Contribute to your SRS account and reap tax savings!
25 November 2019
Many people are still unfamiliar with the Supplementary Retirement Scheme (SRS). After all, unlike CPF, it is not compulsory, and requires you to make the effort to open an SRS account and then remember to contribute to it each year.
The Inland Revenue Authority of Singapore (IRAS) website describes the SRS as follows:
“The Supplementary Retirement Scheme (SRS) is a voluntary scheme to encourage individuals to save for retirement, over and above their CPF savings. Contributions to SRS are eligible for tax relief. Investment returns are tax-free before withdrawal and only 50% of the withdrawals from SRS are taxable at retirement.”
So, reduce your taxes by contributing to your SRS account before 31 December 2019! After all, who doesn’t want to pay less to the taxman? There is a maximum contribution of $15,300 for Singapore Citizens and PRs, and $35,700 for foreigners, but reducing your taxable income by that amount could help you drop to a lower tax bracket!
But don’t just leave your monies in the SRS bank account, as it could be sitting there earning almost zero interest for a very long time. Talk to us about how you can make the most of your SRS monies, e.g. by buying a retirement annuity or investing it, choosing from a range of strategies to suit your investment preference and risk tolerance – the goal of which is to grow this amount over time.
Do speak to your adviser on how best to put your SRS savings to work. You can also visit the IRAS website for more information.
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