief:
- $8,000 for topping up your own CPF accounts.
- $8,000 for topping up your parents’ CPF accounts (if they haven’t met FRS).
In January 2026, with the BHS increase to $79,000, you can contribute the $3,500 difference to your CPF-MA for tax relief; before your employer’s contributions come in.
Note: Relief applies only to cash top-ups, not transfers between your CPF accounts.
In addition, the 4% return on CPF Medisave and Special Account balances is considered a safe, risk-free return. This is because CPF funds are guaranteed by the government, making it one of the most secure places to contribute your savings and earn steady growth.
Practical Steps to Maximise Benefits
- Review your CPF MA balances to see if you’ve reached the cap.
- Top up early in January before your employer’s contributions arrive.
- Help your loved ones by topping up their CPF accounts for additional tax relief.
Remember, there’s a cap of $80,000 on total tax relief per year.
Summary
Take advantage of the CPF-MA BHS increase in January to claim up to $4,000 in tax relief. Topping up your CPF-MA early can boost your Medisave savings while lowering your tax burden.
If you’re already planning to grow your healthcare reserves, this is one of the simpler ways to do it more efficiently.
If you’re not sure how much room you have to top up or whether it still makes sense based on your broader tax position, feel free to reach out for a quick chat.
