SRS 20k

[sgdividends]

Actually if one earns assessable income more than 40k and planning to retire next year, it will always be beneficial to have up to 20k in SRS account right?

Since even if premature withdrawal next year, slugged with 5% but still earn at least 2.5% (7.5% tax rate minimum )?

Next year no income so 20k no income tax also?

 

[chienwei]

seems like a favorable calculation.
not sure if there is any rule stopping you from doing that.

 

[just4fun]

SRS dont have 2.5% interests... it is just normal bank interest rate. Do you mean OA?

 

[autumm]

SRS dont have 2.5% interests... it is just normal bank interest rate. Do you mean OA?

its the difference between tax rate and withdrawal penalty...

 

[SBC]

This is a wrong comparison.

When top up is done, you earn with reduced income tax.

When drawn down, there are 2 forms of penalty. First is the 5% and amounts add into your earned income.

Good to draw down if happened to take a break.

 

[sgdividends]

Actually can have more than 20k in SRS as I forgot about reliefs which can reduce assessble income when retired

 

[SBC]

Per year limit is now at $15,300.

I have accumulated > 80k in my SRS. Can be useful to complement CPF Life. Targeting CPF Life FRS only.

 

[sgdividends]

Srs can put into CPF life ?