AAM The Supplementary Retirement Scheme

The Supplementary Retirement Scheme (SRS)

The Supplementary Retirement Scheme (SRS) was established in 2001 and is part of the Singapore’s government initiative to help the greying population save more for their retirement. It is a voluntary scheme and unlike the Central Provident Fund (CPF) scheme, the SRS is not only open to Singapore Citizens and Permanent Residents but to Foreigners as well.

SRS only accepts cash contributions, but it can serve as an additional retirement planning tool where you could possibly save more for retirement and at the same time enjoy the following:

  • Tax relief
  • The capacity to choose where you’d like to invest your SRS contributions
  • Option to withdraw the funds before the age of retirement #

Tax relief

Contributing to your SRS account gets you a dollar-for-dollar tax discount on the amount saved to your SRS account up to the maximum yearly contributions applicable.

SRS contributions must be made by 31 December of the year or as your SRS operator requires to be eligible for SRS tax relief in the following Year of Assessment. However, we recommend that you check with your SRS bank operator about the cut-off date for monthly SRS contributions.


SRS contributions must be made by 31 December of the year or as your SRS operator requires to be eligible for SRS tax relief in the following Year of Assessment. However, we recommend that you check with your SRS bank operator about the cut-off date for monthly SRS contributions.

Investing your SRS contributions through SRS approved funds

SRS accounts have low interest rates so maximise your contributions by investing it if you plan to stay in Singapore for a long time. With a regular investment route through your SRS, you’ll earn a potentially higher interest, as your balance in the SRS account earns only 0.05% interest per annum. With the potential for higher returns and some security, investment funds are a good fit for retirement planning or any other future financial goals you may have.

Any investment returns you earned through your SRS are tax-free until you chose to withdraw, or you can reinvest your returns by using compounding interest to your advantage.

Withdrawing your SRS funds

SRS is a long-term investment plan. While you can withdraw from your SRS account anytime, 100% of your withdrawal amount will be taxed and you will also incur a 5% penalty. However special circumstances, such as medical reasons, bankruptcy or death, access to these funds without paying the penalty may be available.

Please note that the taxable amount of the withdrawal will be added to your taxable income and taxed based on the prevailing rate. If you withdraw after the Statutory Retirement Age (currently 63), 50% of the amount you withdraw is taxable. You have a period of up to 10 years to make your withdrawal from the date of first withdrawal.

If you have not withdrawn all the funds after 10 years, then the remaining balance will be taxed as a lump sum. If you decide to withdraw the funds before the Statutory Retirement Age, then 100% of the withdrawal will be subject to income tax, with an additional 5% penalty imposed.

If you are a foreigner, you can withdraw your SRS monies without the 5% penalty if you have maintained the account for at least 10 years from the date of first contribution and it is a one-time full withdrawal.

Contact us today for more information on how AAM can help to optimise your retirement income.


# Subject to tax and penalty fee



Important information

This article is intended for general circulation and for information purposes only. It may not be published, circulated, reproduced or distributed in whole or part to any other person without prior consent of AAM. This article should not be construed as an offer, solicitation of an offer, or a recommendation to transact in any products mentioned herein. The information does not take into account the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a licensed wealth manager regarding the suitability of the investment product before making a commitment to purchase the investment product. Whilst we have taken all reasonable care to ensure that the information contained in this article is not untrue or misleading at the time of publication, we cannot guarantee its accuracy or completeness. Any opinion or estimate contained in this article is subject to change without notice. The above report may contain data obtained from third parties and as such we cannot guarantee the accuracy of this data. AAM Advisory Pte Ltd is licensed by the Monetary Authority of Singapore, FA Licence no 100032.

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