4 More Scenarios for Additional Buyer Stamp Duty (ABSD)

Following up with the previous guide on ABSD and SSD, Dorothy Tay the principle solicitor for Legalworks has shared with us four more new scenarios which she has posed to IRAS. These are IRAS official answers.

SCENARIO 1

We have a client SC who has sold his HDB property. Option was issued and accepted but 1st appointment has not taken place and HDB’s approval for sale not obtained yet.

If he now buys another property before the 1st appointment and apart from the HDB, he does not own any other residential property, is ABSD payable? Is the issue of whether ABSD is payable dependent on the 1st appointment or a person is deemed to have sold his HDB once the option issued has been accepted.

IRAS REPLY

For the purpose of stamp duty, your client is considered to have sold the HDB flat, when the Buyer exercised his option to purchase. Upon the sale of the flat, your client is therefore not liable for ABSD on the purchase of the next residential property, as he is considered to be acquiring his first residential property.

SCENARIO 2

For a married couple both of whom are SPR, can they apply for a remission if this is there first property.

IRAS REPLY

ABSD may be remitted on the first residential property purchased by a married couple,
involving at least one Singapore Citizen spouse. There is no provision for remission when they are both Singapore Permanent Residents.

SCENARIO 3

If a person is a US citizen and also a SPR. Must he pay ABSD if he buys his first property. Can he choose to use his US citizenship so that he need not pay ABSD.

IRAS REPLY

A Singapore Permanent Resident, who is also a National of USA may apply for a remission of ABSD under the FTA agreement.

SCENARIO 4

If a husband owns a HDB flat and the wife is only listed as an essential occupier but she is not an owner; when the wife buy a property and it is her first property, is ABSD payable? Assuming both are Singapore Citizens.

IRAS REPLY

If wife is a Singapore Citizen, an occupier of a HDB flat, and does not own any residential property; she is not liable for ABSD on the first residential property that she purchases.

Dorothy and her legal team can be reached at +65 63251722 for any conveyancing advisory.

Additional Buyer Stamp (ABSD) & Seller Stamp Duty (SSD) Explained

Since the introduction of Seller’s Stamp Duty (SSD) on 22 February 2010 and Additional Buyer Stamp Duty (ABSD) on 7 December 2011, there have been a number of revisions in the rates as the cooling measures intensify throughout the years.

This is the latest rate. (you can find out about the latest ABSD and LTV adjustment here since 5th July 2018)

Seller’s Stamp Duty
• Holding period of 1 year : 16% of price or market value, whichever is higher
• Holding period of 2 years : 12% of price or market value, whichever is higher
• Holding period of 3 years : 8% of price or market value, whichever is higher
• Holding period of 4 years : 4% of price or market value, whichever is higher

Properties acquired before 20 Feb 2010 will not be subject to SSD.

Additional Buyer’s Stamp Duty

a) FR and *entities- 15% on the purchase or acquisition of any residential property.

b) SPR – 5% on the purchase or acquisition of their first residential property

SPR who already own# 1 or more residential properties 10% on the purchase or acquisition of another residential property.

c) SC – who already own# one residential property 7% on the purchase or acquisition of the second residential property.

– SC who already own# 2 or more residential properties 10% on the purchase or acquisition of another residential property.

# Whether owned wholly, partially or jointly with others.
* Entity means a person who is not an individual, and includes an unincorporated association, a trustee for a collective investment scheme when acting in that capacity, a trustee-manager for a business trust when acting in that capacity and, in a case where the property conveyed, transferred or assigned is to be held as partnership property, the partners of the partnership whether or not any of them is an individual.

I have invited Ms. Dorothy Tay of LegalWorks Law Corporation to answer some of my questions to clear up some confusing facts of how both of it works. Legalworks is a boutique law firm that specializes solely in conveyancing and has lawyers of more than 20 years experience in the field. Ms. Dorothy Tay is the principle solicitor behind Legal Works.

Additional Buyer Stamp Duty (ABSD)

Q: Many people are very confused for a fact for this mix of spouse. When you have a Singapore Citizen (SC) and a Foreign (FR) Spouse. How much Additional Buyer Stamp Duty you are supposed to pay for your first matrimonial house? Continue reading “Additional Buyer Stamp (ABSD) & Seller Stamp Duty (SSD) Explained” →

Legal Property Advice – Chances of Getting a Share of Property Proceeds after Divorce

Sunday Times is a weekly must read for me, especially with the columns that touches mostly on legal issues on real estate.

This week they’re covering issues with regards to divorce and how the judgement would be like when it comes to handling a property’s proceedings.

I am married, without any kids. My husband and I live in a condominium. His mother is a joint owner. He is paying for the home solely by himself, including the monthly housing loan and all other bills, while I am paying the monthly maintenance and conservancy fee of $300.

In the event of a divorce, do I have a chance of fighting for an equal share from the proceeds of the condominium?
A Normally a legal owner would have beneficial interest in the property. The beneficial interest acquired by the mother will be in proportion to her financial contribution. However, if the property was bought without any financial contribution from her, then it is arguable that she has no beneficial interest in the property.

An answer from Lie Chin Chin, Managing Director of Characterist LLC.

Upon a divorce, the court can order the division of the sale proceeds attributed to the share in the condominium that is the matrimonial asset.

For example, if the mother has a 30 per cent share, then only 70 per cent share in the condominium can be available for division between you and your husband.

The division will be in such proportions as the court thinks just and equitable, considering several factors such as length of marriage, and the parties’ direct and indirect financial contribution towards acquisition of the matrimonial property.

Indirect contributions could include efforts to enhance the welfare of the family, looking after the home or caring for the family or any aged or dependant of either party. The facts that you have no children and that your husband’s financial contribution is significantly more than yours are not factors in your favour.

Your contribution to the maintenance of the condominium is a factor in your favour. However, to have a higher chance of getting 50per cent of the matrimonial asset, you need to show there were extensive indirect contributions on your part.

Singapore Estate Law – Can You Will Your HDB to Siblings?

Here’s another interesting snippet from Sunday Times. Agent friends should flip up Sunday Times and look out for the Invest Section – Your Personal Adviser: Finance

Question:

I would like to know if I can make a will and name my siblings as beneficiaries so they can inherit my HDB flat when I die. I am single and registered as the sole owner of the flat. Two of my siblings already have their own HDB flats, while another has a private property.

If it is not possible to will the flat to them, what will happen to the property after my death? Would HDB buy back the flat and then distribute the funds to my estate, and would it pay the original price or the market rate?

Continue reading “Singapore Estate Law – Can You Will Your HDB to Siblings?” →

Singapore Estate Law – Can Foreigners Inherit Landed Property?

Sunday Times is always the best source for uncommon Singapore Real Estate laws. Here’s the snippet and answer:-

My boss is a Singaporean but she lives in Malaysia as she’s married to a Malaysian. She has a few landed properties in Singapore. In the event of her death, can her children and/or husband legally own the properties if willed, as they are not Singapore citizens or permanent residents (PRs)?

Professional answer coming from KhattarWong Partners, Lim Choi Ming,

In general, only Singaporeans are allowed to own land and landed properties in Singapore.

The following descriptions of land/landed property in Singapore are classified as restricted residential property:

Vacant residential land;

Landed property (that is, detached house, semi-detached house, terrace house including linked house or townhouse); and

Landed property in strata developments which are not approved condominium developments under the Planning Act.

Foreigners and PRs are allowed to own restricted residential properties only if they have obtained the prior approval of the Land Dealings Approval Unit (LDAU).

Your boss may will her landed property to her husband and/or children even if they are not PRs or Singaporeans. However, upon her death, a foreign beneficiary will have to obtain LDAU approval before he is eligible to legally own such landed property.

If the foreign beneficiary is not granted approval to acquire the landed property, the trustee of the estate of the deceased person will have to sell the foreign beneficiary’s share in the landed property within 10 years of the date of death of the deceased person.

If, for some reason, the trustee is unable to sell the property within the 10-year time limit, he will have to apply to LDAU for a time extension.

So if you have a landed property being passed down to you if you are a foreigner, you would have to dispose it should you decide not to reside in Singapore unless you have very special reasons that you could write to LDAU to allow you to own the house and at the same time reside in your home country.

At the very least, you could still wait and dispose your property at the right time since there’s no restriction on when you have to dispose the landed property within the 10 years timeframe.

Property Legal Woes – Seperated Spouse Unwilling to Sell House (HDB)

MY HUSBAND and I have been separated for a year. In the past, he has refused to pay for all household bills and refused to sell our HDB flat. He refused to do anything at all. What should I do if there is a buyer for the house and my husband refuses to sign the documents? What procedures can I take to make him sign?

Since I have been paying most of the household bills, can I fight for a bigger share of the sale proceeds from the house? As legal fees are very high, do you think it is worth doing that? Can I fight for alimony?

We have no children and I am earning slightly more than him. How much can I claim? If he does not pay for the alimony, what do I need to do? I am earning $2,500 monthly and have heavy financial commitments. Am I entitled to any government legal aid?

Answer from Lim Choi Meng, a lawyer from TM Hoon and Company

I ASSUME more than three years have passed since you got married, so you are now able to get a divorce.

I also assume that you are seeking a divorce and basing it either on grounds of adultery or unreasonable behaviour.

A year’s separation is not sufficient to get a divorce on those grounds, though. A minimum of three years (with his agreement) or four years of separation is required.

If the flat is sold pursuant to a court order made under the divorce, a time limit for selling it is usually stated.

In any event, the HDB will not allow a divorced couple to hold on to a flat jointly.

If a prospective sale fails because your husband unreasonably refuses to sign his agreement to the sale, it is possible for you to get an order in which the court is empowered to sign on your husband’s behalf.

On your question of your husband seeking a buyer, both of you have an equal right to sell the flat.

You can jointly appoint a housing agent, or else, if the court order specifies what price level the flat shall be sold at, the first spouse to get a successful buyer gets to sell the flat.

Your paying the house bills does not entitle you automatically to a greater share of the flat. This is an ‘indirect contribution’.

The first benchmark for arriving at the percentage of division is your respective direct contribution to the purchase price of the flat.

In deciding how much each party’s indirect contributions are, the court will look at factors such as who has been paying the household bills, and caring for the family and home.

Whether it is worth fighting the case in court depends on how much the profit on the flat is.

If there is a net profit of, say, only $10,000 which is to be shared between both of you, it makes no sense to go to trial to fight for an additional $1,000 or $2,000, as the money will easily be used up for your legal fees.

On alimony, the law provides an avenue for a wife to claim maintenance from her husband.

The amount depends on many factors such as the length of the marriage, the financial circumstances of the parties, their lifestyle, and whether there are children.

If you have been married less than five years with no children, chances are the maintenance that you will get will not be significant.

The court is likely to give you a lump sum (represented by a larger share of the net profit of the flat) rather than continuing maintenance.

If there is a court order for maintenance and he does not pay, you can enforce the court order yourself at the Family Court (Maintenance Section) in person – that is, without hiring a lawyer.

On your last question, your income is above the ceiling to qualify for legal aid.

Property Legal Woes – Financial Risk of Singaporean Divorcing Foreign Spouse

Found this article online and I think this is something that we should archive and share, maybe we should get a legal panel for advice as well on properties when it comes to relationship encumbrance.

Question

I AM MARRIED to a foreigner and we have a two-year-old child. After living abroad, I am now back in Singapore because our marriage is on the rocks.
My husband has a girlfriend and intends to file for divorce.

I have not been working since I married and moved overseas.

We own a property in Singapore which was bought solely under my name with my husband as the guarantor. Does that mean the house cannot be sold without my consent and that my husband, as the guarantor, has no alternative but to continue to service the loan?

Does he have the right to call for a sale of the house once he files for divorce?

Does he have the right to ask for a share of the sales proceeds since he has been the one servicing the loan from the start?

In addition, he bought shares and bonds under my name. Can I assume there is no dispute on the ownership?

As for child custody, how should I fight for it?

Answer from Justin Wee, a Solicitor from Loke & Seah Advocates & Solicitors

ASSUMING that the loan is secured on a mortgage of the property, there will be obligations on both your husband who is the guarantor and yourself as mortgagor to service the loan.

If your husband ceases repayment of the loan, the lender may look to you for repayment even though your husband has been servicing the loan since day one.
As your husband is not a registered proprietor of the property, he cannot unilaterally sell or otherwise dispose of the property without your consent.
Depending on the circumstances, if the property is considered a gift from your husband to you, he may not be able to ask for a monetary share when the property is sold.

In this regard, the law presumes there is a gift from the husband to the wife but this presumption may be rebutted by contrary evidence.

The same rebuttable presumption applies to assets like shares and bonds that are purchased in your name.

On the question of the custody of your child, the fact that you are not working does not mean that custody of the child will be given to your spouse as the court’s paramount consideration is the welfare of the child.

Moreover, there are provisions entitling you to obtain maintenance for yourself and your child.

As for fighting for custody of the child, it is best that you provide the full facts of your case to a lawyer as there needs to be a strategy put in place.

Depending on the circumstances, it can be a complex issue which cannot be fully dealt with in this space.