How to maximise personal tax relief in Singapore

It's surprising how many people in Singapore miss out on maximizing their tax breaks because they rely solely on their company to handle it. Beyond our CPF, there's a scheme called the Supplementary Retirement Scheme (SRS) that everyone—Singaporeans, PRs, and even foreigners—can benefit from.

The SRS is a voluntary savings scheme designed to boost your retirement savings while providing you with tax relief. Here's how it works: For every dollar you contribute, you get a dollar-for-dollar tax write-off. It's an account you can open with DBS, OCBC, or UOB.

For Singaporeans and PRs, you can contribute up to $15,300 per year, while foreigners can contribute up to $35,700 annually. This can significantly lower your taxable income and potentially drop you into a lower tax bracket.

For example, if your taxable income is $80,000, you'd typically pay $3,350 in taxes. But if you contribute $15,300 to your SRS account, your taxable income drops, and you'd only pay $2,279 in taxes. That's a savings of $1,071.

However, there are some rules to be aware of. You can only withdraw the money when you turn 63 years old. If you withdraw it earlier, you'll be taxed 100% on the amount withdrawn, plus a 5% penalty.

One of the great things about the SRS is that you can invest your contributions in a wide range of options, from commodities to unit trusts, to grow your savings even more.

Here's an article from the DBS website for you to find out more.