If you’re considering buying property in Singapore, it’s important to understand the Additional Buyer’s Stamp Duty (ABSD) tax and how it may impact your investment.
This tax, which was first introduced in 2011 and has undergone several changes over the years, is designed to regulate demand in the property market and discourage property speculation.
The ABSD declaration form can be found here. All buyers and transferees have to comply and complete the form and to be witnesses by their lawyers, if applicable.
The form should be kept for at least 5 years from the date of purchase/acquisition of the property.
Do note that property buyers are required to pay ABSD on top of the existing Buyer’s Stamp Duty (BSD).
As a property buyer or investor in Singapore, understanding ABSD tax statistics is crucial.
Not only can it help you make informed decisions about your property investment strategies, but it can also help you avoid costly mistakes.
In this blog post, we’ve compiled 9 ABSD tax statistics in Singapore that you need to know.
From the latest ABSD tax collection data to the impact of ABSD tax on the property market, we’ll cover a range of important statistics that every property buyer and investor should be aware of.
Whether you’re a Singapore resident or a foreigner looking to invest in the Singapore property market, this blog post will provide you with valuable insights and analysis of the ABSD tax and its impact on property investment.
So, let’s dive in and explore the 9 ABSD tax statistics you need to know.
9 ABSD Tax Statistics in Singapore you need to know (Updated in 2023)
- Foreigners’ ABSD Rate will increase from 30% to 60%
- Singaporeans buying Second Property will have to pay 20%, an increase from 17%
- Singaporeans buying Third Property will have to pay 30%, an increase from 25%
- Increases will affect around 10% of residential property transactions
- Singaporeans buying their 1st Residential Property will pay 0%
- Business Companies and Entities buying any residential property will pay 65%, an increase from 35%
- In 2011, the ABSD rate for Singaporeans buying a 2nd property was just 3%
- In 2011, the ABSD rate for Singaporeans buying a 3rd property and subsequent properties was just 3%
- In 2011, the ABSD rate for Foreigners and Corporate Entities was just 10%
1. Foreigners’ ABSD Rate will increase from 30% to 60%
The increase in ABSD rates for foreigners from 30% to 60% will have a significant impact on the Singapore property market. This increase is part of the government’s efforts to manage demand and prevent excessive speculation in the property market. By increasing the ABSD rates, the government hopes to discourage foreigners from investing in Singapore properties as a means of speculative investment.
2. Singaporeans buying Second Property will have to pay 20%, an increase from 17%
The increase in ABSD rates from 17% to 20% for Singaporeans buying a second property is part of the government’s efforts to manage demand in the property market and prevent excessive speculation. By increasing the ABSD rates, the government hopes to discourage Singaporeans from buying multiple properties as a means of speculative investment.
3. Singaporeans buying Third Property will have to pay 30%, an increase from 25%
This 30% is the same rate previously paid by Permanent Residents buying their 3rd and subsequent properties and foreigners buying their 1st property and onwards. This means Singaporeans investing and speculating heavily will now join the ranks of the PRs and Foreigners buying properties previously, in terms of the ABSD rates.
4. Increases will affect around 10% of residential property transactions
Based on 2022 data, this increase in ABSD will affect 10% of the residential properties. This means that just a small group of properties are being brought for investing and speculative purposes. The rest (90%) are made up of Singaporeans and PRs buying their first residential property.
5. Singaporeans buying their 1st Residential Property will pay 0%
Hooray, the new ABSD rate changes do not affect Singaporeans buying their 1st residential property. It is clear that the Government of Singapore is still keen on making sure all Singaporeans have a roof over their heads.
6. Business Companies and Entities buying any residential property will pay 65%, an increase from 35%
Business Companies and Entities buying any residential property will pay 65%, the highest ABSD rate of all the rates. Do note that these entities are those that have no intention of undertaking housing development of the subject property acquired, at the point of purchase. The Government clearly is trying to reduce the investment and speculative approaches and to focus Singapore’s housing policy on living and building a family for Singaporeans and PRs.
7. In 2011, the ABSD rate for Singaporeans buying a 2nd property was just 3%
We have come a long way from the 1st iteration of ABSD way back in 2011. In that year, from December 2011, the first ABSD for Singaporeans is just a mere 3%, a low amount as compared to the 20% that will be charged from 27 April 2023 onwards. It is interesting how much things have evolved in these past 12 years.
8. In 2011, the ABSD rate for Singaporeans buying a 3rd property and subsequent properties was just 3%
Now, it is 30%. A ten-fold increase. A huge leap to curb investment and speculation in favor of residential needs.
9. In 2011, the ABSD rate for Foreigners and Corporate Entities was just 10%
Now, for foreigners, the ABSD has got up to 60% and for Entities, it has gone up to 65%. A huge steep increase in these 12 years to stem the inflow of investment property speculators and foreign buyers.
ABSD Transitional Remission
A transitional provision will be implemented for cases meeting specific criteria, where ABSD rates applicable before 27 April 2023 will continue to apply. These conditions include the granting of an option to purchase (OTP) by sellers to potential buyers on or before 26 April 2023, with the OTP being exercised on or before 17 May 2023, or within its validity period, whichever is earlier, and no variation to the OTP being made, including any extension of its validity period, on or after 27 April 2023. It is important to note that the deadlines for the ABSD transitional remission rules will not be extended, even if the validity period of the OTP extends beyond or commences after 17 May 2023. Failure to meet any of these conditions will result in the ABSD remission not being granted.
Conclusion
Understanding the Additional Buyer’s Stamp Duty (ABSD) tax and its various statistics is essential for anyone looking to invest in the Singapore property market.
With the help of the 10 ABSD tax statistics we’ve covered in this blog post, you can make more informed decisions about your property investment strategies and avoid costly mistakes.
From the ABSD tax rates for different buyer profiles and property types to changes in ABSD tax rates over time, we’ve provided a comprehensive overview of some of the most important ABSD tax statistics in Singapore.
By analyzing these statistics and their impact on the property market, we hope that you now have a better understanding of how the ABSD tax works and how it may affect your property investment plans.
As the Singapore property market continues to evolve, it’s important to stay informed about updates and changes to the ABSD tax.
By keeping up-to-date with the latest ABSD tax statistics and news, you can make more informed decisions and stay ahead of the curve.
So, whether you’re a Singapore resident, foreigner, or property investor, we hope that this blog post has been informative and helpful in your journey toward a successful property investment.
Don’t forget to keep these ABSD tax statistics in mind as you navigate the Singapore property market, and remember to always consult with a professional before making any major investment decisions.
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