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Self-employed Person

How to Calculate Contributions


SEPs have to pay 5% of their relevant income as mandatory contributions. The amount is subject to a maximum level of relevant income (i.e. $30,000 a month or $360,000 a year) and a minimum level of relevant income (i.e. $7,100 a month or $85,200 a year). If your relevant income is less than the minimum level, you are not required to make a contribution. If it is more than the maximum level, you have to contribute the maximum amount (i.e. $1,500 a month or $18,000 a year).

SEPs making contributions monthly or yearly

Relevant Income Mandatory Contributions
Annual Monthly Average
Less than $85,200 Less than $7,100 Not required
$85,200 – $360,000 $7,100 – $30,000 Relevant income × 5%
More than $360,000 More than $30,000 $360,000×5%= $18,000 per year or $30,000×5%= $1,500 per month

The current minimum relevant income level of $7,100 per month (or $85,200 per year) applies to contribution periods commencing on or after 1 November 2013 while the current maximum relevant income level of $30,000 per month (or $360,000 per year) applies to contribution periods commencing on or after 1 June 2014.

For more details on the past minimum and maximum relevant income levels, please click here.

Apart from making mandatory contributions, you may also consider making voluntary contributions in order to enhance your retirement protection.
 

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