When you buy a property in Singapore, there are many other financial expenses in addition to the purchase price. Legal fees is one example. Others are taxes such as Buyer’s Stamp Duty and the Additional Buyer’s Stamp Duty (ABSD) if applicable. Today, let’s take a look at Buyer’s Stamp Duty or BSD for short.
BSD is a tax levied on documents signed when you acquire / purchase a property in Singapore. It is applied to every property buyer, be it a private residential home, HDBs or commercial / industrial property.
The rate of BSD you required to pay will be based on the higher of
• The property purchase prices as stated in the Sale & Purchase Agreement or
• The market value of the property based on valuation reports.
The tax is payable even if you acquire the property by way of gift.
The BSD is computed based on the purchase price or market value of the acquired property, whichever is higher. The rate ranges from 1% to 4%.
Below is the table of BSD rates with effect from 20 Feb 2018.
|Purchase Price / Market Value of Property||BSD Rates for Residential Property||BSD Rates for Non-Residential Property|
Let’s see how this works in an example :
Assume that the purchase price is $2,000,000 on 15 March 2018. The table below will show the computation of BSD for this purchase.
|Purchase Price / Market Value of Property||BSD Rate||Calculation||Total BSD Payable||= $64,600|
|First $180,000||1%||= $1,800 (1% x $180,000)|
|Next $180,000||2%||= $3,600 (2% x $180,000)|
|Next $640,000||3%||= $19,200 (3% x $640,000)|
|Remaining $1,000,000||4%||= $40,000 (4% x $1,000,000)|
The tax is payable within 14 days upon signing of the Sale & Purchase Agreement. If the document is signed overseas, this timeline is extended to 30 days.
You can e-stamp and pay the stamp duties using the appropriate e-form on the IRAS e-Stamping website. Information you need to prepare beforehand the buyers and sellers details, property address and the price/market value of the residential property.
Remember you have to pay within 14 days from the date of the execution of the sale.
In this article, we try to explain the fundamentals of Buyer’s Stamp Duty in a simple manner. Hope this article has help you understand the BSD tax levied when you buy a property in Singapore. You may want also to take a look at the Additional Buyer’s Stamp Duty (ABSD) that you may be liable for , depending on your profile.