If you decided to relocate to one of the world’s safest tax havens, you might consider buying a property in the city-state. Before starting to search for your new home, there are certain taxes on property purchase in Singapore that you should be aware of. These taxations consist of: the stamp duty tax, goods and services tax (GST), seller stamp duty tax, yearly property taxation and rental income tax.
We invite you to watch the following video on the taxes applicable for property purchase in Singapore:
The stamp duty tax in Singapore
As one of the taxes on property purchase in Singapore, the stamp duty tax is applied when you acquire a residential and commercial real estate in the city-state. Its rates are levied as follows:
• First SGD 180,000: 1%; • The following SGD 180,000: 2%; • Over SGD 360,000: 3%.
The goods and services tax is another taxation on property purchase in Singapore which is applied when you buy a commercial property, if the seller is GST registered. The GST rate in Singapore is currently set at 7%.
The seller stamp duty tax
The seller stamp duty taxation is applied on residential and industrial real estate. Its rates are as described below:
• Sell within 1st year: 16% of selling cost or valuation, whichever is higher; • Sell within 2nd year: 12% of selling cost or valuation, whichever is higher; • Sell within 3rd year: 8% of selling cost or valuation, whichever is higher; • For sell within more years, our accountants in Singapore can provide you with the exact rates for this type of taxation.
The yearly property taxation in Singapore
Just like in any other state, owning a property in Singapore requires the payment of a yearly property taxation. This type of tax on property purchase in Singapore depends on whether the real estate is owner occupied or it is an investment real estate.
For owner occupied real estates, the yearly property taxation rate ranges from 0% for an yearly value (YV) of first SGD 8,000 to 16% for an YV of over SGD 130,000. As for non-owner occupied real estates, the rates range from 10% for an YV of first SGD 30,000 to 20% for an YV of over SGD 90,000. An accountant in Singapore can provide more information on this matter.
The rental income tax
The rental income tax in Singapore is the real estate tax which is due if you rent a part of or the entire real estate. The net rental income tax rate is 20% for foreign citizens; however it will be increased to 22% starting with the Year of Assessment 2017.
Please get in touch with our accounting firm in Singapore to calculate the exact rates of the taxes on your property purchase.