This article was produced in collaboration with the Ministry of Finance and updated on 27 February 2020 with the latest information. All views expressed in this article are the independent opinion of DollarsAndSense.sg.
Most of us are aware that lower-income households in Singapore receive various government grants and subsidies. However, fewer may realise that many of these benefits extend to middle-income households, who can also receive a considerable amount of support.
In this article, we highlight some of the most important grants and subsidies for middle-income households in Singapore.
Some schemes are pegged to one’s monthly household income, with lower-income households receiving more support compared to higher-income households. The approach taken is to extend most help to those who need it more. However, others are given to all Singapore households regardless of income.
Before we start, let’s first establish what constitutes a middle-income household in Singapore.
According to the Department of Statistics, the median resident household income in 2017 in Singapore was $6,913 (excluding employer’s CPF contribution). This serves as a good benchmark in this discussion. You can refer to Table 18A in this link for the stats.
Let’s look at some of the grants and subsidies that such a household may be eligible for.
- HDB housing grants
- GST Vouchers – U-Save
- Baby grants
- Childcare subsidies
- SkillsFuture credit
- Healthcare Subsidies
With 8 in 10 Singaporeans living in public housing, buying an HDB flat is a major financial decision for many households. To support aspirations for homeownership, the government provides significant grants for first-time applicants.
New Enhanced CPF Housing Grant (EHG): Previously, the Special CPF Housing Grant (SHG) was applicable to first-time home buyers buying a 4-room or smaller BTO flat in a non-mature estate, should their average gross household monthly income be up to $8,000.
For the new Enhanced CPF Housing Grant (EHG), households with an average monthly income of $9,000 or less will be able to receive the EHG. If you qualify for the EHG, and fulfil the requirements needed, you will receive up to $80,000 in grant amount depending on the gross household income.
Getting the Enhanced CPF Housing Grant (EHG) does not prevent you from applying for any other HDB grants that you may also be eligible for.
Family Grant: For resale flat buyers you can also enjoy the Family Grant (up to $50,000), with an income ceiling of $14,000 per month.
Proximity Housing Grant (PHG): A Proximity Housing Grant (PHG) of $30,000 is given to resale HDB homebuyers who plan to stay in the same flat as their parents, or within 4km from their parents.
This means that a first-time resale flat buyer can potentially receive up to $160,000 in grants.
GST Vouchers – U-Save
Lower and middle-income Singaporean HDB households can look forward to receiving quarterly rebates to help offset their utility bills. This is typically paid in January, April, July, and October each year.
Eligible households can look forward to receiving up to $1,000 in GST Vouchers (U-Save) this year. As announced in Budget 2020, eligible households will receive a one-off U-Save Special Payment on top of their regular U-Save vouchers. Larger households with 5 or more members will get a further rebate.
The rebates will be credited to the HDB flat’s utilities account. According to Budget 2020 figures, here’s what HDB households can expect to receive:
Baby grants in Singapore extend to all parents in Singapore, regardless of income.
Baby Bonus Cash Gift: The first grant to expect is the Baby Bonus Cash Gift for parents of newborns. The amount parents receive depends on the child’s birth order. This ranges from $8,000 (1st and 2nd child) to $10,000 (3rd and subsequent child). The Bonus is disbursed over 18 months.
Child Development Account (CDA) First-Step: Besides the Baby Bonus Cash Gift, all Singaporean children receive an initial amount of $3,000 in their CDA. The account can be used for educational and healthcare expenses at approved institutions.
CDA Dollar-For-Dollar Matching: For the first and second child, the government will make a dollar-for-dollar matching when parents top up their child’s CDA, up to $3,000. This amount increases to $9,000 for the third and fourth child, and $15,000 for the fifth and subsequent child.
MediSave Grant: All Singaporean babies will also receive a $4,000 grant in their MediSave Account. This sum is deposited in the newborn’s CPF MediSave account, which is automatically created after birth registration.
In total, a Singapore family having their first child can expect $18,000 in cash, top-ups, and grants.
To support families with young children, the government provides significant childcare support. This helps parents, including the middle-income, address the cost of childcare.
Full Day Child Care Programme: Families of all Singapore Citizen children will receive a basic subsidy of $300 per child for children enrolled in care centres licensed by Early Childhood Development Authority (ECDA).
From January 2020, the gross monthly household income ceiling for Additional Subsidy has been raised to $12,000 or $3,000 on a Per Capita Income (PCI) basis. This means households may receive up to $467 in additional subsidy depending on their eligibility.
Full Day Infant Care Programme: This household can also receive a basic subsidy of $600 for a full-day infant care programme. Depending on your eligibility criteria, households may also receive up to $710 in additional subsidy.
All Singaporeans aged 25 and above received an initial top up of $500 in SkillsFuture Credit. The amount is accumulative and further top-ups would be available periodically. These credits can be used to pay for approved SkillsFuture courses.
Through this initiative, all Singaporeans – even retirees and homemakers – are encouraged to embrace lifelong learning. This helps ensure that our population continues to develop the necessary capabilities to remain relevant in a global economy.
In the Budget 2020, the government announced a one-time top-up to the SkillsFuture Credit of all Singaporean Citizens aged 25 and above. This is above the initial $500 credit given.
In 2017, the majority of Singaporeans paid little to no cash for their hospitalisation bills after subsidies from MediShield Life and Medisave. 7 in 10 subsidised hospitalisations by Singaporeans required no cash payment, and 8 in 10 paid under $100 in cash after subsidies.
Singaporeans can receive up to 80% subsidy for hospitalisations, 70% subsidy for subsidised outpatient treatments at specialist outpatient clinics and up to 75% for subsidised treatments at polyclinics.
Healthcare subsidies ensure that Singaporeans, regardless of income, have access to quality medical care.
Knowing The Grants and Subsidies That Your Household Qualifies For Allows You To Make Better Financial Decisions
The highlighted subsidies and grants for middle-income families are by no means exhaustive. There are others which families can apply for, particularly if they require more customised assistance. The Ministry Of Social and Family Development (MSF)has an extensive list of these schemes.
The government has introduced an array of schemes to benefit Singaporean families. These schemes are designed to help households of different income and needs. By knowing what are available, plus the qualifying criteria, middle-income households can tap on the right schemes to alleviate cost of living concerns.
Are there any other useful grants and subsidies for middle-income households that we missed out? Contact us at [email protected] if you know of one and we will add it in.