Guide: Making Use of Tax Payment Promos With GIRO Payment Plan

When it comes to making payment for our various taxes, there are 2 things taxpayers can take advantage of for their tax payments. One, the 12-month interest-free payment plan that IRAS offers to taxpayers. Two, the various tax payment promos that are offered by various banks and companies.

Here’s how to make use of both concurrently.

Setting Up GIRO Payment Plan

If you have not already done so in previous years, you will need to set up a payment plan. IRAS has guides on the various methods possible.

Once the payment plan is set up, IRAS website will display an overview of the payment amounts each month over the next year.

Making payments ahead of GIRO deduction

According to IRAS, deductions are made on the 6th of each month. If the deduction fails, another attempt would be made on the 20th. If either day falls on a weekend or public holiday, the deduction would be made on the next working day.

If you make payment manually to IRAS in time before the GIRO deduction date, your balance will fall and a lower amount will be deducted from your bank account in the following deduction.

For instance, someone with a monthly payment plan of S$400 will see this as their payment plan over the next few months:

Payment Month	Amount (S$)	Amount Paid (S$)	Balance (S$)
May 2025	S$400	S$0	S$400
June 2025	S$400	S$0	S$400
July 2025	S$400	S$0	S$400

If the person makes a payment of S$233.33 before May 2025 deduction, this would happen:

Payment Month	Amount (S$)	Amount Paid (S$)	Balance (S$)
May 2025	S$400	S$233.33	S$166.67
June 2025	S$400	S$0	S$400
July 2025	S$400	S$0	S$400

This is provided the payment is in advance of the GIRO deduction date as it takes a few business days for things to be updated. If you are using services like CardUp, ipaymy, or Citi PayAll, those take a few working days to process too, so make sure to pay well ahead of the GIRO deduction date.

In any case, if the person made their payment too late for the GIRO deduction to be updated, May 2025’s deduction would be the full S$400 with the S$233.33 paid manually credited to June 2025’s balance instead.

Benefits

There are two main benefits to using a tax payment plan this way. Firstly, it allows you to stretch your cashflow over a period of 12 months which is financially advantageous given that it is interest-free. All things equal, you would rather split a payment over a year without interest rather than paying it upfront.

The second benefit is that you can make use of tax payment promos. Setting up your tax payment plan with HSBC EGA gets you 1% cashback on the payment, or as much as 6.5% with UOB’s promo assuming you meet these promo requirements.

Mix n’ Match different promos

Mixing and matching different promos is also possible — our hypothetical person above could pay S$233.33 each month with CardUp, ipaymy, or Citi PayAll, settle their credit card bills with HSBC EGA, then leave the remaining S$166.67 amount to be deducted from their UOB One account to take advantage of UOB’s tax payment promo.

Since UOB’s promo has certain caps, one can easily make payment manually before each GIRO deduction date to “prune” the GIRO deduction amount for optimal rewards (see UOB’s tax payment promo for max tax amounts for cashback). The various payment promos also allow for recurring payment plans, so you can set this up once and leave it to run automatically.

Stay subscribed for an upcoming piece on how I’m optimising my tax payments.

Considerations for/against lump sum payment

I know some might prefer to pay their tax in a lump sum instead for a variety of reasons. Perhaps they are concerned that tax payment promos or certain methods might change over time. Some could also be trying to reach their credit card spending, or simply desire a peace of mind that their tax obligation for the year is done and settled.

These aren’t terrible reasons, but do note that there are opportunity costs to paying off your tax bill upfront. Based on my calculation, if your funds can sit in an account earning 3% p.a. interest, the opportunity cost of making a lump sum payment is approximately 1.40% on the amount.

For example, if you are paying S$12,000 upfront, you would forgo roughly S$168 of interest that you could have earned by leaving the sum in a bank account giving 3% p.a. with S$1,000 monthly deductions.

Interest Rate	2% p.a.	3% p.a.	4% p.a.
Approximate Opportunity Cost	0.93% on lump sum	1.40% on lump sum	1.87% on lump sum

Interest rates are declining so this opportunity cost may lessen over the next year, but it is still something to take note of if you’re considering a lump sum payment instead.

What’s the best tax promo to use?

Tax promos this year has been a little special with UOB throwing its hat into the ring, so it’s taking a bit more time for me to decide which promo to take advantage of. I will lay out my considerations on how I’m paying my tax bill over the next year in a content piece coming really soon, so stay subscribed for updates!

Seth Wee was a licensed financial adviser representative from 2009 to 2025, with over 16 years of experience in Singapore’s financial advisory industry.

He started Sethisfy.com in 2019 to share practical insights on credit cards, banking products, and miles strategies, helping readers identify financial products that deliver the best value. Seth has been featured in CNA, Channel 8, Today, and a host of other publications. In 2025, he was also part of a panel at CPF’s Ready For Life festival.

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