facebookIs the income tax relief for personal relief only apply to medisave account ($7k)? - Seedly

Advertisement

Anonymous

25 Dec 2020

Saving Hacks

Is the income tax relief for personal relief only apply to medisave account ($7k)?

Was about to top up my cpf when I saw this.
Thanks.

Discussion (2)

What are your thoughts?

Learn how to style your text

Elijah Lee

25 Dec 2020

Senior Financial Services Manager at Phillip Securities (Jurong East)

Hi anon,

The $7K tax relief is referring to RSTU and that is a separate thing from your routine CPF contributions as an employee.

Tax relief is also accorded to your voluntary medisave contributions as well.

From the IRAS website:

Amount of Tax Relief VC-MA

The amount of tax relief given to the lowest of the following:

  1. Voluntary cash contribution directed specifically to Medisave Account or

  2. Annual CPF contribution cap for the year, less Mandatory Contribution (MC)* or

  3. Prevailing Basic Healthcare Sum(BHS)^, less the balance in Medisave Account before the voluntary cash contribution.

The BHS is $60K this year and will be raised to $63K next year. The annual CPF contribution cap is $37740.

No. SA is if your account has less than FRS.

For MA, your account is less than BHS and you have not exceeded the yearly allowed CPF contribution from your job and volunteer contribution of 37740 but not including the volunteer SA contribution.

Write your thoughts

Advertisement