Wages that are due or granted to an employee (wholly and exclusively) with respect to that employee's employment for the month.
Wages that are payable before the due date for payment of CPF contributions for that month. (14th of every month).
Examples of this would be Monthly Basic Salary and Fixed Allowances.
The amount of Ordinary Wages that attract CPF contributions each month is capped at $6,000.
Wages not granted wholly and exclusively for the month - made at intervals of more than a month.
Examples of AW would be Annual Bonus, Leave Pay, Commissions.
The amount of CPF contributions payable on AW is capped at $102,000 minus the total ordinary wages subject to CPF for the year. (Additional Wage Ceiling)
This Additional Wage ceiling is applied anew for each new employer in a year.
In Talenox, the pay items chosen and keyed into payroll are automatically categorised into Ordinary and Additional Wages accordingly. Generally, these are the classifications:
Monthly Payment/Deduction tab pay items
All pay items except 2 under this tab are grouped as Ordinary Wage.
Only "Bonus" and "Commission (AW)" pay items under this tab are grouped under Additional Wage.
Ad Hoc Payment/Deduction tab pay items
Pay items like "Allowance", "Deduction", "Housing/Rental Allowance", "Meal Allowance" and "Tips" are all considered Ordinary Wage.
Every other pay item under this tab are categorised under Additional Wage.