SRS

Supplementary Retirement Scheme (SRS) is a voluntary scheme to encourage individuals to save for retirement, over and above their CPF savings

- Max yearly contribution is $12,750

- Tax relief allowed is the actual SRS contribution made

- Can be used for investment (eg. Unit Trust). Any cash portion remaining in SRS will earn standard CPF-IA rates (ie. 0.05% pa)

- Withdrawals are penalty-free only after the statutory retirement age (currently at 62)


Eg.
- if withdrawal is after retirement age, only 50% of the withdrawal amount will be subjected to tax
- if withdrawal is before retirement age, 100% of the withdrawal amount will be subjected to tax, inclusive of the 5% penalty


- Withdrawal can be spread over 10 years from the date of your first penalty-free withdrawal.

- Based on current personal income tax rate, 1st 20k of income is tax-free .ie. to avoid getting tax, max withdrawal should be < 20k/yr