Should I top up CPF SA or MA for tax relief? - Seedly
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Anonymous

Asked 3w ago

Should I top up CPF SA or MA for tax relief?

I am a full-time employee aged 30, and my employment income before any relief is about 63k. As it is a few days before end of this year, I am thinking of topping up a few k to my SA or MA. Is this feasible? Any advice?

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    Ryan

    Level 5. Genius

    Answered 3w ago

    You can top up to reduce taxes.

    However, do note that the cut off time for contribution is tomorrow 7 pm.

    So if you want to contribute, your money need to reach their system before the cut off time and different contribution methods take different amount of time.

    Fastest maybe is to use FAST but do not setup the transfer just before 7 pm since it depends on the system to reflect. If you miss it, your contribution is for next year.

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    Hi anon,

    There really isn't much time to top up so if you are going to do it, do it fast.

    However, given your employment income of $63K, you're looking at around $49K of taxable income after CPF and earned income relief at a minimum. This attracts a 7% tax rate on $9K and around $1.2K in total tax.

    Topping up will probably give you a savings of around 7% (which might not be a lot), however, do note that monies topped up into SA will be reserved for CPF RA and cannot be withdrawn.

    In my view, if you have sufficient liquidity, you may top up to save some tax.

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