Stamp Duty Basics for Shares

Stamp Duty is a tax on dutiable documents relating to immovable properties in Singapore and stocks and shares.

Dutiable Documents relating to Share Transfers

Dutiable documents relating to share transfers include both the physical and electronic versions of the following:

1.    Contract or Agreement (e.g. Sale and Purchase Agreement) and Transfer Instruments for Shares

These are documents that are signed when you buy or acquire shares. Stamp Duty is payable on the actual price or net asset value of the shares, whichever is higher. 

 

The additional conveyance duties (“ACD”) or share duty chargeable on the following contract/ agreement for the sale of shares may be remitted: 

Contract/ Agreement for  Duties remitted
 (A) Sale of shares that is not subject to ACD Share duty
 (B) Sale of scripless shares ACD and share duty
 (C) Aborted sale and purchase of equity interests (e.g. shares) ACD and share duty

 

There is no need to e-stamp or submit an application for remission to IRAS for (A) and (B). The relevant duties remain payable on the executed transfer instrument, if applicable. 

For more information on the remission, please refer to remission for agreements for sale of equity interests.  

2.    Mortgages for Shares

These are documents signed when you pledge your shares to obtain a loan from a bank or a financial institution. Stamp Duty is payable on the loan amount.

For exceptions, please refer to exemptions, remissions and reliefs

(New!) Electronic Documents

1. What is an electronic document?

An electronic document includes any of the following that effects a transaction in any immovable property in Singapore, and any stock or shares:

  1. An electronic record that effects the transaction;
  2. An electronic record and a physical document that together effect the transaction; or
  3. An electronic record and a verbal communication that together effect the transaction, with the electronic record concluding the transaction. 

2. What is an electronic record?

An electronic record is a record generated, communicated, received or stored by electronic means in an information system or for transmission from one information system to another.

Electronic records include anything sent by email, SMS or any Internet-based messaging service. 

 

3. What is an electronic signature?

An electronic signature is any electronic method used to identify a person and to indicate the person’s intention in respect of the information contained in an electronic record.

Examples include electronic correspondences (emails, SMS, WhatsApp), electronic signatures (as opposed to wet ink signatures), biometric signatures (retina, fingerprint, voice), clicking on a button in an online system/platform/portal, ID card inserted into a device. 

 

4. When and where is an electronic document treated as executed?

It is important to know when and where an electronic document is executed as it affects the deadline by which you need to stamp the document. For documents executed in Singapore, the document has to be stamped within 14 days after the date it has been executed. For documents executed outside of Singapore and subsequently brought into Singapore, the document has to be stamped within 30 days after it has been received in Singapore.

Please refer to the scenarios below to identify which applies to you and when and where your electronic document is treated as executed.

Scenario A

If the electronic document is an electronic record, or consists of an electronic record and a physical document/verbal communication (where the transaction is concluded by the electronic record), it is treated as executed at the time and place that an electronic signature is applied to the electronic record.

Scenario B
If the electronic document consists of an electronic record and a physical document (where the transaction is concluded by the physical document), it is treated as executed at the time and place that the physical document is signed.

 Examples
A sends an email from Malaysia offering to sell property to B. B sends an email from Singapore accepting A’s offer. The electronic document is treated as executed in Singapore and at the time B sends the second email.

A makes an offer to sell property on an Internet website. B uses a computer in Singapore to transmit his acceptance of A’s offer. The electronic document is treated as executed in Singapore and at the time B transmits his acceptance.


5. If an electronic document is executed outside of Singapore, when is it treated as received in Singapore?

It will be treated as received in Singapore in any of the following scenarios:

  1. The electronic document is retrieved or accessed in Singapore;
  2. An electronic copy is stored on a device and brought into Singapore; or
  3. An electronic copy is stored on a computer in Singapore.

 Examples
A and B effect outside Singapore a transaction by means of an electronic document, which is saved on a server outside Singapore. B downloads a copy of the electronic document in Singapore. The electronic document having been retrieved by a person in Singapore, is received in Singapore.

A and B effect outside Singapore a transaction by means of an electronic document, which is saved on a server outside Singapore. B uses a device (e.g. tablet) to view a copy of the electronic document in Singapore. The electronic document having been accessed by a person in Singapore, is received in Singapore.

A and B effect outside Singapore a transaction by means of an electronic document, which is saved on a server outside Singapore. B saves a copy of the electronic document on a device (e.g. thumb drive) and brings the device into Singapore. The electronic document having been stored on a device and brought into Singapore, is received in Singapore.

A and B effect outside Singapore a transaction by means of an electronic document, which are stored on a server in Singapore. The electronic document having been stored on a computer in Singapore, is received in Singapore. 

When to Stamp

You are required to stamp a document before you sign it. However, if you have signed a document and stamped it within the following time frame, no penalty will be charged: 

  1. Within 14 days after signing the document if it is signed in Singapore or
  2. Within 30 days after receiving the document in Singapore if the document is signed overseas

Where to Stamp

You can stamp your documents through any of the following:

Non-Payment or Late Payment of Stamp Duty

If you do not meet the deadline, you may have to pay a penalty.

A penalty of up to 4 times may be imposed on documents that are unstamped, stamped late or insufficiently stamped.

It is an offence to use a document for which stamp duty payment has not been made. 

Please refer to Late Payment of Stamp Duty for more details.

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