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Cap on tax reliefs preserves the fairness and progressivity of Singapore’s tax structure

16 Mar 2022




新加坡人若要在公积金特别与退休户头存更多钱,可以透过退休存款填补计划(Retirement Sum Topping-Up Scheme,RSTU)进行现金填补。根据此计划,他们每年可获得估税扣税最多为8000元。







Farah Abdul Rahim


We thank Mr Yan Shun Cai for his letter (“对个人税务的建议”, Mar 9).

Singaporeans who wish to save more in their CPF Special and Retirement Accounts can make a cash top-up under the Retirement Sum Topping-Up Scheme. Under the RSTU, they may be eligible for up to $8,000 of tax relief per year.

The Supplementary Retirement Scheme (SRS) is a voluntary scheme to help individuals to save for their retirement, over and above their CPF savings.  Contributions to SRS are eligible for tax relief, and only 50% of the withdrawals from SRS are taxable at retirement.

While we want to encourage retirement savings, we will also need to appropriately calibrate the benefits provided under RSTU and SRS. These schemes tend to benefit the individuals with greater means to make such top-ups, and who also have other avenues to save for their retirement.  The tax relief limit for RSTU was recently raised from $7,000 to $8,000 each for contributions to oneself, and contributions to loved ones (e.g. parents, grandparents). We will continue to regularly review and update these limits.

We also have a cap on all personal income tax reliefs of $80,000. We currently have 15 types of personal income tax reliefs. Each relief serves a policy objective, including encouraging retirement savings in CPF and SRS. But taken together, the tax reliefs can lead to a small proportion of individuals enjoying very large reliefs, and hence paying lower income taxes. This $80,000 cap on personal income tax relief, in place since Year of Assessment 2018, remains relevant for ensuring that our personal income tax system is fair, where higher-income earners pay more. At this threshold, about 99% of tax-resident individuals can continue to enjoy their tax reliefs without being affected by the cap. These include about 9 out of 10 claimants of Working Mother’s Child Relief. 

The Government will continue to ensure that we have a fair and progressive fiscal system in Singapore. This means that those who are more well-to-do will contribute more taxes than the benefits they receive, while those with less still contribute something, and receive more benefits in return.

Ms Farah Abdul Rahim           

Director, Communications and Engagement

Ministry of Finance