Property Stamp Duty Singapore (ABSD,BSD,SSD): Easy formula for calculations

The Singapore government is well known for being an interventionist when it comes to the property market. Besides financing requirements, one other way they control property demand is through a form of tax called stamp duty.

The Inland Revenue Authority of Singapore (IRAS) collects two stamp duties imposed on the buyer: Buyer’s stamp duty (BSD) and Additional buyer’s stamp duty (ABSD). There is another type of stamp duty, called Seller’s Stamp Duty (SSD), but it has to be paid by the seller (not the buyer) when they sell a property within a specific timeframe.

These property taxes ensure Singapore citizens and Permanent Residents have priority in home ownership. They also prevent roller-coaster prices that would hurt the economy and, ultimately, the cost of living.

On the lookout for a new home?

Here are a few things you should know about property stamp duties on residential properties in Singapore:

• What is buyer stamp duty?
• How to calculate buyer stamp duty using a formula
• What is additional buyer stamp duty (ABSD)?
• How to calculate ABSD using a formula
• How to avoid ABSD for a second property
• When to pay for stamp duty and using CPF
• Consequences of late payment of stamp duties
• What is seller stamp duty (SSD)?
• How to calculate SSD using a formula
• Exemptions for seller stamp duty

What is buyer’s stamp duty (BSD) in Singapore?

Buyers Stamp Duty (BSD) is levied on all purchases of immovable properties in Singapore, including HDB or private residential and commercial or industrial properties.

A property is considered purchased when the buyer exercises their Option to Purchase (OTP) or has signed the Sale & Purchase Agreement. The amount of BSD is calculated based on the higher price of your property’s purchase price or market value.

Buyer stamp duties are always calculated on the bank-indicated property valuation or purchase price, whichever is higher.

Note that BSD is not subject to the buyer’s nationality or the number of properties the buyer owns (unlike ABSD, which we will discuss below).

Let’s understand this with an example. Let’s say Alex buys a property with a selling price of $2,500,000. The market value (valuation) of this property is $2,700,500. Since the valuation amount is higher than the actual purchase price, the BSD will be calculated on the valuation figure of $2,700,500.

Increase in Buyer Stamp Duty Rates

With effect from 15 February 2023, the revised BSD rates now result a higher marginal BSD rate for higher-value residential and non-residential properties has been imposed. It was announced in Singapore’s Budget speech in Parliament on 14 February 2023 by Finance Minister Lawrence Wong.

The Buyer Stamp Duty table (BSD), as of 15 February 2023, are as follows:

On or after 15 February 2023
Purchase Price/ Market Value	BSD Rates for Residential Properties	BSD Rates for Commercial Properties
First $180,000	1%	1%
Next $180,000	2%	2%
Next $640,000	3%	3%
Next $500,000	4%	4%
Next $1,500,000	5%	5%
Above $3,000,000	6%	–

Before the buyer stamp duty rates were increased, indicated below are the BSD rates, before 15 February 2023:

Before 15 February 2023
Purchase Price/ Market Value	BSD Rate for Residential Properties	BSD Rate for Commercial Properties
First $180,000	1%	1%
Next $180,000	2%	2%
Subsequent $640,000	3%	3%
Remaining amount	4%	–

As you can see from the two tables above, the portion of a property’s value above $1.5 million and up to $3 million will now be taxed at 5% (up from 4% previously), while those more than $3 million are taxed at 6% (up from 4% previously).

For commercial or non-residential properties, the maximum BSD rate is now at 5% even for properties beyond $3 million compared to 3% previously.

Transitional Provision for Buyer’s Stamp Duty Rates

But what if you purchased a property recently or were in the later stages of the home-buying journey? In such cases, you may apply for transitional BSD remission. You will pay the previous BSD rates if you meet all the conditions below:

a) Option to Purchase (OTP) was granted by the sellers to potential buyers on or before 14 February 2023;

b) OTP is exercised on or before 7 March 2023, or within the OTP validity period, whichever is earlier; and

c) OTP has not been varied on or after 15 February 2023

This increase in stamp duty rates is why many Singaporeans have dipped into lower value commercial property investing instead

How to calculate buyer stamp duty for a private property and HDB?

Let us discuss a worked example to show how the buyer’s stamp duties are calculated.

Let’s say Adam bought a private condo at a market valuation of $3,500,550 and a purchase price of $3,200,550.

Since the valuation amount is higher than the purchase price, stamp duties will be calculated at $3,500,550:

Purchase Price/ Market Value	BSD Rate	Calculation
First $180,000	1%	0.01*$180,000 = $1,800
Next $180,000	2%	0.02*$180,000 = $3,600
Next $640,000	3%	0.03%*$640,000 = $19,200
Next $500,000	4%	0.04*$500,000 = $20,000
Next $1,500,000	5%	0.05*$1,500,000 = $75,000
Remaining $500,550	6%	0.06*$500,550 = $30,033
BSD Payable		= $149,633

Buyer Stamp Duty (BSD) calculation formula:

Purchase Price (PP) / Market Value (MV)	Formula for Quick BSD Calculation
For property < $1,000,000	[0.03 * (PP or MV)] – $5,400
For property > $1,000,000 but < $1,500,000	[0.04 * (PP or MV)] – $15,400
For property > $1,500,000 but < $3,000,000	[0.05 * (PP or MV)] – $30,400
For property > $3,000,000	[0.06 * (PP or MV)] – $60,400

Using the above simplified formula, the buyer stamp duties that Adam needs to pay would  be: ($3,500,550 * 6%) – $60,400 = $149,633

What is Additional Buyer’s Stamp Duty (ABSD)?

First introduced on 7 December 2011, the Additional Buyer’s Stamp Duty is another type of stamp duty tax paid above the buyer’s stamp duty on purchasing a second and subsequent residential property. Note that, unlike BSD, ABSD does not apply to commercial properties.

If you already own a property (whether it is owned fully, jointly, or partially) in Singapore, any new purchase of a residential property would be considered an additional residential property. The ABSD rate that applies to you also depends on your citizenship or residency status.

The ABSD rates were last revised on 27 April 2023 as part of the cooling measures to stabilise the residential property market in Singapore. Here are the current ABSD rates:

Residential Status	No. of Properties	ABSD Rate
Singapore Citizens (SCs)	1st property	0%
	2nd property	20%
	3rd and subsequent property	30%
Singapore Permanent Residents (SPRs)	1st property	5%
	2nd property	30%
	3rd and subsequent property	35%
Foreigners	Any property	60%

How to calculate additional buyer stamp duty (ABSD)?

Here’s a worked example of the ABSD calculation for a Singapore Citizen:

Let’s say you are a Singaporean Citizen (SC) looking to purchase your second residential property. The market value of the property is $2.1 million, while the purchase price (or seller’s price) is $2 million on 23 May 2023.

What ABSD tax are you expected to pay in this case?

Since ABSD is calculated based on the higher price of your purchase price or market valuation, so in this case, it will be calculated on the market value. The ABSD rate levied on SC buying their second property is 20%, therefore, the ABSD amount payable would be $2,100,000*20% = $420,000.

Another worked example of the ABSD calculation for a foreigner in Singapore:

If you are a foreigner buying your first residential home at a market value of $4 million and the purchase price being $3.85 million on 5 June 2023.

What would be the ABSD tax you will have to pay?

Since the market value is higher than the property’s purchase price and ABSD levied on foreigners buying any residential property is 60%, ABSD would be $4,000,000*60% = $2,400,000.

Additional Buyer Stamp Duty (ABSD) calculation formula:

Purchase Price (PP) or Market Value (MV) x Respective ABSD rate

I am buying a new property but selling my existing one, do I still need to pay ABSD?

Important note: ABSD will apply if you exercise the option to purchase (OTP) to buy a property before the OTP for your selling property is exercised by your buyer.

Therefore, do ensure that you have a firm check on the timelines of your contra (buying and selling) transaction to avoid any heavy stamp duty payments. You can ask your property agent or a mortgage broker for advice for your planning purposes.

However, if you are a married couple, you can apply for ABSD remission if you sell your previous property within six months of purchasing your new home.

Remember that you must initially pay the ABSD within 14 days of the purchase. Therefore, do ensure you have sufficient funds in your CPF OA account or cash in hand.

How to avoid paying ABSD for a second home

A common method to not have to avoid paying ABSD when buying a second property is to go through a decoupling or a part purchase. When decoupling — transferring your share of a property to another co-owner — the BSD is payable on the share transferred.

For example, say you own 50% of a property, and your wife owns the other 50%. If your wife decides to transfer (sell) her share of the property to you, the BSD will be payable on the 50%. This means half the property price or valuation, whichever is higher.

For this reason, homeowners planning to decouple later (to buy a second property) would often allocate shares in their property as 99 -1 with a tenancy in common. That is, 99% to one owner and 1% to the other. This way, BSD is only paid on the one per cent being transferred when decoupling.

When to pay for stamp duty in Singapore and can I use CPF?

Property buyers who have incurred BSD, ABSD or both must follow the below guidelines:

If the Sales & Purchase (S&P) Agreement is signed in Singapore, the stamp duty must be paid within 14 days from the date of execution of the S&P or Option to Purchase.

If the S&P is signed overseas, you can pay it within 30 days of receiving the S&P Agreement in Singapore.

Yes, you can use CPF to pay for property stamp duties in Singapore

You can use your CPF funds available in your OA account to pay for both buyer stamp duties (BSD) and additional buyer stamp duties (ABSD).

As the process of seeking approval and the release of funds from CPF board towards payment of your stamp duties takes around 3 weeks, do take note of the following:

If you are buying a resale property (either private or HDB) – Stamp duties will have to be paid in cash first and then reimbursed back to you in the form of a cashier’s order by CPF board.

If you are buying a property under construction (BTO or new launch condo) – You can pay for stamp duties directly via CPF and no reimbursement is required.

Consequences of late payment of BSD and ABSD

If the buyer’s stamp duty is not paid on time, then a demand note is issued as a reminder associated with the penalty incurred for not paying on time.

1. If the tax is not paid for up to three months, then $10 or an amount equivalent to BSD, whichever is higher, is imposed.
2. If the tax is not paid for even after three months, then $25 or equivalent to four times the BSD payable, whichever is higher.

The Inland Revenue Authority of Singapore (IRAS) may recover the amount from the bank, lawyer on owner’s behalf and may even take legal action against them to recover the outstanding amount.

What is Seller Stamp Duty (SSD) in Singapore?

The seller stamp duty (SSD) was introduced to prevent flipping the purchase and almost immediate resale of property at a higher price, which results in inflated prices. As such, the SSD only applies if you sell within the first three years of a property purchase.

SSD is based on the higher of the property price or value at the time of sale. It applies to both residential and commercial properties, and is payable within two weeks of completing the sale.

Here are the SSD rates for property purchased on or after 11 March 2017:

On or after 11 March 2017
Holding Period	Seller’s Stamp Duty (SSD) Rate
Up to 1 year	12%
More than 1 year and up to 2 years	8%
More than 2 years and up to 3 years	4%
More than 3 years	No SSD payable

The above table shows that the SSD can go up to 12% of either the purchase price or its market value, whichever is higher.

How to calculate seller stamp duty (SSD)?

Worked example:
Jaden purchased his residential property on 5th June 2017 and sold it on 20th June 2018 at a price of $4,180,000 .

Since the property was held for more than a year but lesser than 2 years, a seller stamp duty rate of 8% applies: SSD = $4,180,000*8%= $334,400

Seller Stamp Duty (SSD) calculation formula:

Property Sold Price x Respective SSD rate

Exemptions from SSD

Under some instances, sellers may be exempted from paying the SSD even if sold during the holding period.

• When selling residential properties, public authorities like HDB and JTC need not pay SSD while exercising their duties.
• When the property has been acquired by the government under the Land Acquisition Act, the owners of residential property need not pay SSD.
• When individuals are adjudged bankrupt and required to dispose of their residential property, SSD is exempted.
• While disposing of their residential property upon involuntary winding up, companies need not pay SSD.
• Foreigners can exempt themselves from paying SSD if they have to sell their residential property under the Residential Properties Act.
• HDB flat sellers or transferors who bought their flats on or after 30 August 2010 and have been identified for Selective En-bloc Redevelopment Scheme (SERS) can exempt themselves from SSD.
• HDB flat sellers or transferors who return their flats to HDB due to repossession need not pay SSD.
• An HDB owner who marries another HDB owner can be exempted from paying SSD if one of them has let go of their respective HDB flat.

Be aware that SSD is payable during an en-bloc / collective sale (apart from SERS)

If you have purchased a private property, such as a condominium, and it was put up for an en-bloc within three years of the purchase, you are still liable to pay the SSD.

This is regardless of whether or not you agreed to the en-bloc. If paying the SSD would cause you a financial loss in this situation (as you would make less from the sale than you originally paid for the unit), you can represent your case to the Strata Titles Board.

But I have definitely heard of investors reselling properties without paying the SSD. What gives?

What you heard about was probably the transfer of the Option to Purchase (OTP). For a brief time, it was possible to add the names of subsequent buyers on the OTP and then transfer the OTP (but not the house, thus evading stamp duties on the resale). That loophole has since been closed, and any information lingering about this is now obsolete.

Finally, there is GST payable on commercial properties, for commercial properties, you do have to pay the usual GST. At the time of writing, this is set at 8% of the higher of the purchase price or valuation.

Still confused or worried about stamp duties?
A mortgage broker doesn’t just show you the best home loan rates offered by major banks in Singapore for your housing loan. They’re also familiar with the property market, specific rules and regulations and can advise you further for your new property purchase. If you have any inquiries regarding your property purchase, please reach out to us! Our DollarBack Mortgage consultants will be more than happy to assist you.