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Do you have to pay tax on withdrawals from Supplementary Retirement Scheme (SRS) in Singapore?

Contributions made to the Supplementary Retirement Scheme (SRS) in Singapore are eligible for tax relief.

Singapore currency notes, wallet and calculator on a desk, illustrating a story on paying taxes on withdrawals from Supplementary Retirement Scheme (SRS) in Singapore.
Do you have to pay tax on withdrawals from Supplementary Retirement Scheme (SRS) in Singapore? (PHOTO: Getty) (jayk7 via Getty Images)

By Dee Lim

SINGAPORE — When it comes to planning for retirement, Singaporeans have several options at their disposal, with the Supplementary Retirement Scheme (SRS) being a popular choice. However, it’s important to know about taxation on withdrawals from your SRS.

The answer to whether you have to pay tax on SRS withdrawals is not a straightforward one – it depends on various factors.

Here’s what you need to know:

What is the SRS?

The SRS is a voluntary savings scheme, over and above the Central Provident Fund (CPF) savings and contributions. Participation in the SRS is voluntary, and contributions are capped at a maximum of S$15,300 a year for Singaporeans and permanent residents. The contributions may be used to purchase various investment instruments.


Contributions made to the SRS are eligible for tax relief, which is one way to reduce taxable income. Each contribution you make earns a dollar-for-dollar tax discount on your income tax returns, up to a maximum yearly contribution of S$15,300 for Singapore citizens and permanent residents, and S$35,700 for foreigners.

Any funds in your SRS also grows with compound interest until you decide to withdraw the money in your retirement years.

Do you have to pay penalties, besides taxes, on SRS withdrawals?

While the SRS presents a tax-efficient way to save for retirement, it's essential to be aware of potential penalties associated with early or improper withdrawals – usually pegged at five per cent of the withdrawal amount. In some exceptional situations, however, a penalty is not imposed.

No penalty is imposed on these situations, but withdrawals may still be subject to tax:

  1. Where the withdrawal is on or after the prescribed retirement age – these can be spread out over 10 years from the date of the first penalty-free withdrawal to allow you greater savings.

  2. Withdrawal on medical grounds (physical or mental incapacity) or partial withdrawal on grounds of terminal illness.

  3. Withdrawal in full due to terminal illness.

  4. In the event of bankruptcy.

  5. Withdrawal in one lump sum by a foreign who has already had SRS in holding for at least 10 years prior.

How can you avoid tax on SRS withdrawal?

Typically, SRS withdrawals are subject to tax, and the rates may vary based on the amount withdrawn and the individual's tax residency status at the time of withdrawal. You can, however, minimise your tax liabilities with careful planning and these two factors in mind.


Plan your SRS withdrawals strategically and avoid early withdrawals if possible. You incur the least amount of penalties and tax if you only withdraw after retirement age, which allows for a 50 per cent tax concession at this stage. You should also consider factors like your overall income, tax residency status, and the potential impact on your tax liabilities.

Partial withdrawals: 

Instead of withdrawing the entire SRS amount at once, consider partial withdrawals to manage tax implications more effectively since you are taxed only on the withdrawn amount.

By understanding the nuances of SRS and how to maximise what it can do for your future savings, you'll have a smoother transition into your retirement years.

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