Have you max out your tax relief (income earned in 2018) for tax payable in 2019? Turtle "loh soh" reminder.

You have less than 2 months till end of Dec to do so to top up your CPF accounts or your love ones to maximize your tax relief for total income earned in 2018.

If you treat CPF as your risk free component of your retirement savings and still earning a decent income, this is a good way to save for your future retirement and also to reduce the tax payable to IRAS.

Do you want to find out what Turtle did in every January for the past 3 years?

Refer to my post back in Jan 2018 - https://www.investingnote.com/posts/482922

What I will do in Jan 2019?

1) I will be receiving my annual bonus in Nov/Dec 2018 and will be saving up 7k to top up my CPF SA account in Jan 2019. Also known as the Retirement Sum Topping-Up (RSTU) Scheme.

2) If I have got excess cash bonus like last year, I will be topping up my mum's RA 7k as well.

3) I will top up cash to my MA account to hit the 2019 Basic Healthcare Sum (BHS) ceiling. CPF will announce in Jan what is the ceiling, I believed it should be between 4-5% like last couple of years. So we should be looking at around $57,000 (based on 4.5% increase).

All 3 actions will have tax relief and reduce my tax payable for income earned in 2019.

More info can be found here: https://www.straitstimes.com/forum/letters...

NOTE: CPF Cash Top-ups Scheme are irreversible and irrevocable.

FYI, CPF did not pay Turtle to advertise for them. I did it because I am KPO Turtle and like to share "ho liao" with my IN bro and sis.

Have a great weekend. Sit back, Relax and Eat Popcorns.

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164 comments
christophertan0

Should I use my CPF OA savings to invest in some blue chips should STI continue to drop to 2800 or 2500 levels? Banks look interesting under 20.

Sporeshare

Reply to @christophertan0 : You may check it out with @layers.i think he uses it to buy on property counter,high yield dividend and REITs

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theintelligentinvestor

CPF after deducting 600k for housing loan and 100+k for investment. Maxed out my SA early in my career, and also invested sensibly.

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Turtle_Investor

Reply to @theintelligentinvestor : This post not applicable to you liao.

U been there done that.

U r our CPF veteran

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yewkhimkang

If I had already met the min sum, if I TOP up to SA, the amount will be refunded? And no tax relief as well?

XInvestor

Reply to @yewkhimkang : SRS the only option... i also max out my SA...

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Noctis

@Turtle_Investor : sorry noob here does this mean minimum i need a 20K in OA and 40k in SA to achieve the 1%more , or it can be 40k OA and 20k SA.

Turtle_Investor

Reply to @Noctis : https://www.cpf.gov.sg/members/aboutus/abo...

Central Provident Fund (CPF) members currently earn interest rates of up to 3.5% per annum on their Ordinary Account (OA) monies, and up to 5% per annum on their Special and MediSave Account (SMA) monies. Retirement Account (RA) monies currently earn up to 5% per annum.

These interest rates include an extra 1% interest paid on the first $60,000 of a member’s combined balances (with up to $20,000 from the OA).

If you don't have 20k in OA, then SA 60k will earn the extra 1%. So up to 20k in OA will earn the extra 1% if there is a balance.

Turtle_Investor

I always told my wife that I have two days that I am extremely happy financially.

1) Salary crediting day
2) CPF crediting day (15th of the month)

Meaning today, when I login the CPF app, I will be quite happy to see the balance growing.

Turtle_Investor

Reply to @Dividend_Warrior : Oh ya .. you are absolutely correct. That's another happy day

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livelifefreely

Assuming OA, MA and SA all meet the Minimum Sum, can one still top up with cash to either one of these accounts and enjoy tax relief?

Turtle_Investor

Reply to @livelifefreely : That's a good problem. Cannot be happier once we reach that state of preparation for retirement.

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Dividend_Warrior

Have been topping up my SA since last year. This thread has convinced me to switch to maxing out MA.
Thanks @Turtle_Investor :)

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Dividend_Warrior

Reply to @Hachiko : Considering to become property warrior soon. Hahaha!

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GrowthInvestor

Why u prefer to invest in cpf savings than stocks?

Given a choice i rather take out all Cpf savings than to put money in it

I contrib to SRS instead as can use it to buy stocks. No limit

Other reliefs u can exploit:
- parent relief
- pay parents allowance by topping up their cpf

GrowthInvestor

Reply to @RotiBlata : to me the contribution from salary is sufficient. Your mileage may vary.

you top up 7k, then Depending on the RA payout amount .. over a year the payout amount may accumulate to 7k.
If not enough, then supplement with cash.

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RotiBlata

If maxed out CPF MA, the interest for MA and all contribution goes to SA ? And if SA is maxed too, everything goes to CPF OA ?

In this case, every year the cap for MA increases. Does the interest gained from MA stays in MA after the next year's cap is increased ?

Turtle_Investor

Reply to @dr3amgawd : Nvm la I always think it's a privilege to serve ... cannot be measured by monetary incentive.

My country My soil, if not turtle then who? Thanks for sharing

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Turtle_Investor

My humble Cpf balance after paying off our 260k BTO with Mrs turtle.

If u have limited funds, I suggest focus on voluntarily contributing to MA (subjected to annual cpf LIMITS) followed by SA. Pick the easiest fruits first.

Interest earned 4% can be used to offset your annual insurance HnS premiums. Ie foc coverage by GOVT

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Sporeshare

Reply to @GrowthInvestor : can consider to top up SA. Any amount is fine .work for many years ..

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