Is There an Equivalent to a 401k in Singapore? A Guide for US Expats

For US expats residing and working in Singapore, identifying a similar retirement plan is crucial, especially since you are unable to continue contributing to your 401k plans from abroad.

In this article, we will explore a potential equivalent to 401k in Singapore, focusing on its contribution and withdrawal rules, and tax implications for US expats in Singapore.

Which Pension Plans Exist in Singapore?

Singapore’s pension system rests on two main pillars:

1. Central Provident Fund (CPF)
2. Supplementary Retirement Scheme (SRS)

Central Provident Fund (CPF)

Unlike 401(k) in the US—a voluntary, employer-sponsored retirement savings plan—the Central Provident Fund (CPF) is Singapore’s mandatory retirement savings scheme. It’s designed to provide retirement, healthcare, and housing support and is available only to Singaporean citizens and permanent residents.

CPF works by mandating both employees and employers to contribute a fixed percentage of the employee’s salary into three CPF accounts:

• Ordinary account (OA): For housing, investment, and retirement
• Special account (SA): For long-term retirement savings
• MediSave account (MA): For healthcare expenses

Contributions and withdrawals from a CPF are tax-advantaged within Singapore, but funds are largely inaccessible until the retirement age of 55.

Since CPF is a mandatory social security system rather than a voluntary pension scheme, it is not an option for US expats unless they obtain permanent residency.

Supplementary Retirement Scheme (SRS)

The Supplementary Retirement Scheme (SRS) is a government-endorsed, voluntary pension scheme introduced in 2001 to help individuals save additional funds for retirement. It is available to Singaporean citizens, permanent residents, and foreigners—including US expats—who earn income in Singapore.

The scheme operates on a voluntary contribution basis, allowing you to allocate a portion of your income into an SRS account. In return, SRS enables you to defer taxation on a part of your income by claiming tax relief equal to the amount of your contributions. Upon retirement, withdrawals are typically subject to tax advantages.

Is SRS Equivalent to a 401(k) in Singapore?

While SRS includes tax-deferred contributions and investment growth, it is not a direct equivalent to 401(k).

401(k) is a retirement plan offered by US employers to their employees. It can be funded by either pre-tax (traditional 401(k)) or after-tax (Roth 401(k)) contributions and may entail specific benefits like employer matching and loans. Penalty-free withdrawals are typically available after the age of 59½.

In contrast, SRS is a voluntary program independent of your employment status. Contributions are effectively made on a pre-tax basis as they allow you to reduce your taxable income and defer taxes until you begin withdrawing funds from your SRS account. Unlike 401(k), SRS does not include employer matching or loans, while withdrawals can be made penalty-free after the age of 63.

While both SRS and 401(k) offer tax deferral benefits, their withdrawals are subject to specific taxation rules. With SRS, only 50% of withdrawals are taxable at or after retirement age, while traditional 401(k) withdrawals are fully taxable.

Although they share similarities, SRS is not recognised by the IRS as a qualified retirement plan, meaning US expats can’t directly roll over a 401(k) plan to an SRS account.

How Do SRS Contributions Work?

You can contribute—in cash—to your SRS account up to the annual limit at any time during the year through either:

1. Lump sum payments
2. Period instalments

There is no minimum contribution requirement. However, if you have started withdrawing from your SRS account after reaching the prescribed retirement age (or under certain conditions), you can no longer make new contributions.

SRS contributions made by 31 December are eligible for SRS tax relief in the following Year of Assessment. For instance, to claim relief in 2026 (which assesses income for calendar year 2025), you must deposit your SRS contributions by 31 December 2025.

How Much Can You Contribute to SRS Annually?

Singapore imposes an annual cap on SRS contributions, with the maximum amount depending on your residency status:

The discrepancy in contribution limits reflects the fact that foreigners, such as US expats, are not eligible for tax relief from CPF contributions, unlike citizens and permanent residents. Contributing to the annual maximum limit can significantly reduce your taxable income as an expat in Singapore.

SRS operators require you to prove your non-resident (foreigner) status annually, typically by submitting the Declaration Form for SRS (For Foreigners), to qualify for the higher foreigner contribution cap. Should you obtain Singapore permanent residency or citizenship during the year, you are obligated to update your SRS operator so that the applicable SRS annual cap can be recalculated on a pro-rata basis.

Can Employers Contribute to SRS?

While contribution matching is not available as it is with 401(k), Singapore employers may contribute to your SRS account on your behalf. For instance, they may include SRS contributions as part of an outstanding agreement, a bonus, or a benefits package.

Employer contributions to your SRS are considered a part of your employment income. As such, they are subject to income tax, which you may offset by claiming tax relief. In addition, employer contributions are counted towards your annual SRS contribution cap.

What Are the SRS Withdrawal Rules?

SRS is designed as a long-term retirement savings vehicle, and withdrawals are subject to strict rules to encourage tax-deferred growth.

Although you may withdraw funds from your SRS at any time, doing so before reaching the statutory retirement age (currently 63) or meeting specific eligibility requirements will result in the following:

1. The total withdrawal amount will be subject to tax at your prevailing income tax rate.
2. A 5% early withdrawal penalty will be imposed on the total withdrawn amount.

If you begin withdrawals after reaching the statutory retirement age, only 50% of the withdrawn amount will be subject to income tax. The withdrawal period lasts 10 years from the date of your first penalty-free distribution, after which you will be required to withdraw any remaining balance in full (except life annuities).

How Can You Avoid Early Withdrawal Penalty as an Expat?

Foreigners, including US expats, who have maintained their SRS account for at least 10 years may make a one-time, full withdrawal without incurring the 5% penalty, even if they have not reached retirement age.

To qualify for this penalty-free distribution, you must satisfy the following requirements:

1. You have remained a foreigner (not obtained permanent residency or citizenship) for a continuous 10-year period up to the date of withdrawal.
2. Your SRS account has been open for at least 10 years.
3. You withdraw the entire balance of your SRS account.

Such a withdrawal will be eligible for a 50% tax concession on the withdrawn amount.

How Does Residency Affect the Taxation of SRS Withdrawals?

If you retain or attain Singapore tax residency in retirement, the taxable portion of your SRS withdrawals (50% or 100%) will be subject to Singapore’s progressive income tax rates. However, if you remain or become a non-resident for tax purposes while withdrawing from your SRS, you will be liable for a 15% income tax rate or the progressive rate for residents, whichever is higher.

Singapore imposes a withholding tax on all withdrawals made by foreigners and permanent residents. The rate is currently at 24% of the taxable portion of the withdrawal.

The withholding tax is not the final tax payable on your withdrawals—it is a credit against your actual tax liability. If you don’t use it to offset your taxes, you may reclaim the withheld tax by applying for a refund in the year following the one in which taxation occurred.

Are SRS Withdrawals Taxed in the US?

The IRS does not consider foreign pension payments as foreign-earned income eligible for exclusion under the Foreign Earned Income Exclusion (FEIE) rules. Consequently, your SRS withdrawals are fully subject to US income tax.

Since there is no double tax treaty between Singapore and the US, your SRS withdrawals may be subject to tax in both jurisdictions. However, as a US expat, you may claim a foreign tax credit (FTC) to offset the Singapore tax paid on your SRS withdrawals and mitigate the effect of double taxation.

How To Open an SRS Account?

Opening an SRS account as a US expat involves the following steps:

1. Select an SRS operator: SRS accounts are managed by three banks in Singapore. When choosing where to open your SRS account, you may opt for the bank where you already hold other types of accounts or the one offering the most suitable investment options.
2. Ensure eligibility: Confirm that you meet the eligibility criteria for opening an account.
3. Prepare documentation: Gather your identification documents, such as your passport, and complete the Declaration Form for SRS (For Foreigners).
4. Open the account: You can set up your SRS account either in person at a bank branch or online through internet banking. The account is typically opened immediately or within a few business days.
5. Begin contributing: Once the account is open, you can start making contributions by transferring funds from your regular bank account.
6. Invest your funds: After making contributions, you may choose to invest your funds in a range of SRS-approved investment options, such as exchange-traded funds (ETFs), individual stocks, and corporate and government bonds.