Singapore Expats

Hi Friends

I need your inputs.my Singapore based employer has given the optional program for employees to join SRS.
If employee join SRS then he has to contribute 1200 SGD per month to his SRS account , at the same time my employer will also contribute 1000 SGD per month to that SRS account whoever opted for SRS.

I am Employment pass holder. Could you suggest if I should go for it and is it worth it. What will happen if I switch job after few years ?

So you get 12k a year extra from your employer provided you contribute at least 14.4k. And reduced tax commitment. Sounds like a good deal to me. Especially if you invest that SRS money.

What happens after you quit? Nothing - your existing SRS contributions will continue to be there and growing (if they are invested in something decent).

As a foreigner, should you choose to, you could withdraw without penalty before the statutory retirement age if you have crossed 10 years and you withdraw the full amount.

RVP wrote: ↑

Wed, 23 Oct 2024 12:36 pm

Hi Friends

I need your inputs.my Singapore based employer has given the optional program for employees to join SRS.
If employee join SRS then he has to contribute 1200 SGD per month to his SRS account , at the same time my employer will also contribute 1000 SGD per month to that SRS account whoever opted for SRS.

I am Employment pass holder. Could you suggest if I should go for it and is it worth it. What will happen if I switch job after few years ?

Even if you break the kitty before 10 years and pay full taxes plus the 5% penalty… $1k / $2.2k is 45%; you’re still well ahead versus forfeiting the employer contributions.

This is a no brainer. Your only question should be: where do I sign?

My last MNC had something similar. It was hugely popular with people who could read.

What is WP?

Unless your employer is contributing, SRS as a tax favorable scheme is not super compelling to foreigners who have the discipline and the savvy to invest in an ordinary taxable account (which is already super compelling for Singapore tax residents).

Remember, by contributing to SRS, you are potentially exposing capital gains to future taxation in an SRS that would otherwise go tax-free outside SRS. Also, being restricted to local investments will typically incur higher fees that compound over time and could eat away any tax savings versus investing outside SRS. This is especially true for those who plan to retire outside Singapore and will end up paying the non-resident rate.