Tax Planning 101

The saying goes, there is nothing certain in life but death and taxes. Every year, we get a letter thanking us for our contribution to nation building. While I think paying taxes is an important part to the entire fiscal system, proper tax planning allows us to not pay more taxes than what is legally necessary. In this article, I highlight 3 simple things you can do to reduce your tax obligations while achieving other objectives such as retirement planning. Photo by Luca Bravo on Unsplash CONTRIBUTING TO THE SUPPLEMENTARY RETIREMENT SCHEME (SRS) The Supplementary Retirement Scheme (SRS) was launched in 2001 to encourage individuals to save for their retirement, complementing their existing CPF funds. You can open an SRS account with any of the 3 local banks (i.e. DBS, OCBC or UOB). This allows you to contribute a maximum of $15,300 a year to your SRS account for Singapore Citizens and Permanent Residents. Your tax obligation for the year of assessment will be reduced by the correspond