Does the use of SRS funds for investment constitute a withdrawal from the account?
No. The use of SRS funds for investment does not constitute a withdrawal from the account.
Can I use the SRS funds to exercise the stock options issued by my company?
The Government does not restrict the exercise of stock options within SRS, provided that the following conditions are met: i) The monies used to exercise the stock options must come from the SRS account; ii) The shares from the exercise of the stock options must be retained within the SRS account, and; iii) The proceeds from the sale of the shares (from the exercise of the stock options) must be returned to the SRS account. The conditions listed above are also applicable for most other investments. We advise that you approach your SRS operator for more information.Will Yearly SRS contribution for 2024 will be increase ?
From 1 January 2016, the annual SRS contribution cap is $15,300 for Singapore Citizens and Permanent Residents; and $35,700 for foreigners.
There is no changes to the SRS contribution cap from 2024.
Are dividends received from unit trusts purchased with SRS funds taxable?
One-tier exempt dividends and distributions from unit trusts purchased with SRS funds and deposited into the SRS account are not taxed when they are credited into the SRS account. However, tax will be imposed on the amount subsequently withdrawn from the SRS account.
Are ETFs (Exchange Traded Funds) which are traded in Singapore Stock Exchange eligible SRS investments?
The Government does not have any restriction on the use of SRS money for the purchase of Exchange Traded Funds (ETFs) listed on the Singapore Stock Exchange. You may wish to make some enquiries with your SRS operator on the possibility of using your SRS funds to purchase ETFs.
How long will it take before I can utilize my money in the SRS account for investment after I have contributed it to my SRS account?
You should generally be able to utilise your SRS monies for investment once your SRS operator has confirmed the receipt of the monies (for example after it has cleared your cheque) and credited the monies to your SRS account.
You may wish to check with your SRS operator on the actual time lag between making a contribution and being able to make an SRS investment.
Is there a guaranteed rate of return on the investments I make with my SRS funds?
No. There is no guaranteed rate of return on the investments.Can a customer purchase a single premium endowment policy that matures at age 65 under SRS? What happens to the cash proceeds upon maturity?
An SRS account holder may purchase a single premium endowment policy that matures when he/she reaches the age of 65. The cash proceeds upon the maturity of any investment (including a single premium endowment policy) would generally have to be returned to the SRS account.Can I do a direct purchase of equities on the Singapore Stock Exchange or any other exchange in the world?
The Government does not prohibit a person from purchasing shares listed in Singapore or any other countries. The range of investment products on offer generally depends on product providers; we suggest you consult the financial institution which you are interested in purchasing products from if you wish to purchase a share listed on a foreign exchange. Currently, overseas investments may not be available to members.
Can I surrender my annuity policy after my SRS account is deemed closed?
An SRS member is not allowed to surrender the policy after the SRS account has been closed or deemed closed.Is there any interest paid on the balance in the SRS account, and if yes, what is the interest rate?
The interest rate on funds in SRS accounts are set by the market. Each SRS operator decides on the interest, if any that it pays on funds in the SRS account. You may wish to approach the SRS operators for further information as they would be better placed to advise you.
Must all proceeds from the sale of my SRS investment instruments be returned to my SRS account?
Yes. All proceeds from the sale of SRS investment instruments must be returned to the SRS account.
Must the investment mature when one reaches the prescribed retirement age?
The investment need not mature at the prescribed retirement age. An investor may purchase a single-premium endowment plan maturing at age 62, another maturing at age 63, etc.
If the investment is a life annuity, you will be taxed on 50% of the total annuity payouts each year, for as long as the annuity payouts are received. If the investment is not a life annuity and matures beyond the ten-year withdrawal period, it will be valued and taxed at 50% tax concession at the end of the ten-year period.What happens if the SRS operator or the financial institution where I make my SRS investments goes bankrupt?
Savings and investment products, including SRS, placed with financial institutions are not guaranteed against losses in the event of the financial institution's bankruptcy. When placing their monies with any financial institution, investors should assess and monitor for themselves the financial soundness of that institution.What investment instruments can I purchase using my SRS funds?
You may invest in a wide range of financial assets, including those offered by financial institutions (product providers) other than your SRS operator. Please approach your product providers for information on the products they are offering for SRS as the decision on whether to offer a product to SRS monies generally lies with them [1].
However, direct property investments are not allowed. As for life insurance products, the following conditions shall apply:Only single premium products are allowed (including recurrent single premium products, encompassing both annuity and non-annuity plans).
Life cover (including total and permanent disability benefits) will be capped at 3 times the single premium.
Plans can allow for a contribution continuation feature/benefit upon disability.
Other types of life insurance e.g. critical illness, health and long-term care are excluded.
Trust nomination is not allowed for life insurance products purchased using SRS funds.
You should note that investment choices are made on a caveat emptor basis.
[1] Currently, overseas investments may not be available to members.