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Looking to buy your second or more property? Additional Buyer’s Stamp Duty (ABSD) was implemented on 8 December 2011 to moderate the demand for residential properties in Singapore. It is an additional cost on top of the existing Buyer’s Stamp Duty – which is based on the value of the property – to be paid whenever a purchase of property is made. The cost of the ABSD is dependent on various factors such as property type, buyer profile and property count. Now you might be wondering, how much more do I need to pay when I buy a piece of property? Let us find out more about ABSD Stamp Duty!
The buyer profile affects the ABSD rate that the property buyer has to pay. The amount of properties owned For example, Singaporean citizens will have the ABSD waived on their first residential property purchase but will have to pay 12% and above from the second purchase onwards. Singapore Permanent Residents on the other hand will have to pay 5% on their first property and 15% and above for subsequent properties. For example, James is a Singaporean citizen who has just bought his first property, he will not be liable to pay any ABSD. He then decides to make another property purchase in which he will be liable to pay the 12% ABSD.
Property count is the metric used to determine how much ABSD one needs to pay for their property purchase. It should be noted that co-owning a property counts that property into your property count. In this scenario, James already owns a share of his family home and recently made a purchase of a condominium unit. In this case, James will be liable to pay the 12% ABSD on his condominium unit.
Contractual agreements to buy/sell properties will also increase/decrease the property count of the buyer and seller. This is because it is deemed that the buyer and seller has expressed an interest in making the purchase/sale. For example, if a contract agreement is made for an unfinished HDB unit, it is counted under the buyer’s property count even if it has not been legally transferred.
Properties bought on trust will have ABSD payable based on the buyer profile and property count of the person the property is intended for. If multiple properties are bought within the same contract, the buyer can choose which property to pay which ABSD rate.
There are methods that people can use to manipulate their property count in order to avoid paying ABSD and one of these methods is decoupling, which we will explore in a future article. A summary of ABSD rates for each buyer profile can be found in the table below.
|Buyer Profile||Property Count|
(20 Feb 2018 onwards)
(20 Feb 2018 onwards)
|Singaporean Citizen||1st property||1% on the first $180,000|
2% in the next $180,000
3% on the next $640,000
4% on the remaining amount
|Singaporean Citizen||2nd property||12%|
|Singaporean Citizen||3rd property & above||15%|
|Singaporean Permanent Resident||1st property||5%|
|Singaporean Permanent Resident||2nd property & above||15%|
|Foreigners||Any residential property||20%|
|Entities||Any residential property||25% + additional 5% for developers|
The zoning type of properties also affects the ABSD liability of the property buyer. Properties purchased for residential purposes will be ABSD liable for 100% of the gross floor area or 100% of its value. Commercial properties such as business parks, hotels, and commercial buildings are not ABSD liable. For properties intended for both commercial and residential uses, ABSD is only paid for the residential portion of the property. A summary of the cost of ABSD for each zoning type can be found in the table below.
|Zoning Type||ABSD Liability|
|Residential||100% of gross floor area|
|Residential with Commercial section at first storey||Total gross floor area – minimum gross floor area set aside for commercial purposes in the Master Plan|
|Commercial & Residential||60% of gross floor area|
|White||100% of gross floor area|
|Residential/Institutional||100% of gross floor area|
|Non-residential (e.g. Hotels, Business Parks, etc.)||Not Applicable|
ABSD stamp duty can be very costly for the average property buyer, so it is important to buy smart. Here at LegallySmart, we have helped many buyers and sellers close their property transactions and we believe that we can help you to get the best price on your investments!
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