Do you know Singapore’s Property Taxes?

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Are you buying a new property but there are too many factors that are affecting your property buying decisions?

Many property agents have been talking about the depreciating value of a HDB as it gets older, so it’s not a good idea to buy a resale HDB, right? However, a private condominium will put a strain on your monthly finances, which means you and your spouse will have to tighten your daily expenses, visit cafes on alternate Sundays instead of getting your weekly Sunday brunch at your favorite cozy cafe at Tiong Bahru, and your wife will have to sacrifice the latest 2020 edition Prada handbag she has been eyeing. Just the thought of having an unhappy wife stomping around is enough to replay T-REX breakout attack scene from Jurassic Park 1993 vividly in your mind. Landed homes are not exactly what both of you are looking for because there are firstly no amenities, and secondly, your wife loves the thought of suntanning by the pool while you swim your laps. This leaves you with the Executive Condominium option. You are however aware that ECs are good investment assets but not as good as those of the private condos despite the various CPF grants available.

With so many objections in your mind in respect to all the different residential properties in Singapore’s property market, how then can you ensure that you will not be plunging into the wrong choice of homeownership?

First and foremost, always remember to do this: Proper and detailed financial planning!

Financial plannings are basically the key to your next many steps in your property search journey. Be it buying as an investment or for your own stay, when you planned your finances properly, the likelihood of buying over your means is reduced significantly. If you are good with your numbers and are aware of different Singapore’s property taxes and stamp duties, by all means go ahead and plan your finances clearly on the Excel sheet with your private banker. However, if you are unsure of the different home loan calculations and property taxes, it will be safer to speak to an agent who can work out a detailed financial plan with you, together with a banker, before moving forward.

For this post, I will be introducing the 3 critical types of Property Stamp Duties in Singapore.

Buyer’s Stamp Duty

When you purchase or acquire a property, the first stamp duty you have to pay is the Buyer’s Stamp Duty. From 20th Feb 2018, all residential properties above $1million will have an additional 4% Buyer Stamp Duty tax.

Here is how BSD rates are calculated based on the value of a property,

Purchase Price or Market Value of the PropertyBuyer’s Stamp Duty Rate
First $180,0001%
Next $180,0002%
Next $640,0003%
Remaining Amount4%

To make it less complicated,

– If the property you are purchasing is less than $1 million, your formula will be

[(3% x purchase price) – $5,400].

– If the purchase price is more than $1 million, your formula will be

[(4% x purchase price) – $15,400]

Additional Buyer’s Stamp Duty (ABSD)

The Additional Buyer’s Stamp Duty was first introduced on 8 December 2011, whereby the amount is based on the property’s purchase price or market value, similar to BSD. ABSD is applicable to Singapore Citizens buying their second and subsequent properties, Permanent Residents and Foreigners.

With effect from 6th July 2018, the changes made to the ABSD rates are as follow

Buyer’s ProfileABSD Rates on / after 6th July 2018
Singapore Citizens (SC) buying 1st residential propertyNot Applicable
SC buying second residential property12%
SC buying third and subsequent residential property15%
Singapore Permanent Resident (SPR) buying first residential property5%
SPR buying second and subsequent residential property15%
Foreigner (FR) buying any residential property20%
Entities buying any residential property25% + 5% for Housing Developers (non-remittable)

There are cases whereby the remission of ABSD is possible, however it is case by case basis. If you would like to know more information, click on this link that will connect you to directly to IRAS website https://www.iras.gov.sg/IRASHome/Other-Taxes/Stamp-Duty-for-Property/

The last Stamp Duty property tax has nothing to do with purchasing, instead, it might be included when you sell within a certain holding period.

Seller Stamp Duty

This is applicable when you decide to sell off your residential property within a certain holding period. There were a few changes made to the SSD rates since 2010 till today. To make things easier for you, here are the latest SSD rates with effect from 11th March 2007 that you should use as your reference if you are selling off your property within the 3 years since the date of purchase or the date when the Option to Purchase was accepted.

Holding PeriodSSD rate (on the purchase price or market value, whichever is higher)
Up to 1 year12%
More than 1 year and up to 2 years8%
More than 2 years and up to 3 years4%
More than 3 yearsNo SSD payable

If you are interested to read up more about the Seller’s Stamp Duty on Residential Properties, click on this link below!

https://www.iras.gov.sg/irashome/Other-Taxes/Stamp-Duty-for-Property/Working-out-your-Stamp-Duty/Selling-or-Disposing-Property/Seller-s-Stamp-Duty–SSD–for-Residential-Property/

These 3 types of duties payable are mandatory in Singapore, and whether you are looking to buy a home for your own stay or for investments, you will need to include these payable duties tax into your financial calculations. So do take note of them!

I do hope that you have enjoyed reading my post, and it has helped you a little more in understanding Singapore’s legal property terms. If you have any feedback or would like to learn more about any real estate related topics, do drop a comment at the bottom for me! See you soon!

Your. Exclusive. Agent
Juliana (9654-9643)

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