Pointers for Buyers of Private Residential Properties

1. Property Tax Liabilities
2. Notify Change of Ownership
3. Property Tax Assessment
4. Payment Arrangement 
5. File Property Tax Claims 
6. Other Taxes on Property  

1. Property Tax Liabilities

Once IRAS is notified of the property transfer, all property tax related correspondence including property tax bills will be sent to you as the new owner. As the property owner, you will be liable for all property tax on the property.  Hence it is important that you, through your lawyer, enquire if there are any outstanding or future property tax liabilities, and make provisions for the seller to reimburse you for the property tax amount that is to be borne by him.

Enquire on outstanding property tax liability

Property Tax is payable in advance by 31 January every year. If you are buying the property after January, the seller ought to have paid property taxes from previous years as well as the current year.  Before you buy we advise you to check if there is any outstanding property tax as you may be subsequently billed for any outstanding property tax that has not been paid by the previous owner/s. We encourage you to arrange for payment by GIRO for your tax obligations.

Enquire on possible future property tax liability

If you are buying a property that is under construction or newly completed and hence not assessed for property tax yet, you may be billed for the property tax that starts from the TOP date. This is usually within one year of TOP date for residential properties.  Your lawyer would usually assist you in seeking any reimbursement of property tax from the seller/developer if the property is transferred to you after the TOP date.

Apportion property tax liabilities 
 
The apportionment of property tax liabilities is a private arrangement between the seller and buyer.  Your lawyer would normally make a legal requisition to check on the outstanding property tax, and make provisions to settle the outstanding amount with the seller. IRAS does not apportion nor arbitrate property tax liabilities between the parties. All bills and notices after the transfer of the property will be sent to you as the new owner.

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2. Notify Change of Ownership

You may wish to remind your lawyer to ensure that the seller/transferor’s lawyer has filed a Notice of Transfer to notify IRAS within one month of the property transfer.  IRAS will update the ownership record for property tax purpose based on the information given.  

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3. Property Tax Assessment

Property Tax is a tax on the property, and is payable by the owner whether or not the property is owner-occupied, rented out or vacant. It is unlike income tax which is levied only when owners derive rental income from properties.

How is Property Tax calculated?

Property Tax is calculated based on a percentage (Tax rate) of the Annual Value (AV) of your property.

The current tax rate is 10% per year.  If you owner-occupy your home, you may apply for owner-occupier’s tax rates. You need to log in to myTax Portal  with your SingPass > e-Services for Property Tax > Apply for owner-occupier’s tax rates. Prior to 1 Jan 2011, the tax rate was a flat rate of 4%. 

Owner-Occupier’s Tax Rates with Effect from 1 Jan 2011

In Budget 2010, the Government announced a shift from the current system of a flat 4% property tax rate for all owner-occupied residential properties to progressive owner-occupier’s tax rates based on the Annual Values (AVs) of your property as follows:

Example 1: AV of your house is $24,000

Example 2: AV of your house is $84,000

4. Payment Arrangement

We encourage you to pay your Property Tax by GIRO as you will enjoy up to 12 interest-free monthly instalments.  Alternatively, you may check out other available modes of payment. 
 
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5. File Property Tax Claims

If you owner-occupy your home, you may apply for owner-occupier’s tax rates.  If you are a Singaporean or Singapore Permanent Resident who own and occupy only one private residential property or executive condominium, you need not apply as the concession will be granted automatically.

If your property has been vacant for more than 30 days or a calendar month despite attempts to rent it out, you may apply for a refund of tax for the vacant period.

 
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6. Other Taxes on Property

Rent received from the letting of property in Singapore is subject to income tax. Find out more on Rent & Net Annual Value (NAV).

Generally, the gains derived from the sale of a property in Singapore, or capital gains, are not taxable. However, when a person is deemed to be trading in properties, the gains from the sale of property in Singapore is income and it is taxable. Find out more on Gains from sale of property.

If you purchase and sell a residential property within four years of acquisition, you are required to pay seller’s stamp duty.

When you buy any property, you need to pay Stamp Duty within 14 days of the date of Contract/Agreement.  In most instances, your lawyer acting for you in the purchase of the property will arrange for payment of Stamp Duty.
  
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FAQs