Singapore has raised additional stamp duties for private residential home buyers: 60% for foreigners, 5% for permanent residents, and 0% for citizens.
On the night of April 27, 2023, Singapore unexpectedly doubled the additional stamp duty for foreign buyers of private residential properties, raising it from the previous 30% to a whopping 60%.
Note that when buying a property in Singapore, the main taxes involved include stamp duty (transaction stage), income tax (transaction stage), and property tax (holding stage), which constitute the three major tax categories.
Moreover, within the stamp duty category, it is divided into Additional Buyer’s Stamp Duty (ABSD) and Buyer’s Stamp Duty (BSD). Furthermore, the tax rates for these two types are not fixed; they vary based on individual circumstances and are assessed based on the property value.
For Example：
If a foreigner intends to purchase a property worth 1.5 million Singapore dollars in Singapore, then:
- Buyer Stamp Duty to be paid：SGD44,600
- Additional Buyer Stamp Duty to be paid：SGD900,000
Singapore Property Stamp Duty Rate Table
Singapore Additional Buyer’s Stamp Duty Rate Table
Upon the release of the new policy, the Singapore Ministry of National Development, Ministry of Finance, and the Monetary Authority of Singapore jointly issued a statement, indicating that the government’s action is aimed at proactively regulating investment demand, fostering a sustainable real estate market, and giving priority to the demand for owner-occupied residences.
However, there are various interpretations circulating in the public domain:
Some people say that the Singapore government is using this as a tool to identify super-rich individuals;
Others believe that this is the Singaporean government’s strategy to hedge against the increasingly bullish Singapore dollar and the risk of substantial currency depreciation caused by central banks worldwide expanding their balance sheets with high-quality assets.
Meanwhile, “Stigious” believes that this may be an unintentional but significant signal from the government – encouraging foreigners who are interested or have the capability to apply for Singapore Permanent Residency (PR) or even citizenship.
After all, Singapore has adjusted the Additional Buyer’s Stamp Duty (ABSD) more than once, and the specific figures for each adjustment seem to indicate certain considerations.
The Additional Buyer’s Stamp Duty in Singapore was officially introduced on December 8, 2011, and it has been adjusted four times since then.
Officially introduced Additional Buyer’s Stamp Duty (ABSD)
For foreign individuals/companies: An additional stamp duty of 10% must be paid on the purchase price or market value, whichever is higher.
For citizens: For the third and subsequent properties, an additional stamp duty of 3% is applicable.
PRs： For the second and subsequent properties, an additional stamp duty of 3% is applicable.
First Adjustment
For Foreigners： ABSD increased to 15%.
PRs： 5% for the first property；10% for the second and subsequent properties.
For Citizens：7% for the second property; 10% for the third and subsequent properties.
For entities (companies): ABSD increased from 10% to 15%.
Second Adjustment
For Foreigners： ABSD increased to 20%.
For Citizens： 12% for the second property; 15% for the third and subsequent properties.
PRs： 10-15% for the second and subsequent properties.
For entities (companies)： ABSD increased to 25%.
For developers：5% ABSD, payable upfront.
Third Adjustment
For Foreigners： ABSD increased to 30%.
For Citizens： 17% for the second property; 25% for the third and subsequent properties.
PRs：25% for the second property; 30% for the third and subsequent properties.
For entities (companies)： ABSD increased to 30％.
Fourth Adjustment
For Foreigners： ABSD increased to 60%。
For Citizens： 20% for the second property; 30% for the third and subsequent properties.
PRs：20% for the second property; 30% for the third and subsequent properties.
For entities and trustees: ABSD increased to 65% for the first property onwards.
From the above data, we can observe:
- For foreigners, the Additional Buyer’s Stamp Duty (ABSD) has increased from 10% since its introduction 12 years ago to the current 60%.
- For Singapore Permanent Residents (PRs), the ABSD has remained unchanged at 5% for the first property for the past 10 years, following the initial adjustment.
- Singaporean citizens continue to have a 0% ABSD for their first residential property
Indicating the government’s support for citizens and PRs in acquiring their first homes. This also suggests the importance of foreign individuals obtaining PR status early on.
How to Avoid Additional Buyer’s Stamp Duty (ABSD)?
The best way to avoid the increasingly high ABSD is to become a Singapore Permanent Resident (PR). The key distinction between PRs and foreigners is that PRs can pay significantly less in stamp duty for almost one-third of the properties. This not only allows for the purchase of high-quality properties with lower taxes but also grants PR status, enabling access to various benefits in Singapore. It’s a win-win situation.
One approach to becoming a PR is through the Global Investor Program (GIP).
This brings us to the concept of a family office.
The concept of a family office is highly flexible and essentially serves as an entity that provides services to High Net Worth (HNW) families. The primary function of a typical family office is to manage the assets of one or more high-net-worth families.
In Singapore, a single-family office can oversee applications for employment passes and based on the Global Investor Programme (GIP) managed by the Economic Development Board of Singapore, apply for permanent residency for high-net-worth family members.
On the 15th of last month, the Singapore government once again raised the investment immigration threshold to SGD 10 million! However, this has not dampened the enthusiasm of global wealthy individuals seeking Singapore citizenship.
Image Source：Lianhe Zaobao
The Global Investor Programme (GIP) is currently the only avenue in Singapore that allows individuals to obtain Permanent Residency (PR) in one step.
Eligibility Requirements
Path Two: Apply for PR Directly with an Existing EP/SP
If you are currently in Singapore holding an Employment Pass (EP) or S Pass (SP), you may be eligible to apply for Permanent Residency (PR) under certain conditions.
Of course, as everyone’s individual circumstances are different, and the Singapore government does not provide very specific PR admission criteria, friends in need can also contact us for an opportunity to undergo a free assessment.
Path Three: First Apply for an Employment Pass (EP)
Certainly, if you don’t possess the wealth of a global tycoon but have valuable skills, you can still prepare to become a Permanent Resident (PR) by first applying for a Singapore EP.
However, starting from September this year, the EP application process in Singapore will officially implement a scoring system. The government has provided clear details about the scoring criteria, and for more information, you can refer to the fourth article today titled “In September, Singapore EP Applications to Adopt Scoring System! Certain Individuals Can Meet Requirements Solely through Extra Points!
Image Source: Lianhe Zaobao
Path Four: Self-Employed Immigration to Obtain an EP
The Singapore Self-Employed Pass (Self-Employment Pass) program refers to a way for applicants to operate their own business or invest in an existing enterprise in Singapore. Subsequently, they can apply for an Employment Pass (EP) or Special Pass (SP) in the capacity of a director or executive of the enterprise. After holding the work pass and meeting certain requirements, applicants can then apply to the Immigration and Checkpoints Authority of Singapore for Permanent Residency (PR).
The Singapore Self-Employed Pass program is currently the preferred immigration option for those who cannot reside in Singapore for an extended period, do not have the energy to run a business themselves but have sufficient funds for investment. The process takes 2-4 months for landing, and it allows the primary applicant to bring their entire family (parents, spouse, and unmarried children under 21 years old).
If you don’t have a particularly promising project yourself and there’s no need to rush, “Adepture” has many high-quality projects available for investment and equity participation, making it possible to achieve self-employed immigration and obtain an Employment Pass (EP).
Today, Singapore has entered a golden decade in wealth management, and global investment has become a standard practice for wealthy individuals worldwide.
To preserve and grow assets, it is essential to comprehensively evaluate and plan one’s identity and investment approach for oneself and family. Despite being a small nation, Singapore possesses remarkable resilience, pioneering spirit, and competitiveness. Particularly noteworthy is the integrity and efficiency of the government authorities, making it a global leader.
If you are considering relocating to Singapore, expanding your business into Singapore, or have valuable skills that can shine in Singapore, then quickly contact us to learn how to apply for Singapore Permanent Residency (PR) and Employment Pass (EP)!
