Remission of ABSD (Trust)
Where remission of ABSD (Trust) has been granted, a refund of part or all of the ABSD (Trust) of 35% paid will be refunded.
The amount refunded will be based on the difference between the ABSD (Trust) paid and the ABSD payable based on the highest profile of the beneficial owners of the residential property in the transaction.
All applications for the remission must be made within 6 months from the date of execution of the instrument.
Conditions for Remission
- The residential property is held on trust for identifiable individual beneficiaries only
Identifiable Individual Beneficiary
An identifiable individual beneficiary of a trust for whom an estate or interest in residential property is held on trust, is an individual —
(a) who is identified in the declaration of trust as a beneficiary of the property whether solely or together with another; and
(b) who, because of the trust, has beneficial ownership of the property (whether solely or together with another) that is not, under the terms of the trust, revocable, variable, or subject to any condition subsequent,
but excludes an individual who is entitled to any estate or interest in property in remainder or reversion.
The following are not considered to be an identifiable individual beneficiary:
(a) an individual who has not been born on the date of declaration of the trust;
(b) an individual who is entitled only to the income of the property under the trust;
(c) an individual whose estate or interest in the property under the trust is a contingent or discretionary interest, or who becomes entitled to an estate or interest in the property only upon revocation of the trust.
2. ABSD (Trust) of 35% has been paid
3. The application is made within 6 months from the date of the instrument
Link to legislation
Please click here to access the remission rules.
How to apply
- Copy of the trust instrument
- Copy of the Option to Purchase / Sale and Purchase Agreement (if applicable)
FAQs
I executed an Acceptance to Option to Purchase on 15 Jun 2022 to purchase a residential property on trust for my wife (Singapore citizen), who currently also owns one other residential property. I had also executed a declaration of trust to state that I am holding the property on trust for my wife who is the sole beneficial owner of this trust property. If the beneficial ownership has vested in my wife, and there are no other provisions in the trust to revoke, amend or which subject my wife’s beneficial ownership in the trust property to any conditions, will I be eligible for remission of ABSD (Trust)?
ABSD (Trust) of 35% is payable as the property was purchased on trust for your wife. You will need to make upfront payment of ABSD (Trust) before making a remission application where IRAS will assess whether the refund conditions are met.
For this case, if you apply within the deadline with the necessary supporting documents, you will be eligible for remission of the difference between the ABSD (Trust) amount paid and the ABSD payable had your wife purchased the property directly in her name. As this is the second residential property owned by your wife, the total amount of ABSD refunded will be 18% (being 35% - 17%).
I executed an Acceptance to Option to Purchase on 20 Jun 2022 to purchase a condominium unit on trust for child who is a minor (Singapore citizen). This is my child’s first residential property. I also executed a declaration of trust to state that I am holding the condominium unit on trust for my child, who is the sole beneficial owner of this trust property. If the beneficial ownership has vested in my child, and there are no other provisions in the trust to revoke, amend or which subject my child’s beneficial ownership in the trust property to any conditions, will I be eligible for remission of ABSD (Trust)?
ABSD (Trust) of 35% is payable as the property was purchased on trust for your child. You will need to make upfront payment of ABSD (Trust) before making a remission application where IRAS will assess whether the refund conditions are met.
For this case, if you apply within the remission deadline with the necessary supporting documents, you will be eligible for remission of the difference between the ABSD (Trust) amount paid and the ABSD payable had your child purchased the property directly in his/her name. As this is the first residential property owned by your minor child, the total amount of ABSD refunded will be the full 35% ABSD that had been paid earlier.
I executed a declaration of trust on 9 May 2022 to declare that I am holding a condominium unit on trust for my minor child whose beneficial interest in the property will only vest at the age of 21. Will I be eligible for remission of ABSD (Trust)?
I have submitted an application for remission of ABSD (Trust). How long is the processing time and when can I expect to receive the refund if my application is approved?
Most applications will be processed within 2 months from the date of complete information being submitted. Where the application has been approved, the refund will be made within 1 month after approval.
I executed an Acceptance to Option to Purchase on 1 Jul 2022 to purchase an apartment and executed a Declaration of Trust to declare that I am holding the property on trust for my child. Can I submit an application for upfront remission instead of paying 35% ABSD and then obtaining a refund?
No, it is a condition under the Stamp Duties (Trusts for Identifiable Individual Beneficiary) (Remission of ABSD) Rules 2022 that the ABSD chargeable on the instrument has to be paid before remission can be granted.
As such, we are unable to grant any remission of ABSD before ABSD (Trust) is paid.
Please stamp the instrument within 14 days after the execution of the document if it is executed in Singapore or, if first executed outside Singapore, within 30 days after it has been first received in Singapore, and make payment before the due date to avoid incurring late stamping penalties.
If I intend to execute a Will stating that my residential property will be held on trust for my child upon my death, will this trust be subject to ABSD (Trust) of 35%?
ABSD (Trust) applies to the transfer of any residential property into a living trust on or after 9 May 2022. A living trust is defined as one that is created by a person (settlor) within his or her lifetime and does not include a testamentary trust (i.e. a trust that is made using a Will and which takes effect after the settlor’s death).
As the trust in this scenario is a testamentary trust, hence ABSD (Trust) does not apply.