Tax Reliefs in Singapore: 6 Ways to Reduce Your Personal Income Tax
Key Takeaways:
- Understanding which available reliefs can reduce your tax bill: From supporting your family to planning for retirement, many everyday financial actions may qualify for tax relief if they meet the criteria.
- CPF and SRS contributions offer immediate tax savings: Voluntary top-ups to retirement accounts not only build long-term financial security but also lower your chargeable income.
- Certain life events and responsibilities are recognised through reliefs: Caring for children or elderly dependants, upskilling through approved courses, or making eligible donations can all result in reduced taxes.
- Timeliness matters when planning for reliefs: To benefit from any tax savings, all qualifying contributions and actions must be made before the end of the calendar year.
An Overview of Tax Reliefs Available in Singapore
Paying income tax may not be the most exciting part of working in Singapore, but it is a necessary one. If you earn an income here, chances are you'll need to file and pay personal income tax to the Inland Revenue Authority of Singapore (IRAS). Fortunately, the process is relatively hassle-free, especially for employees whose income details are submitted by their employers.
You can file your taxes through the myTax Portal by declaring your income, deductions, and reliefs. If your employer is part of the Auto-Inclusion Scheme, most of the information will already be filled in—just log in, verify the details, and submit.
The amount of tax you need to pay depends on your chargeable income, which includes employment earnings like salary and bonuses, as well as rental income if you’re a landlord. Non-taxable sources include interest from approved banks and capital gains. For clarity on what’s taxable, refer to IRAS’s official guidelines.
Singapore follows a progressive tax system, where higher income levels are taxed at higher rates. You can check the income tax rate table for 2024 below to get an estimate of what you’ll need to pay.
Resident Tax Income [From YA 2024 Onwards]
Information is accurate at the time of publishing. For the latest updates, please refer to the IRAS website.
Tax reliefs are designed to recognise contributions towards key social goals in Singapore, such as building a family or saving for retirement. These reliefs reduce your chargeable income, which can lower the amount of tax you need to pay. However, there is an annual cap of $80,000 on the total amount of personal income tax reliefs you can claim per Year of Assessment.
Understanding how tax reliefs work can help you optimise your tax position and ensure you’re not taxed on more income than necessary. If you're planning ahead for the next filing period, it’s a good time to explore the reliefs you may be eligible for.
Tax Relief for Married Couples and Families
Raising a family comes with numerous responsibilities, but Singapore offers various tax reliefs to help alleviate the financial burden for parents. These reliefs are designed to support families by reducing your chargeable income, which can lower your overall tax payable.
Below is a summary of available tax reliefs and rebates for married couples and families who are Singapore tax residents:
^ Each relief/rebate has its own qualifying conditions, which must be satisfied for the relief/rebate to be applied.
§ This is a rebate, not a relief.
# Note that the total cap for QCR plus WMCR is $50,000 per child.
Example: How Child Relief Works
Suppose you're a parent with two children under the age of 16. For a given Year of Assessment, you can claim the Qualifying Child Relief at S$4,000 per child, totalling S$8,000.
Let’s say your annual income is S$60,000.
With S$8,000 in child relief, your chargeable income would be reduced to S$52,000.
This directly lowers your taxable income, which means you'll pay less in income tax. Over time, these reliefs can make a meaningful difference in your financial planning, offering both short-term savings and longer-term support as your family grows.
2. Parent Relief
Caring for elderly family members can come with significant financial responsibilities. To recognise this, Singapore’s Parent Relief provides tax support for individuals who have supported their parents, parents-in-law, grandparents, or grandparents-in-law in the previous year.
Example: How Parent Relief Works
Take the example of Ms Lee, a 38-year-old marketing manager with an annual income of S$95,000. She supports her 65-year-old mother, who has no income and lives with her. This makes Ms Lee eligible for the higher tier of Parent Relief.
How to Qualify for Parent Relief
To be eligible for Parent Relief, the dependent must meet the following criteria:
- Be at least 55 years old, or be physically or mentally disabled (in which case, the age and income conditions do not apply);
- Have an annual income not exceeding S$4,000, unless disabled;
- If the dependent lives in a separate household, you must have provided at least S$2,000 in support during the year.
You can claim Parent Relief for up to two dependants, and only one person (either you or your spouse) may claim for each dependent. Relief can also be shared between siblings or other eligible claimants by mutual agreement.
By understanding and utilising Parent Relief, you can mitigate the financial burden of caregiving and reap tax benefits for the support you already provide.
Tax Reliefs for Course Fees
Singapore’s Course Fees Relief encourages individuals to continue learning, whether to advance in their current role or acquire new skills. If you’ve taken upskilling or reskilling courses related to your job, you may be able to reduce your taxable income.
Example: How Course Fees Relief Works
Imagine you enrol in a part-time digital marketing course to sharpen your skills in online advertising. The course is relevant to your marketing job and costs S$3,000.
Because the course meets the qualifying criteria and the fees are within the claimable cap, you can deduct the full S$3,000, reducing your chargeable income.
How to Qualify
To be eligible for Course Fees Relief:
- The course must lead to an approved academic, professional, or vocational qualification, or be directly relevant to your current employment.
- You can also claim for related examination, test, or registration fees.
However, you cannot claim relief for:
- Courses taken for personal interest, hobbies, or general skills (e.g. basic web design for leisure);
- Courses related to holiday jobs or internships, even if they contribute towards graduation.
To confirm if your course qualifies, refer to the latest guidelines on the IRAS website.
By making full use of this relief, you can invest in your career growth while enjoying tax savings at the same time.
4. Tax Reliefs for Donations
Giving back to causes you care about, whether animal welfare, environmental conservation, or community development, can also reduce your tax bill. Donations made to approved Institutions of a Public Character (IPCs) or directly to the Singapore Government for community causes qualify for a 250% tax deduction.
Example: How Donation Tax Deduction Works
Let’s say you donate S$1,000 to an approved IPC, and your annual income is S$36,000.
Your chargeable income is reduced by S$2,500, which reflects the 250% deduction on your S$1,000 donation.
What Types of Donations Qualify?
Beyond cash, other forms of donations may also be eligible for tax deductions:
How to Claim Donation Tax Deductions
You do not need to declare qualifying donations on your tax return. Approved IPCs will automatically submit the necessary information (including your name, donation amount, and date) to IRAS. Your tax deduction will then be reflected in your tax assessment.
Note that IRAS no longer accepts tax deduction claims based on physical donation receipts. All claims must be processed through the IPCs’ electronic submissions.
By supporting a cause you believe in, you’re not just making a difference—you’re also receiving a tangible benefit in the form of reduced taxes.
5. Life Insurance Relief
Having a life insurance policy not only protects your future; it may also lower your tax bill. If you meet the conditions, you could qualify for Life Insurance Relief, which reduces your chargeable income based on your CPF contributions and insurance premiums paid.
How Much Can You Claim?
You can claim the lower of the following:
- S$5,000 minus your CPF contribution, or
- Up to 7% of the insured value, or the amount of insurance premiums paid, whichever is lower.
Example: How Life Insurance Relief Works
Let’s say you’re a 30-year-old professional earning S$40,000 a year. You pay S$2,000 annually for a life insurance policy, and your CPF contributions for the year total S$4,800.
In this case, you can claim a S$200 relief—the lower of your premium paid (S$2,000) or the calculated relief limit (S$200). Your chargeable income is reduced to S$39,800, resulting in a slight reduction in income tax.
How to Qualify
You must meet the following criteria:
- Your employee CPF contributions (or Medisave/voluntary CPF contributions if self-employed) must be less than S$5,000 for the year
- The life insurance policy must be under your own name or your spouse’s
- Premiums must be paid for yourself or your spouse, not for your parents or children
- Premiums for ElderShield, CareShield Life, or Integrated Shield Plans do not qualify for this relief.
You can refer to the IRAS Life Insurance Relief page for full details and updated guidelines.
If you’re considering taking up a life insurance policy that may qualify for relief, Income Insurance’s Complete Life Secure which includes the option to choose a Multiplier Cover1,2 of up to 500% of the sum assured till the age of 65, 75 or 80, covering death, terminal illness and total and permanent disability.
If you're not sure which life insurance plan suits your needs, connect with our advisors for personalised advice.
6. Tax Reliefs for Retirement Savings
If you’re planning for retirement, there’s another reason to start now: tax relief. By topping up your CPF or Supplementary Retirement Scheme (SRS) account, you can reduce your chargeable income and enjoy immediate tax savings.
Here are some of the key tax reliefs available for retirement-related contributions:
CPF Cash Top-Up Relief
You can qualify for CPF Cash Top-Up Relief if you're a Singapore Citizen or Permanent Resident who makes voluntary cash top-ups to your own Special Account (SA) or Retirement Account (RA) under the CPF Retirement Sum Topping-Up Scheme.
You may also claim up to S$8,000 in relief for topping up the SA or RA of family members such as your parents, grandparents, in-laws, or grandparents-in-law. If your spouse or sibling had an annual income of S$4,000 or less in the previous year, top-ups to their account may also qualify.
Take note of the following:
- The total CPF Cash Top-Up Relief is capped at S$14,000—comprising S$8,000 for yourself and up to S$8,000 for eligible family members.
- Relief is automatically granted based on CPF Board records. No manual claim is needed.
SRS Tax Relief
Every dollar you contribute to your SRS account reduces your taxable income by the same amount, up to the contribution cap for your residency status.
Example: How SRS Tax Relief Works
Mr Tan, age 45, earns S$80,000 annually. In 2024, he contributed S$12,000 to his SRS account.
By making this contribution, Mr Tan lowers his taxable income by S$12,000, leading to immediate tax savings while setting aside funds for retirement.
It’s essential to keep in mind that you cannot claim SRS tax relief if your account is suspended as of 31 December of the contribution year, or if you withdraw the contributed amount within the same year.
Growing Your SRS Savings
To get more out of your SRS savings, consider an insurance savings plan to help your funds grow. One option is Income Insurance’s Gro Retire Flex Pro II, which offers:
- Monthly cash payouts3 consisting of a monthly cash benefit4 during your payout period and a non-guaranteed cash bonus on top of each monthly cash benefit.
- Flexibility to choose when you want to start receiving your monthly cash payouts3.
How to Claim
You do not need to submit a separate claim for CPF Cash Top-Up Relief or SRS Tax Relief. Both will be automatically included in your tax assessment based on the information submitted to IRAS by CPF and SRS providers.
By combining tax planning with retirement savings, you can take care of your future while enjoying tax savings today.
It Pays to Know Your Tax Reliefs
Paying taxes helps support the services and infrastructure that make Singapore a great place to live. However, there are also other meaningful ways to contribute and enjoy tax savings at the same time.
Whether you’re topping up your CPF, contributing to an SRS account, donating to an approved IPC, or taking up a life insurance plan, these actions can help reduce your taxable income. Just be sure to complete them before the end of the year to qualify for relief in the next tax season.
If you’re exploring life insurance options that may offer protection and potential tax benefits, contact an Income advisor to find a plan that suits your needs.
1 Multiplier cover means a percentage of the sum assured shown in the policy schedule. The Multiplier Cover is applicable before the anniversary immediately after the insured reaches the age of 65, 75 or 80 (whichever is applicable).
2 Complete Life Secure includes a non-participating regular premium compulsory rider, Complete Life Secure – Protection Benefit. It pays the Retrenchment Benefit and part of the Multiplier Cover. Please refer to the policy conditions for further details.
3 The cash payout consists of a monthly cash benefit and a non-guaranteed cash bonus.
4 If the policy has not already ended, when the accumulation period ends, we will check the cash value of this policy. If the cash value is less than $10,000 after taking into account the policy loan and interest, we will pay you the policy’s cash value and the policy will end. If the cash value is at least $10,000 after taking into account the policy loan and interest, the payout period will begin and we will pay you a monthly cash benefit for the next 10, 20 years or till age 100, depending on the payout period you have chosen, or until the policy ends. The monthly cash benefit is the ‘cash benefit’ amount shown in the policy schedule. If you change your regular premium amount or payout period, we will work out a new monthly cash benefit. We will pay the first monthly cash benefit on the policy anniversary immediately after the end of the accumulation period. You cannot change the payout period once we have paid the first monthly cash benefit. If this policy has not already ended, it will end when we pay the last cash benefit.
This article is meant purely for informational purposes and does not constitute an offer, recommendation, solicitation or advise to buy or sell any product(s). It should not be relied upon as financial advice. The precise terms, conditions and exclusions of any Income Insurance products mentioned are specified in their respective policy contracts. Please seek independent financial advice before making any decision.
These policies are protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact Income Insurance or visit the GIA/LIA or SDIC websites (www.gia.org.sg or www.lia.org.sg or www.sdic.org.sg).
This advertisement has not been reviewed by the Monetary Authority of Singapore.
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