SRS contribution vs CPFSA top up and voluntary cpf contribution summary!

Last updated on March 4th, 2019 at 04:28 pm


If you are planning to get year end tax relief, consider the SRS contribution and CPFSA top up schemes.

Ideally, if you have more than enough cash-flow to lock in for retirement purposes, you can tap on both schemes and get a total of $22,300 relief ($15,300 and $7,000 respectively).

I get questions on these schemes frequently and I’ll share with you 5 quick conclusions.

Please read our previous SRS articles if you are unfamiliar with how SRS works.


What are the differences between the CPFSA top up and SRS contribution?

Self CPFSA top up (Up to $7,000) SRS contribution (Up to $15,300)
When can you cash out? If amounts above FRS, cash out at age55 Anytime but with a 5% penalty
If below FRS, then all will flow eventually to CPF Life and no cash out date. If without penalty, cash out at age62 onwards
Returns 4% interest p.a Depends on investments


Both schemes cater for retirement planning and are voluntary. CPFSA top up is the more fuss free approach.

Personally, I am keen on investing and have delivered easily 4% pa returns. Hence, I prioritise the SRS contribution for relief planning as the funds there qualify for a range of investment assets to get returns.

Five quick conclusions

1) If you are young, prioritise the SRS contribution scheme because you too can invest long term with a strategy that delivers at least 4% p.a returns.


2) Consider the CPFSA top up first which has 4% pa returns before an endowment product with SRS funds. This is unless you are conservative with investments and do not qualify for CPFSA top up relief.


3) When CPFSA relief does not apply:

A) If your CPFSA is already at $166k already.

B) If you are a foreigner, the CPFSA top up scheme is also not available.

C) If your total reliefs are more than $80,000 (Tax calculations from yr2018). The SRS contributions also do not enjoy tax relief in this instance.


4) If you are between the age of 50-55, your investment timeframe may be short. You may then prioritise the CPFSA top up scheme. Total CPF amounts above FRS can be cashed out at age 55 which may not be too far away.


5) If you want flexibility to cash out, SRS offers more flexibility. However, you should re-examine if the retirement schemes are suitable for you in the first place.


For further relief, you may explore “retirement sum top up scheme” for parents and other reliefs covered in our previous blog posts below.


CPF voluntary contributions (VC) on the other hand is capped at Annual Limit of $37,740.

It means that if you are employed, you have to check how much is contributed already by yourself and your employer.

Any VC you made in excess of the CPF Annual Limit will be refunded without interest.

Do note that it is also NOT tax deductible. Only contribution to your CPF medisave is tax deductible.

For more info click here to reach CPF link


I’ll be sharing more on CPF LIFE planning and other matters in future posts.

Do leave any questions you have in the comments section below.


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Josh Tan Jian Liang (CHFC) Principal Author

REVIEWS: https://www.josh-tan/wall-of-reviews. COMPANY: Promiseland Independent Pte Ltd. EXPERIENCE: 11years.

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