Tax saved by contributing to SRS.
Tax saved
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Eligible contribution
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Your breakdown
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The deferral that SRS is really selling you
The Supplementary Retirement Scheme is the only voluntary lever most Singapore residents have to push income out of a high-tax year and into a lower-tax future. Every dollar you put in is subtracted from your chargeable income, so the saving is not a flat percentage. It is your marginal rate, the rate on your top dollar of income. That is why this tool asks for two things only: how much you contribute and what slice of the resident table your income reaches. A taxpayer whose top dollars sit in the 11.5 percent band saves far less per dollar than one whose income pushes into the 22 percent band, even with the identical contribution.
SRS is not a giveaway. You are deferring tax, not erasing it. When you withdraw at the statutory retirement age that applied when you opened the account, only half of each withdrawal is taxable, and you can spread withdrawals across ten years to keep each year’s slice small. Done well, a retiree with little other income can pull money out at a near-zero effective rate. Pull it early, before that age, and IRAS taxes the full amount and adds a 5 percent penalty, which usually wipes out the original benefit.
A maxed-out citizen contribution, traced through
Take a Singapore citizen who contributes the full $15,300 cap and whose top income sits in the 11.5 percent bracket. The tool multiplies the eligible amount by that marginal rate. Note that local dividends and capital gains never enter this picture, because Singapore has no capital gains tax and runs a one-tier system, so SRS relief is purely about your employment and other taxable income.
That $1,760 is real cash kept out of IRAS hands this filing season, and the $15,300 is still yours, invested inside the SRS account. The chart shows where it lands: the great majority of the contribution stays invested, with the tax saved as the slice you would otherwise have surrendered.
Where the cap and the foreigner rate change the math
Foreigners face a higher ceiling of $35,700 because they have no CPF to lean on for retirement. Switch the status dropdown and the tool swaps the cap, but the logic is the same: contribute above your cap and the excess gives no relief at all, which is the one mistake I see most often. People round up to a tidy number and lose nothing in tax on the overshoot. SRS also lives under the overall $80,000 personal income tax relief cap, so if your CPF, child, and other reliefs have already filled that ceiling, an SRS top-up can save you nothing on paper even though the money still goes in.
A practical tip: contribute late in the calendar year once your income is known, not in January when a bonus or job change might still move your marginal band. The deduction lands in the same Year of Assessment regardless of the month you pay in.
Should I contribute if I am in the lowest tax bands?
If your chargeable income is under $20,000 you pay no tax, so an SRS contribution buys zero relief and simply locks money away until retirement age. Around the 2 to 3.5 percent bands the saving is thin and the loss of liquidity rarely justifies it. SRS earns its keep once your top dollars reach the 11.5 percent band and above.
Can I invest the money once it is inside SRS?
Yes, and you should. Cash sitting in an SRS account earns a token interest rate. The account is a wrapper: you can buy Singapore Savings Bonds, T-bills, unit trusts, shares, and approved insurance from it, and any growth compounds without a capital gains tax in Singapore. Leaving it as idle cash is the second common mistake, right after overshooting the cap.