SRS Calculator – Should You Use SRS?

The Supplementary Retirement Scheme (SRS) is a really useful tax deferral scheme that can help Singaporeans (and Singapore-based residents), but figuring out the actual benefits can be a little difficult.

This is made more complex that there are actually some downsides to using it under some conditions, so I’m making this calculator to help answer the question – should you use SRS?

The main considerations when it comes to using SRS

While SRS is a wonderful tax deferment tool, there are a couple of things we need to take note of before contributing to the account. The main issues with the account are:

1. Liquidity
2. A “capital gains tax”

I have done a couple of articles (part 1 and part 2) and a video on the topic of SRS before, so you can refer to them for more elaboration.

Open (and fund) your account by 30th June 2026 to lock in an earlier penalty-free withdrawal age

SRS accountholders can withdraw their SRS funds without penalty when they reach their statutory retirement age. This is based on the date of the account’s first deposit so I think it is better to do so by 30th June 2026 even if you have no immediate plans to use it. All it takes is some time to open the account and S$1 to fund it.

The retirement age will increase from 63 to 64 from 1st July 2026 onwards, and further increase to 65 some time in 2030.

Calculator

To use the calculator, simply:

1. Input your annual income before reliefs
2. Edit your tax reliefs, if needed (CPF is auto-calculated, but you can make changes accordingly)
3. Drag the slider to select input your Annual SRS Contribution

The calculator will show you the estimated tax savings you can get.

Advanced Mode – SRS vs normal investing

The Advanced Mode allows users to compare between:

1. Normal investing: just invest cash minus any tax payable each year
2. SRS strategy: contribute to SRS, then use the full amount to invest (since this amount will be tax free)

For instance, based on the default values of someone earning S$120,000 a year with S$20,200 of tax relief, the net benefit of SRS can be 11.2% superior to not using the account.

Reduce the annual income to S$60,000 with S$13,000 of tax relief and you can see that SRS might not be that attractive. Such a profile may save on tax now, but after accounting for taxes during the withdrawal period, SRS is just 3.7% better than if the person had just paid his taxes and invested the sum via cash.

Playing around with the calculator will also show you scenarios where a person would actually be worse off using SRS.

Why is there tax on withdrawal?

As a reminder, SRS withdrawals after the statutory retirement age is not tax free. Instead, 50% of any amount withdrawn are taxable. Someone withdrawing S$40,000 will be taxed as if they had a S$20,000 income, which is currently 0% based on existing tax brackets. A person who withdraws S$80,000, on the other hand, will be taxed on S$40,000.

This also creates a “capital gains tax” because any growth of one’s SRS savings is also subject to this taxation upon withdrawal.

However, it doesn’t mean you should only restrict yourself to tax-free withdrawals. The calculator should highlight clearly that an SRS strategy can be very beneficial even with tax payable during the withdrawal period, provided your income is high during your contributing years.

What helps with increasing the benefit of SRS?

Factor	Impact on SRS Benefit
Income	The higher your income during your contribution years, the more beneficial SRS becomes.
Withdrawal Period	The longer you are able to draw down on your SRS savings, the more beneficial SRS becomes. The maximum is 10 years.
Returns	The higher annual investment returns generally reduce the relative benefit of SRS.

Generally, the higher your income, the better SRS is for you. This is commonsensical – a higher income corresponds to a higher tax rate, and that means greater tax savings with SRS.

For withdrawal periods, it also makes sense that the longer you can stretch out your SRS withdrawals, the less tax you will incur each year. This would make SRS more beneficial.

The less obvious thing to note would be that a higher annual investment return would result in relatively less benefits from SRS. Why? It’s because of the “capital gains tax” created as a result of money growing within the SRS account which can be taxed upon withdrawal. This doesn’t necessarily mean that a higher return is bad, or that high investment returns are incompatible with SRS investing.

You can try this for yourself – change the 6% p.a. return to 12% p.a. return. With other values being default, you will see that the gap between cash investing and SRS investing has narrowed from SRS being 11.2% better to 6.8% better. This is because cash investing, with taxes paid upfront and having no tax on any capital gains, is starting to chase up with SRS investing.

Should someone who is confident of more returns than look at just cash investing? Not really, as you can see from the calculator, the absolute amount of benefit SRS can give has also increased from S$116,325 to S$242,052. It is because at 12% p.a., both portfolios have grown quite large such that S$242,052 is a smaller percentage than S$116,325 is at a lower rate of return. Whether you would want more money during your retirement years or more access to your funds would be a matter of preference.

Not liable for any loss or opportunity cost

I hope it is obvious, but I think I need to reiterate that nothing on this site, including this calculator, constitutes financial advice. There is no liability for any loss or opportunity cost if you decide to do anything based on materials you find here, so do your own due diligence before making any financial decision.

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Of course, we have yet to talk about instruments you can use to put your SRS funds to use. That is coming soon, so stay subscribed to the Telegram or WhatsApp for updates. Remember to unmute and turn on notifications or the updates may not reach you.

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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