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Anonymous

29 Oct 2021

∙

Contributing to CPF for Tax relief.

Can the community give me precise instructions on

1) how much contribution my spouse and I can make

2) and in which account

to take advantage of the CPF tax relief?

Mine

SA – 80K

Medisave – 63K

Spouse

SA – 31k

Medisave – 35 k

For both my spouse and me, This year’s contribution CPF is 14,500 (till Dec 2021). Both in my late ’30s and working

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Tan Choong Hwee

29 Oct 2021

Investor/Trader at Home

The following 2 schemes can enjoy tax relief as an employee:

RSTU (Retirement Sum Top Up) to SA: you can RSTU until SA reach FRS ($186k this year), but only get up to $7k tax relief.
VCMA (Voluntary Contribution to Medisave Account): VCMA is subjected to BHS (Basic Healthcare Sum, $63k this year) in MA, and total MC (Mandatory Contribution) plus VC not exceeding annual limit of $37740.

For your case, your MA is already at BHS, so you can only RSTU to your SA for up to $7k tax relief.

For your spouse case, can do both RSTU and VCMA. With this year's contribution of $14500 (make sure it is contributions for JanDec salary, which are credited into CPF accounts in FebJan), there is a headroom of $37740 - $14500 = $23240. This is less than the BHS headroom ($63k - $35k = $28k), so $23240 is the max tax relief your spouse can get from VCMA.

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