The tax rate on the next dollar of income you earn. Singapore's resident rates are progressive: 0% / 2% / 3.5% / 7% / 11.5% / 15% … up to 24% on income above S$1m.
Your marginal tax rate is the tax rate that would apply to the next dollar of income you earn. It's the rate at the top end of your chargeable income, not the average rate you pay.
Marginal rate is the number to use when evaluating whether a tax-saving move (like an SRS contribution or RSTU top-up) is worth it.
First S$20,000: 0%
Next S$10,000: 2%
Next S$10,000: 3.5%
Next S$40,000: 7%
Next S$40,000: 11.5%
Next S$40,000: 15%
Next S$40,000: 18%
Next S$40,000: 19%
Next S$40,000: 19.5%
Next S$40,000: 20%
Next S$180,000: 22%
Next S$500,000: 23%
Above S$1,000,000: 24%
Chargeable income S$120,000. The first S$80,000 of chargeable income is taxed at progressive bands up to 7%. The next S$40,000 sits in the 11.5% band.
Marginal tax rate: 11.5%. Effective tax rate: about 6.6%.
Conclusion: an additional S$1,000 of taxable income costs S$115. A S$1,000 SRS contribution saves S$115. That's your decision math for any tax-deferral move.
Time bonuses: if a bonus would push you into a higher band, consider whether RSTU or SRS contributions can deflate the chargeable amount back down.
Spouse income splitting: if one spouse is at a high marginal rate and the other isn't, having investments and rental property under the lower-earning spouse's name reduces household tax.
Retirement: withdrawals from SRS after age 62 are taxed on 50% of the amount. If your marginal rate then is 7% versus the 18% you saved during contribution, that's an 11-percentage-point arbitrage.
Non-residents pay flat 15% on employment income or resident rates (whichever is higher) — useful to know if you spend variable time outside Singapore.
The tax rate on your next dollar of income — i.e. the top band your chargeable income reaches. At chargeable income S$80,000, marginal rate is 11.5%. At S$120,000, it's 15%. At S$200,000, it's 19.5%. Use this rate to evaluate whether tax-saving moves (SRS, RSTU) are worthwhile.
Marginal rate is the top band on your last dollar; effective rate is total tax divided by chargeable income. At S$80,000, marginal is 11.5%, effective is about 4%. Marginal is the relevant rate for decisions about extra income or contributions; effective tells you your actual overall tax burden.
0% on first S$20k; 2%, 3.5%, 7%, 11.5%, 15%, 18%, 19%, 19.5%, 20% across the next bands; 22% above S$320k; 23% above S$500k; 24% above S$1m. Non-residents face a flat 15% on employment income or resident rates, whichever is higher.
By pushing chargeable income into a lower band via reliefs — SRS contributions, RSTU top-ups, donations, and any other deductions. A high-earner at 22% marginal who contributes S$15,300 to SRS saves S$3,366 in tax that year while also building their retirement pot.