Stamp Duty on leases is payable based on the contractual rental or the market rental, whichever is higher, at the Lease Duty rates.

Stamp duty is payable on documents relating to leases of immovable properties in Singapore such as :

  • Lease or tenancy agreement

Please note that licence agreements are not subject to stamp duty. Licence agreements are commonly used for the letting out of a food stall in a food court, coffeeshop or hawker centre. If you are unsure if your agreement is a licence or a lease/tenancy, you may wish to seek independent legal advice or submit the document for adjudication. Please note that adjudication fees will be payable for the latter.

Lease with Fixed Rent

A lease with fixed rental is one for which a fixed rental is agreed upfront for the entire lease period. Stamp duty on the fixed rental is based on lease duty rates.

Lease with Premium

A lease with premium is one for which there is a lump sum payment. Stamp duty is payable on the premium based on the BSD rates. If there is a rental in addition to the premium, stamp duty is payable on the rental based on lease duty rates.

Lease with Variable Rent

A lease with variable rental is one for which the rental varies during the lease period.

e.g.

  1. Staggered rental for different periods of the lease
  2. There is a fixed rental component and an additional rental component based on a percentage of the gross sales turnover (GTO)

In a lease involving an additional rental component based on a percentage of the GTO, you are to estimate the GTO and determine the additional rent payable. This additional rent shall be included for the stamp duty calculation i.e. the rent that is subject to stamp duty is the sum of the fixed rental (if any) and the additional rental derived from the estimated GTO.

Where the additional rental component is subject to a maximum or minimum secured sum, the additional rent that is subject to stamp duty shall be:

Types of additional rental component Additional rent subject to stamp duty
Based on a percentage of GTO, subject to a maximum secured sumThe maximum secured sum
Based on a percentage of GTO, subject to a minimum secured sumThe higher of the amount derived from the estimated GTO or the minimum secured sum

Additional rent subject to stamp duty

Please refer to Examples 1 to 3 below on the calculation of stamp duty for leases involving staggered rental or a percentage of GTO.

Variation of Lease or Supplemental Agreement

If there is an increase in rental or the lease period is extended, stamp duty is payable on the document based on the increase in rental or the rental for the extended lease period.

However, if there is a decrease in rental or the lease period is shortened, stamp duty is not payable for the document.

Other variations where stamp duty is not payable

  1. Changing the use of the property with no additional payment;
  2. Lifting the restrictions in the lease with no additional payment;
  3. Amending the terms of the lease that do not affect the rental and lease term such as addition of an option to renew;
  4. Bringing forward or deferring the lease before its commencement without a change in the lease term or gross rent.

Please refer to Examples 4 to 6 below on the calculation of stamp duty for variation of leases.

Surrender of Lease

Stamp duty is payable on the consideration paid by the landlord to the tenant for the surrender of lease at the BSD rates.

Rates and Computation

Average Annual Rent (AAR)1 Lease Duty Rates
AAR does not exceed $1,000Exempted
AAR exceeds $1,000
Lease period of 4 years or less0.4% of total rent for the period of the lease
Lease period of more than 4 years or for any indefinite term0.4% of 4 times the AAR for the period of the lease

Lease duty is rounded down to the nearest dollar, subject to a minimum duty of $1.

1AAR refers to the higher of the average annual contractual or annualised market rent and includes other considerations such as payments for:

  • Advertising and Promotion charge
  • Furniture / Fittings charge
  • Maintenance charge
  • Service charge
  • Any other charges, excluding GST charges

Example 1: Lease with Staggered Rent (4 Years or Less)

Lease Period & Rent Lease Duty

3-month Lease
1st Month: $3,000
2nd Month: $3,000
3rd Month: $4,000

Total Rent
$3,000 + $3,000 + $4,000 = $10,000

Lease Duty
0.4% x $10,000 = $40.00

4-year Lease
1st Year: $3,500 per month
2nd Year: $4,000 per month
3rd Year: $4,300 per month
4th Year: $5,300 per month

Total Rent
($3,500 + $4,000 + $4,300 + $5,300) x 12 = $205,200

Lease Duty
0.4%  x $205,200 = $820.80
$820.00 (rounded down to the nearest dollar)

 

Example 2: Lease with Staggered Rent (More than 4 Years)

Lease Period & Rent Lease Duty

5-year Lease
1st Year: $1,800 per month
2nd Year: $2,000 per month
3rd Year: $2,500 per month
4th Year: $3,000 per month
5th Year: $3,300 per month

Total Rent
($1,800 + $2,000 + $2,500 + $3,000 + $3,300) x 12 = $151,200

Average Annual Rent
$151,200 / 5 years = $30,240

4 Times of AAR
= $30,240 x 4 = $120,960

Lease Duty
0.4%  x $120,960 = $483.84
$483.00 (rounded down to the nearest dollar)

 

Example 3: Lease on Commercial Unit Where Rent or Part of Rent is Percentage of Tenant's Sales Turnover (3 Years)

i) A lease with fixed rental and an additional rental based on a percentage of gross sales turnover (GTO), without a maximum or minimum secured sum

Monthly Rent
  • $5,000 and
  • 0.5% of GTO
Estimated Gross Sales Turnover$100,000
Service Charge$400 per month
Advertising and Promotional Charge$100 per month

To calculate the Stamp Duty payable:

Additional Rent subject to Stamp Duty0.5% x GTO = 0.5% x $100,000 = $500
Estimated Gross Rent Per Month$5,000 + $500 (i.e. the additional rent) + $400 + $100 = $6,000
Total Rent$6,000 x 36 months = $216,000
Stamp Duty Payable0.4% x $216,000=$864.00

ii) A lease with fixed rental and an additional rental based on a percentage of GTO that is subject to a minimum secured sum

Monthly Rent
  • $5,000 and
  • 0.5% of GTO, subject to a minimum secured sum of $600.
Estimated Gross Sales Turnover$100,000
Service Charge$400 per month
Advertising and Promotional Charge$100

To calculate the Stamp Duty payable:

Additional Rent subject to Stamp Duty

The higher of the amount derived from the estimated GTO or the minimum secured sum:

  • $500 (i.e. 0.5% of GTO); or
  • $600 (the minimum secured sum)

The additional rent subject to stamp duty would be $600

Estimated Gross Rent Per Month$5,000 + $600 (i.e. the additional rent) + $400 + $100 = $6,100
Total Rent$6,100 x 36 months = $219,600
Stamp Duty Payable

0.4% x $219,600 = $878.40

$878 (rounded down to the nearest dollar)

iii) A lease with fixed rental and an additional rental based on a percentage of GTO that is subject to a maximum secured sum

Monthly Rent
  • $5,000 and
  • 0.5% of GTO, subject to a maximum secured sum of $650.
Estimated Gross Sales Turnover$100,000
Service Charge$400 per month
Advertising and Promotional Charge$100 per month

To calculate the Stamp Duty payable:

Additional Rent subject to Stamp DutyMaximum secured sum = $650
Estimated Gross Rent Per Month$5,000 + $650 (i.e. the additional rent) + $400 + $100 = $6,150
Total Rent$6,150 x 36 months = $221,400
Stamp Duty Payable

0.4% x $221,400 = $885.60

$885 (rounded down to the nearest dollar)

Example 4: Increase in Rental Where the Original Lease Period and Parties Remain the Same (More Than 4 Years)

Original Lease Period & Rent Variation of Lease / Supplemental Agreement

5-year Lease
1st Year: $1,800 per month
2nd Year: $2,000 per month
3rd Year: $2,500 per month
4th Year: $3,000 per month
5th Year: $3,300 per month

5-year Lease
1st year: $2,000 per month
2nd year: $2,500 per month
3rd year: $3,500 per month
4th year: $3,800 per month
5th year: $4,300 per month
Total Rent
($1,800 + $2,000 + $2,500 + $3,000 + $3,300) x 12 =  $151,200
Total Rent
($2,000 + $2,500 + $3,500 + $3,800 + $4,300) x 12 = $193,200
Average Annual Rent
$151,200 / 5 = $30,240
Average Annual Rent
$193,200 / 5 = $38,640
Total Rent (Capped at 4 Years)
$30,240 x 4 = $120,960
Total Rent (Capped at 4 Years)
$38,640 x 4 = $154,560
 

Increase in Total Rent (Capped at 4 Years)
$154,560 - $120,960 = $33,600

 

Stamp Duty Payable (0.4% of the increase in Total Rent & Capped at 4 Years)
0.4% x $33,600 = $134.40

$134 (rounded down to the nearest dollar)

Example 5: Bringing forward / Deferring the lease without changes in lease term and gross rent

If the lease period has not commenced, and the lease was brought forward or deferred without any changes in the gross rent or lease term, stamp duty is not payable.

i) Bringing forward the lease

Original Lease Period & Rent Variation of Lease / Supplemental Agreement before lease commences
6-month lease
1 Jun 2020 – 30 Nov 2020
6-month lease where lease start date was brought forward to 1 Apr 2020
1 Apr 2020 – 30 Sep 2020
Monthly Rent
$3,000 per month
Monthly Rent
$3,000 per month
Total Rent
$3,000 x 6 = $18,000
Total Rent
$3,000 x 6 = $18,000
  Stamp Duty is not payable on the Variation of Lease as there is no change in the gross rent or lease period

ii) Deferring the lease

Original Lease Period & Rent Variation of Lease / Supplemental Agreement before lease commences
12-month lease
1 Jun 2020 – 31 May 2021
12-month lease where the lease start date was deferred to 1 Sep 2020
1 Sep 2020 – 31 Aug 2021
Monthly Rent
$5,000 per month
Monthly Rent
$5,000 per month
Total Rent
$5,000 x 12 = $60,000
Total Rent
$5,000 x 12 = $60,000
  Stamp Duty is not payable on the Variation of Lease as there is no change in the gross rent or lease period

Example 6: Extension of a lease term without change in gross rent

The landlord grants an extension to the lease period, but provided a rent-free period equivalent to the extended period. Stamp duty is payable on the extended period.

Original Lease Period & Rent Variation of Lease / Supplemental Agreement
12-month lease
1 Jan 2020 – 31 Dec 2020
15-month lease where the original lease period was extended by 3 months
1 Jan 2020 – 31 Mar 2021
Monthly Rent
$10,000 per month
Monthly Rent
First 3 months: $10,000 per month
Next 3 months: $0 (Rent-free period)
Remaining 9 months: $10,000 per month
Total Rent
$10,000 x 12 = $120,000
Total Rent
First 3 months: $10,000 x 3 = $30,000
Next 3 months: $0 (Rent-free period)
Remaining 9 months: $10,000 x 9 = $90,000
Total Rent: $30,000 + $0 + $90,000 = $120,000
  Stamp Duty Payable (0.4% of the rent for the extended period from 1 Jan 2021 – 31 Mar 2021)
0.4% x ($10,000 x 3) = $120

For rates before 22 Feb 2014, please refer to Stamp Duty for Property.

Please refer to How to stamp Lease or Tenancy Agreements for the illustrated guide for stamping a Lease or Tenancy Agreement.