my SG Properties: Additional Buyer Stamp Duty on Purchase of Residential Properties

On 7 December 2011, the Government announced the introduction of the Additional Buyer’s Stamp Duty (ABSD) to be paid by certain groups of people who buy or acquire residential properties (including residential land) on or after 8 Dec 2011.
On 11 Jan 2013, the Government announced the revised ABSD rates applicable to purchases or acquisitions of residential properties on or after 12 Jan 2013.
Affected buyers are required to pay ABSD on top of the existing Buyer’s Stamp Duty (BSD).

Affected Buyers & ABSD Rates

Between 8 Dec 2011 and 11 Jan 2013 (both dates inclusive), buyers or transferees who are :
a) Foreigners (FR) and entities* would have to pay ABSD of 10% on the purchase or acquisition of any residential property.
b) Singapore Permanent Residents (SPR) who already own^# 1 or more residential properties would have to pay ABSD of 3% on the purchase or acquisition of another residential property.
c) Singapore Citizens (SC) who already own^# 2 or more residential properties would have to pay ABSD of 3% on the purchase or acquisition of another residential property.
From 12 Jan 2013, buyers or transferees who are :
a) FR and entities* would have to pay ABSD of 15% on the purchase or acquisition of any residential property.
b)(i) SPR would have to pay ABSD of 5% on the purchase or acquisition of their first residential property.
(ii) SPR who already own^# 1 or more residential properties would have to pay ABSD of 10% on the purchase or acquisition of another residential property.
c)(i) SC who already own^# one residential property would have to pay ABSD of 7% on the purchase or acquisition of the second residential property.
c)(ii) SC who already own^# two or more residential properties would have to pay ABSD of 10% on the purchase or acquisition of another residential property.
^# Whether owned wholly, partially or jointly with others.
* Entity means a person who is not an individual, and includes an unincorporated association, a trustee for a collective investment scheme when acting in that capacity, a trustee-manager for a business trust when acting in that capacity and, in a case where the property conveyed, transferred or assigned is to be held as partnership property, the partners of the partnership whether or not any of them is an individual.
The ABSD is payable by affected buyers at fixed rates on the actual price paid or market value of the property whichever is the higher.
BSD continues to be payable by all property buyers at unchanged rates.

Effective Date of ABSD

The old ABSD rates apply to Contracts or Agreements (whichever is earlier), or Documents of Transfer*, dated on or after 8 December 2011, but before 12 Jan 2013.
The new ABSD rates will apply to Contracts or Agreements (whichever is earlier), or Documents of Transfer*, dated on or after 12 Jan 2013.
Where an Option To Purchase has been granted on and before 11 Jan 2013 and exercised thereafter on or before 1 Feb 2013 without any extension of the option validity period, the old ABSD rates may apply subject to approval for remission by IRAS (see Remission/ Refund).

Buyer's Stamp Duty (BSD) and Additional Buyer's Stamp Duty (ABSD) Rates

Profile of buyer	BSD rates*	ABSD rates (old)⁺ from 8 Dec 2011 to 11 Jan 2013	ABSD rates (new)⁺ from 12 Jan 2013
FR and entities buying residential property	1% on first $180,000 2% on next $180,000 3% for the remainder	10%	15%
SPR buying 1^st residential property		Nil	5%
SPR buying second and subsequent residential property		3%	10%
SC buying the first residential property		Nil	Nil
SC buying second residential property		Nil	7%
SC buying the third and subsequent residential property		3%	10%

* The consideration or value has to be rounded up to the nearest $100 before applying the rate.⁺ ABSD is to be rounded down to the nearest dollar.

ABSD Rates Depend on Profile(s) of Buyer(s) or Transferee(s)

Purchase Made by One Buyer

Whether ABSD is payable and which ABSD rate would apply would depend on the profile of the buyer – whether the buyer is an individual or non-individual, his residency status and the count of residential properties owned by him. Please refer to Buyer’s Stamp Duty (BSD) and Additional Buyer’s Stamp Duty (ABSD) Rates for more information.

Purchase Made by Multiple Buyers with Different Profiles

If the property is jointly bought (either joint tenancy or tenancy-in-common) by buyers with different profiles, the higher ABSD rate will apply on the purchase price/ value of the property.

For example, if a FR, a SPR and a SC jointly buy a property worth $3 million, with each owning one-third share, the ABSD rate of 15%* shall apply to the $3 million, notwithstanding that the other two purchasers are non foreigners and have paid $2 million for their share of the property.

Remission applies to purchases by married couples of certain profile.

*For acquisition made on or after 12 Jan 2013. ABSD rate of 10% applies if acquisition is made between 8 Dec 2011 to 11 Jan 2013 (both dates inclusive).

Computation of BSD and ABSD

Stamp duty amount is computed by applying the relevant stamp duty rates on the actual price paid or market value of the property, whichever is the higher.

The BSD is calculated based on a tiered-rate structure, i.e. 1% on the first $180,000, 2% on the next $180,000 and 3% on the amount exceeding $360,000.
The ABSD rates on the other hand are flat rates of 3%, 5%, 7%, 10% or 15% to be applied on the actual price paid or market value of property, whichever is higher.
For a mixed use property with residential component e.g. a HDB shop with living quarters, ABSD is computed on the actual price paid or market value (whichever is higher) attributable to the residential component only. The market value may be determined by a professional valuer or adjudicated by IRAS.
For purchase of a partial interest in a residential property, ABSD is computed on the actual price paid or market value (whichever is higher) of the partial interest only.

Illustration of Computation of BSD and ABSD

Assume a purchase of a flat at a fair market price of $2 million by a FR and the ABSD rate of 15%* applies.

*For acquisition made on or after 12 Jan 2013. ABSD rate of 10% applies if acquisition is made between 8 Dec 2011 to 11 Jan 2013 (both dates inclusive).