Stamp Duty for Property Transactions Explained

STAMP DUTY FOR PROPERTY TRANSACTIONS EXPLAINED

Whenever there is a change of ownership of residential property in Singapore, the transaction must be taxed. The taxes that must be paid are as follows: (1) a Buyer’s Stamp Duty (BSD); and (2) Additional Buyer’s Stamp Duty, if applicable (ABSD).

What is BSD & How Much Is It?

BSD must be paid when transferring or buying Singapore real estate. BSD is based on the purchase price or market value (the higher amount).

BSD Rates (for transactions after 20 Feb 2018)

Purchase Price or Market Value of Property

BSD for Residential Property

First $180,000

1%

Next $180,000

2%

Next $640,000

3%

Remaining amount (above S$ 1 million)

4%

As you can see, the BSD is taxed at a different rate depending on how much the home cost to buy or how much it is worth on the market. So, people who can afford more expensive homes will pay a higher BSD, while people who buy cheaper houses will pay less.

Illustration

  • If we purchase a home worth $500,000, the BSD payable is $9,600. 
  • If we purchase a home worth $2 million, the BSD payable is $64,600.

What Is ABSD & How Much Is It?

ABSD was part of a series of cooling measures implemented by the Monetary Authority of Singapore to limit speculative demand for residential properties in Singapore.

Since its introduction, the ABSD has undergone multiple revisions, and the Monetary Authority of Singapore has maintained that there are no intentions to relax property cooling measures.  The latest revisions were announced on 8 May 2022.

The buyer’s profile at the time of the purchase of the residential property will determine whether ABSD is payable, and if so, the amount of ABSD that must be paid.

ABSD must be paid in addition to the existing BSD by applicable buyers.

ABSD Rates (for transactions after 9 May 2022)

Buyer ProfileABSD Rate 
SC–1st residential propertyN.A.
SC–2nd residential property17%
SC–3rd & subsequent residential property25%
SPRs–1st residential property5%
SPRs–2nd residential property25%
SPRs–3rd & subsequent residential property30%
Foreigners–any residential property30%
Entities buying any residential property35%

While the BSD is based on a percentage of the property’s selling price, the ABSD is fixed. The amount we must pay varies according to our nationality (whether we are Singaporeans, PRs, or foreigners) and the number of properties we own, as shown in the table.

Singaporeans must pay an ABSD of 17% when buying a second residential property.

Illustration

If we want to buy a second home that costs $2 million, we must pay:

BSD + ABSD = $64,600 + $340,000 = $404,600

Count of Residential Properties Owned

 

(A) Count from the Date of the Sale and Purchase Agreement

If the Option to Purchase has been exercised, it should be counted as one of the buyer’s properties as of the day he exercised the Option, even if the property has not yet been legally transferred to him.

This includes purchasing a unit from the developer before its completion if the Sale and Purchase Agreement has been executed.

Similarly, the property should not be regarded as one of the buyer’s properties if the new buyer has exercised his Option to Purchase.

 

(B) Partial / Joint Ownership

Ownership of any interest in a property is counted as part of a buyer’s total property holdings.

Illustration

John jointly owns a property with his wife – Count 1
John owns a property with his brother, percentage ownership 30% – 70% – Count 2
The number of properties owned by John is 2.

 

(C) Multiple Properties in a Single Transaction

Many residential properties can be purchased under one contract. However, each residential property will be counted as its own.

 

(D) HDB Shop with Living Quarters

HDB shops with living quarters or shophouses with residential use will be included as a residential property count.

 

(E) Residential Properties Not in Singapore

All residential properties not located in Singapore will not be included in the count of residential properties owned.

When Must BSD & ABSD Be Paid?

If the BSD applies to you, the ABSD must be paid within 14 days from the exercise of the Option to Purchase or the date the Sale & Purchase Agreement is signed.

What About Inherited Properties?

IRAS has clarified that BSD and ABSD are not payable on properties acquired by inheritance. However, such properties are included in the property count if further residential property purchases are made.

We offer video consultation via Lawyer Anywhere so that you can get the help you need. We can walk you through the process and answer any questions you may have. Contact us today to get started!

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Susan Tan

Senior Legal Executive

Qualifications:

With more than 10 years of experience in the financial industry, Susan Tan, who joined us from one of the leading corporate and investment banks in Singapore, provides invaluable expertise and knowledge in corporate secretarial.

She is conversant and familiar with the local regulations and requirements for business entities in Singapore.

As a member of our team, Susan is responsible for maintaining and updating the Company’s statutory registers and records, filing all necessary documents and forms with the Accounting & Corporate Regulatory Authority (ACRA), Ad-hoc assignments such as allotment and transfer of shares, amendment of Company’s Constitution and submission of Annual Return to ACRA.

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