New Property Tax Computation for Home Owners from January 2011

With the latest Budget released for 2010 by Financial Minister Tharman Shanmugaratnam, property tax computation for home owners will be on a 3-tier progressive scheme.

Based on Annual Value (AV) of your owner occupied home, the tiers are as follows:-

  1. 0% on your first $6,000 of AV
  2. 4% on the next $59,000 of AV
  3. 6% on anything above $65,000 of AV

There is already a new online calculator available based on the new tax tier on IRAS website for you to computate your 2011 property tax should you be able to know the latest AV of your home.

Rationale for New Property Tax Tier

Mr Tharman explains that with a moderately progressive property tax system, together with an income tax system that collects more taxes from better-off individuals and a flat GST rate that everyone pays, will form a fair system of taxes as a whole.

And with such, this tax system will benefit most Singaporeans.

IRAS – Tax Rebate and Defer Your Income Tax Payment

Every eligible Singapore tax payer should have a letter hitting their mailbox from our friend, the Inland Revenue Authority of Singapore (IRAS) on 2 things coming from the Singapore Budget’s Resilience Package.

One-off Income Tax Rebate

So everyone gets a 20% one-off income tax rebate or maximum of $2,000 for tax payable for 2009.

Defer Your Income Tax Payment

You could choose the option to delay your payment for 3 months using your SingPass. Note that you’ll also have to be paying your tax by GIRO to be eligible for the deferment.

Well, 6 month’s isn’t a bad thing (IRAS starts computing in 3 months and starts collecting the instalments 3 months later, making it 6 months in total) for people who might have cash flow problems in the meantime to sort out.

Signing Up

Head to

Look out for the big red button on the corner, it looks like this


Pump in your SingPass details and you’re done! Remember, the latest date to sign up for deferment is on the 15th of March 2009, so please don’t miss it :)

Sign up for IRAS Deferment
Sign up for IRAS Deferment

Sometimes it’s really impressive and scary to think of how the government keeping tabs on all its citizens with SingPass to all the government portals and statutory boards.

HDB Additional Housing Grant (AHG) Increase Firmed Up

The Additional Housing Grant (AHG) enhancement has been firmed up in Parliament by Minister of National Development Mr. Mah Bow Tan in his speech. The new AHG is as of the following new structure:-

The New HDB AHG for 6th February 2009 after Budget Day
The New HDB AHG for 6th February 2009 after Budget Day

As mentioned in my previous Singapore Budget blog entry, each level notch gets the upgrade of the old AHG with the correct estimation. The goodies are:-

  • Income ceiling has increased from $4,000 to $5,000, meaning more people will be eligible for AHG.
  • Maximum grant quantum has been increased from $30,000 to $40,000.
  • More people will benefit from a reduction of 2 years continuous employment to 1 year.

AHG can be used for sale of new flat/ DBSS as well as resale flats as of last time with no changes on this aspect.

Singapore Budget 2009 – What It Means To Us

Finance Minister Tharman Shanmugaratnam unveiled the Budget for the fiscal year 2009 two days ago at 3.30pm; Among are the highlights of it’s 20.5 billion dollar Resilience package.

Here’re the highlights and perks for the property segment:

Bigger HDB Grants for Buyers

Additional Housing Grant (AHG) has been raised from $30,000 to $40,000. And more new families will definitely qualify for AHG since the income ceiling has been raised from previously $4,000 to $5,000.

This is the government way of letting us know that ahead of tough times, they still want people to own their own HDB flats to start a family, though I wish that they could raise the income ceiling higher for AHG. Any families that earns $5,000 or lesser could get the grant, but that doesn’t mean a new family would be able to enjoy the full grant of $40,000 as AHG is being tiered to your income. The higher your income that qualifies you in the criterion, the lesser you get.

A typical $4,900 income family would probably get $5,000.00 in the new AHG grant (my estimation)

The current AHG grant is still not being updated with the new stats, but can be found here in HDB’s website.

40% Property Tax Rebates for Industrial and Commercial Properties

Nada for residential. The government hopes that some of these savings will be passed down from landlords to tenants to sustain businesses. We’ll see rounds of negotiations coughing up on rental after this budget I’m sure.

The sad part is for residential property investors; No savings.

15% Rental Rebate For Government Tenants

This is a strong sign that governments are trying to save as much businesses as they can to sustain jobs. Government boards tenants from National Environment Agency (NEA), Housing Development Board (HDB), JTC Corporation and Singapore Land Authority (SLA) tenants will get the rebates. Yes, hawker stalls too!

HDB has already put up press releases on the rental rebates of 15% to their existing commercial tenants. Again, I’m not sure whether they did enough since the price on rentals and properties has inflated drastically in 2006/2007.

Allowing One Year Of Project Completion Period For Developers

To assist property developers during this slowdown, the government is allowing Developers with Qualifying Certificate (QC) to delay their project completion, by allowing more flexibility for them to stage their construction and sales to the market condition, as well as easing their cashflow.

Usually, QC holders are allowed to hold their projects for 6 years and with the above mentioned measure, developers are allowed to write in to Controller of Residential Property (SLA).

Developers of uncompleted Government residential projects awarded before 22 January 2009 will be allowed to apply for extention of Project Completion without extention premium.

Developers are allowed to re-assign of Government sale sites and private land

Should the re-assignments be not of speculative nature, the Government will be allowing it on case to case basis. Developers who wish to re-assign their land will have to have a written approval from Controller of Residential Property.

Four Years, Not Two From TOP To Dispose All Private Residential Properties/ And Allowing Developers to Rent Out Unsold Units for Maximum of 4 Years

The previous 2 years rule for QC holders to dispose their residential properties have been eased. Developers can now stage according to the market conditions and that would ease them in terms of their planning and execution of marketing plans. 4 years would be a fair duration given that the property cycle might pick up from 2011 – 2012.

Developers Can Pay Tax Later For Land Approved Sites

The Government is allowing developers to defer their property tax for up to 2 years. The sites must come with a valid Provisional Permission (PP) or Written Permission (WP) to qualify for such deferment.

Well we couldn’t say that there’s nothing done to aid our market, given that there’s alot of consideration in all sectors apart from the property segment.

We’ll see if it helps in curbing the credit crunch with the Resilience Package this year (especially after Chinese New Year).

Singapore Budget Announcement 2009 Tomorrow

Finance Minister Mr. Thaman Shanmugaratnam will be announcing Budget for fiscal year 2009 tomorrow at 3.30pm.  You can get the updates on the budget by: –

  • Mailing List
  • Channel News Asia
  • 93.8 Live Radio
  • By SMS

New media reaches more people eh? ;)

So what’s on top of your list for this Budget? 100% off property tax? Hmm ;) Visit Singapore Budget 2009 site for more information.

Singapore Real Estate News – Estate (Death) Duty Abolished

The long awaited budget day for 2008 was released today by the new Finance Minister Mr Tharman Shanmugaratnam. With 6.4 billion surplus in revenue at the closing of 2007, the parliament decides to reward citizens, giving rebates. For the important part of realtors (estate agents) and people who invests in real estate in Singapore, you might be interested to know that the estate duty tax has been abolished.

Previously, if you die and have assets of dwelling houses of more than 9 million dollars and CPF/ other tangible assets of more than $600,000, you’re liable for estate duty (death) tax before your properties are distributed to your family/heir.

For the every dollars of your 1st 12 million dollars, you’re previously liable for 5% tax and anything more than 12 million, it’s 10%. With this law abolished, it’s big savings to wealthy individuals.

This probably would attract more high net worth individuals and professionals to be a Permanent Resident in Singapore in the future.