Singaporeans love to say “confirm plus guarantee plus chop”, but when we’re talking about buying, selling or renting property, this “chop” must pay one:
Property Stamp Duty in Singapore
Stamp duty is a tax you have to pay in order to have your documents (i.e. the Sales and Purchase Agreement between homebuyer and seller, or the Tenancy Agreement between landlord and tenant if you’re renting) legally recognised.
We’ve put together a handy guide on the stamp duties you’ll have to pay, depending on whether you’re buying, selling or renting:
1. Seller’s Stamp Duty (SSD)
2. Buyer’s Stamp Duty (BSD)
3. Additional Buyer’s Stamp Duty (ABSD)
4. Rental Stamp Duty
5. Stamp Duty Calculator
6. How to pay your Stamp Duty
Seller’s Stamp Duty
If you sell your condo within 3 years of ownership, you’re liable to pay a Seller’s Stamp Duty (SSD).
This will be calculated based on the purchase price or the market value of the property, whichever is higher:
- If you sell within first year of ownership: 12%
- If you sell within second year of ownership: 8%
- If you sell within third year of ownership: 4%
- After 3 years: No SSD payable
Because of this rule, it’s advisable only sell after the 3-year mark. (Rent it out in the meanwhile and get some passive income, because why not?)
As for HDB flats, you’ll have to fulfill the 5-year Minimum Occupancy Period (MOP) before you sell, which means there’ll be no SSD payable by then.
There are a couple of exceptions where SSD is exempted even if you sell within 3 years of ownership:
If you’re required to dispose of your properties as a result of bankruptcy:
But touch wood!
If you’re already a property owner and you inherit a HDB flat:
Because you’re not allowed to own any other property when you own a HDB flat, so in a situation like this, you’ll have to let go of one of the flats.
When you sell, you’re not bound to SSD rules.
If you have to return your flat to HDB as a result of the Selective En-bloc Redevelopment Scheme (SERS):
Some older HDB flats go through SERS, where the flats are repurchased by the government in a bid to renew the estate.
But if you bought a condo or private property and it immediately goes en bloc… Tough luck. SSD payable.
Buyer’s Stamp Duty (BSD)
Pretty self-explanatory, but here goes anyway: Buyer’s Stamp Duty (BSD) is payable when you buy a property. You’ll have to pay BSD regardless of whether you’re purchasing a condo/ private property, a resale HDB flat or even a BTO flat.
The Buyer’s Stamp Duty rate is calculated based on the purchase price or market value of the property, whichever is higher:
- First $180,000: 1%
- Next $180,000: 2%
- Next $640,000: 3%
- Remaining amount: 4%
For instance, if you managed to negotiate the price of a condo down to $1,000,000 even though it’s valued at $1,200,000, your stamp duty will be calculated based on its market value of $1,200,000:
1% of first $180,000 + 2% of next $180,000 + 3% of next $640,000 + 4% of remaining $200,000
= $1,800 + $3,600 + $19,200 + $8,000
= $32,600
Additional Buyer’s Stamp Duty (ABSD)
Additional Buyer’s Stamp Duty (ABSD) is a tax levied on non-Singapore Citizen property-buyers, as well as Singapore Citizens who already own a property, on top of the Buyer’s Stamp Duty.
Again, Additional Buyer’s Stamp Duty is calculated based on the purchase price or market value of the property, whichever is higher:
- Singaporeans: 12% on their second residential property, 15% on their third and subsequent
- PRs: 5% on their first residential property, 15% on their second and subsequent
- Foreigners: 20% on any residential property
So if you’re a Singaporean just looking to buy your one and only home to live in, don’t worry, you won’t be hit by a hefty ABSD.
But non-Singaporeans aren’t as lucky. For instance, if you’re a foreigner investing in a $1,200,000 property here in Singapore, your ABSD will be calculated as such:
20% x $1,500,000 = $240,000
Or, if you’re a Singapore Citizen and already own a condo, this is how much ABSD you’re liable to pay when you already have a house and are buying your next $1,200,000 condo as an investment:
12% x $1,200,000 = $144,000
Ouch.
Which is why more and more parents are buying their subsequent properties under their children’s names to escape this tax.
Others look to buying overseas properties, since property outside of Singapore is excluded when calculating Additional Buyer’s Stamp Duty.
There are a few other situations where you might be exempted from having to pay Additional Buyer’s Stamp Duty:
If you’re moving house (condo/ private property), but you buy before selling:
You’re a married couple moving house, but you found your next dream home before managing to sell your current property.
Technically, you own 2 houses during this transition period. Do you still have to pay the Additional Buyer’s Stamp Duty?
Yes, BUT!!! You qualify for the ABSD Spouses Remission – simply put, a refund – provided you meet the following conditions:
- At least one of you is a Singapore Citizen
- The second property is purchased in both spouses’ names
- The first property is sold within 6 months of:
- the date of purchase of the second property (if it’s a resale) OR
- the issue date of the Temporary Occupation Permit (TOP)/ Certificate of Statutory Completion (CSC), whichever is earlier (if it’s a new launch condo)
- The Additional Buyer’s Stamp Duty has been paid on the second property, and the refund application is made within 6 months after the sale of the first property
- You guys remain married. Love conquers all!
Be careful if you’re planning to buy before selling, though. If you don’t manage to sell your existing house within 6 months – for instance, if the property market suddenly plunges and there are simply no interested buyers – you’ll end up incurring the hefty Additional Buyer’s Stamp Duty. No exceptions made!
Note that this ABSD Refund is only for married couples. Unfortunately, other joint buyers (e.g. siblings, parent and child) or singles buying a property on their own don’t qualify 🙁
If you’re moving to a HDB flat, but you buy before selling:
HDB requires you to sell off any other residential property you own, HDB or condo/ private property, within 6 months of buying a HDB flat.
You won’t need to pay Additional Buyer’s Stamp Duty even if you buy your HDB first, but again, plan wisely so you don’t end up scrambling to sell your property off last-minute.
Also note that if you own a private property, you won’t be eligible for CPF Housing Grants or a HDB housing loan.
If you’re eligible for ABSD Remission under Free Trade Agreements (FTAs):
Nationals of the US, as well as nationals and PRs of Iceland, Liechtenstein, Norway and Switzerland will be accorded the same Stamp Duty Treatment as Singapore Citizens.
For instance, if a US National is buying their first residential property, they’ll be exempted from Additional Buyer’s Stamp Duty, whereas foreigners normally will have to pay 15%.
Rental Stamp Duty
Stamp duty applies when you’re renting a place too, but the good news is that it’s much, much cheaper.
Rental Stamp Duty is 0.4% of the total rent across your lease period.
For instance, if your rent is $2,000 a month for a lease period of a year, the duty will be:
$2,000 x 12 x 0.4% = $96
Rental Stamp Duty is usually bourne by the tenant, unless it’s negotiated beforehand that the landlord will bear the cost.
Tip: To avoid dispute, state who should pay the Rental Stamp Duty in the Tenancy Agreement.
Note that if you’re renewing or extending your lease as a tenant, Rental Stamp Duty is still payable as if it’s a new lease!
Read more: Tenant’s Guide: How to Rent an HDB Flat/ Room in Singapore »
Stamp Duty Calculator
To make things easier, the Inland Revenue Authority of Singapore (IRAS) has an online Stamp Duty Calculator.
Simply indicate whether you’re buying, selling or renting, and fill up the fields accordingly:
Easy peasy. The hard part is paying up…
How to pay your Stamp Duty
Stamp Duty should be paid to the IRAS. You can do this online or at any Service Bureau in Singapore:
- Online: Payment can be made via Internet Banking, GIRO, eNETS/ NETS/ credit card. Find out more here.
- At a Service Bureau: Payment can be made by cash, cheque, cashier’s order or NETS. Find the list of Service Bureau locations in Singapore here.
You can also use your CPF funds to pay for BSD and ABSD. First pay via any of the methods above; then, seek a reimbursement from your CPF account via the CPF website.
Be sure to pay your Stamp Duty on time, i.e.:
- Within 14 days of signing the relevant document if signed in Singapore OR
- Within 30 days of receiving the document if it’s signed overseas (for instance, expats signing rental contracts before moving to Singapore)
Late payments up to 3 months will incur a penalty of $10 or an amount equal to the duty payable, whichever is greater; late payments exceeding 3 months incur a penalty of $25 of 4 times the duty payable, whichever is greater.
Hidden costs of your property move
Yes, Stamp Duty can also be a significant expense in your property journey in Singapore, especially if you’re buying or selling.
This is the case anywhere in the world, actually. For instance, Thailand’s version of Stamp Duty is known as a Transfer Duty, 2% of the property value to be shared between the buyer and seller; countries like UK also have their own Stamp Duty rules.
So budget wisely before you start home hunting!
