What can I invest in using my SRS account in Singapore?

SRS Investment Options and Limits for Singaporeans

The Supplementary Retirement Scheme (SRS) is a voluntary scheme designed to help you save more for retirement with tax advantages. For Singapore Citizens and Permanent Residents (PRs), the annual contribution cap is SGD 15,300 (IRAS).

Low Interest Rate & Investment Necessity

Unlike CPF accounts, SRS funds earn a very low interest rate of only 0.05%. Therefore, it is crucial to invest the funds to achieve meaningful growth. You must invest your SRS contributions.

Eligible Investment Products

You can invest your SRS funds in a variety of instruments, including:

• Insurance annuities
• Stocks
• Exchange Traded Funds (ETFs)
• Real Estate Investment Trusts (REITs)
• Singapore Government Bonds (SG bonds)

Tax Benefits and Withdrawal Rules

Contributions are tax-deductible up to the annual cap. The key benefit is the tax deferral upon withdrawal. Your withdrawal age is determined by the statutory retirement age when you opened your SRS account (currently age 63 if opened now). You have a 10-year withdrawal window after reaching that age.

• After Retirement Age: Only 50% of the withdrawn amount is subject to income tax.
• Example of Zero Effective Tax: If you withdraw SGD 40,000 per year after retirement age, the first SGD 20,000 is tax-free, and the remaining SGD 20,000 is taxed at 50% (taxable amount SGD 10,000), resulting in effective zero tax on the first SGD 40k if your marginal tax rate is low enough or structured correctly.

Important Timing Consideration

To lock in the current statutory retirement age of 63, you must open your SRS account before 1 July 2026 (IRAS/CPF Board guidance).

Penalties for Early Withdrawal

If you withdraw funds before reaching the statutory retirement age, the entire amount withdrawn is subject to income tax, plus an additional 5% penalty. However, there is an exception: if you withdraw the amount contributed in the same year before December 31st, the 5% penalty is waived, though the 100% tax still applies.