Introduction to Property Related Taxes in Singapore

 

 

There are few property taxes in Singapore you need to take note when you invest in Singapore property. These depend on which property type and the number of properties you own in Singapore. These taxes related to dealing and holding of property in Singapore you need to pay upon purchasing Singapore property are stamp duty tax, goods and services tax (GST), seller stamp duty tax, annual property tax, and rental income tax.

 

1.      Property Tax

 

Property tax rates on owner-occupied and non-owner occupied residential properties are applied on a progressive scale. All other properties continue to be taxed at 10% of the Annual Value. Examples of how to calculate property tax are also provided.

 

(1)     Owner-Occupier Tax Rates (Residential Properties)

 

Owner-occupied residential properties may be condominiums, HDB flats or other residential properties where the owner lives in ("occupies") the property. Owner-occupied residential properties enjoy owner-occupier tax rates.

 

Annual Value (SGD)

Effective 1 Jan 2015

Property Tax Payable (SGD)

First 8,000

Next 47,000

0%

4%

0

1,880

First 55,000

Next 15,000

-

6%

1,880

900

First 70,000

Next 15,000

-

8%

2,780

1,200

First 85,000

Next 15,000

-

10%

3,980

1,500

First 100,000

Next 15,000

-

12%

5,480

1,800

First 115,000

Next 15,000

-

14%

7,280

2,100

First 130,000

Above 130,000

-

16%

9,380

 

 

(2)     Residential Tax Rates (Non-Owner Occupied Residential Properties)

 

Non-owner occupied residential properties may be condominiums, HDB flats or other residential properties. The owner does not live in ("occupy") the property and, therefore, owner-occupier tax rates do not apply.

 

The following tax rates apply to non-owner occupied properties except for those in the exclusion list.

 

Annual Value (SGD)

Effective 1 Jan 2015

Property Tax Payable (SGD)

First 30,000

Next 15,000

10%

12%

3,000

1,880

First 45,000

Next 15,000

-

14%

4,800

2,100

First 60,000

Next 15,000

-

16%

6,900

2,400

First 75,000

Next 15,000

-

18%

9,300

2,700

First 90,000

Above 90,000

-

20%

12,000

 

 

(3)     Commercial and Industrial Properties(Non-Residential)

 

Non-residential properties such as commercial and industrial buildings and land are taxed at 10% of the Annual Value.  The owner-occupier tax rates do not apply to non-residential properties even if you have bought the properties for your own use / occupation.

 

Note:

1.      The Annual Value of buildings is the estimated gross annual rent of the property if it were to be rented out, excluding furniture, furnishings and maintenance fees. It is determined based on estimated market rentals of similar or comparable properties and not on the actual rental income received.

 

2.      Annual property tax is calculated by multiplying the Annual Value (AV) of the property with the Property Tax Rates that apply to you.

 

For example, if the AV of your property is $30,000 and your tax rate is 10%, you would pay $30,000 x 10% = $3,000.

 

 

2.      Stamp Duty Tax

 

The first property tax in Singapore you should aware of is Stamp duty tax. This applies when you purchase residential and commercial property in Singapore.

 

Commercial property stamp duty tax

 

Value

Tax Rate

First SGD180,000

1%

The next SGD180,000

2%

Above SGD360,000

3%

 

In short, if you purchase commercial property above SGD 360,000, the amount of stamp duty you need to pay is 3% of property price minus SGD 5,400.

 

Residential property stamp duty tax

 

The normal stamp duty tax for residential property is the same as commercial property stamp duty tax.

 

Value

Tax Rate

First SGD180,000

1%

The next SGD180,000

2%

Above SGD360,000

3%

 

Additional Buyer Stamp Duty (ABSD)

 

Since 12 Jan 2013, individual or corporate entity who intend to purchase residential property in Singapore need to pay additional buyer stamp duty. This policy is implemented by Singapore government to cool off the Singapore residential property price, to protect genuine investor, and to prevent bubble formed in the market.

 

Singapore citizen needs to pay additional buyer stamp duty if they acquire second property and above. Singaporean PR and foreigner needs to pay additional buyer stamp duty if they acquire first property and above.

 

Additional Buyer Stamp Duty (ABSD)

Singapore Citizen

Singapore PR

Foreigner and Corporate Entity

First property

0%

5%

15%

Second property

7%

10%

15%

Third property

10%

10%

15%

 

Additional Buyer Stamp Duty does not apply to Singapore commercial property segment.

 

3.      Goods and Services Tax (GST)

 

The second property tax in Singapore is Goods and services tax (GST). It applies when you purchase commercial property if the seller is a GST registered. The current goods and services tax in Singapore is 7%.

 

4.      Seller Stamp Duty Tax

 

Seller stamp duty tax applies to residential and industrial property. It is a new property tax in Singapore implemented to discourage speculator to sell the property within short period of time for quick profit. If you sell your residential property within 4 years from your purchase date, you will need to pay seller stamp duty upon disposing.

 

Residential seller stamp duty

Tax Rate

Sell within 1st year

15% of selling price or valuation whichever higher

Sell within 2nd year

10% of selling price or valuation whichever higher

Sell within 3rd year

5% of selling price or valuation whichever higher

Sell after 3rd year

0%

 

5.      Tax on rent income

 

In addition to the tax on property ownership, tax is payable on rental income of a property. The owner of the property receiving the income is responsible for declaring and paying this tax, regardless of whether they are resident in the property. Tax on rent income is not a named tax in itself; rental income falls under the calculation of income tax. The total rent received from the tenant must be declared. Total rent includes charges on the property, the furniture and fittings and service charges.

 

Expenses can be claimed against rental income on the property. Expenses incurred outside the period of tenancy cannot usually be claimed. However, if an owner can show that they intend to let out the property, these expenses may be considered.

 

If a property is jointly owned, each owner pays according to her/his share of the ownership.

 

 

 

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