老乌龟 有沒有 胡说八道?
Using the IRAS tax calculator for FY2019, I am going to simulate a very simple example based on this Singaporean worker profile.
Name: Uncle Ah Seng (UAS)
Marital Status: Single
Salary: $5,596 per month or $67,152 per year
- $1,000 (Earned income relief)
- $13,430 (CPF/Provident Fund relief)
Personal Income Tax Rebate: $200
Scenario 1 (YOLO, don't bother to top up CPF lah, Cash is KING)
Based on UAS salary, he will be paying $1,240.54 for his FY2019 taxes to IRAS after all the standard tax relief based on his profile.
Tax payable: $1,240.54
Scenario 2 (Voluntary Contributions (VC) to Medisave account)
UAS got his annual performance bonus in cash from the company he is currently working for. With his spare cash, he decided that he wants to use part of it to VC to his Medisave account.
He decided to VC $2,800 to his medisave account to claim the maximum amount of tax relief available to meet the Basic Healthcare Sum ceiling $60,000 for FY2020 as he had already met his BHS of $57,200 in FY2019.
Tax payable: $1,044.54
Scenario 3 (Retirement Sum Topping-Up (RSTU) to Special account)
UAS decided to just do a $7,000 RSTU to his special account to maximize his tax relief as he hasn't met the prevailing Full Retirement Sum (FRS) for FY2020 which is $181,000.
Tax payable: $750.54
Scenario 4 (Voluntary Contributions (VC) to Medisave account + Retirement Sum Topping-Up (RSTU) to Special account)
UAS decided to do a $7,000 RSTU to his special account as well as a VC of $2,800 to his medisave account maximize his overall tax relief.
Tax payable: $554.54
Summary of the tax payable based on different scenarios:
Scenario 1: $1,240.54
Scenario 2: $1,044.54
Scenario 3: $750.54
Scenario 4: $554.54
Depending what kind of combo you are going for, we can see that there are different level of tax savings ranges from 15.7% to 55.3% when you compared to scenario 1 for Uncle Ah Seng.
Tax savings: Between 15.7% to 55.3%
This is in addition to the CPF interest of 4% to 5% that you are going to get for the Special and Medisave accounts.
Total Returns = Tax Savings + Interest Income on additional CPF contributions.
Old Turtle love savings and the relatively good interest income from our Government.
Such a good lobang, who don't want? Old Turtle want. Tio bo? Tio bo?