Seller Stamp Duties, Read This Before You Sell

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A Seller Stamp Duty, also called an SSD liability, is a tax that is levied by the Inland Revenue Authority of Singapore (IRAS) on property owners that sell their unit less than 4 years after purchasing it. You may wonder why this extra tax has been charged to property sellers who sell within a short period. The answer is that it was introduced to discourage or regulate the act of property flipping. Flipping is a practice whereby certain individuals buy a piece of property when it’s very cheap (usually when it’s first released for purchasing) and wait a few years for the property price to appreciate, then sell the property for profit.

Property flipping does have an adverse affect on the local property market, as it drives up property prices, making it unaffordable for genuine house buyers (especially first time house buyers) and commercial property purchasers who actually want to occupy the unit. Property Investors should know about the Additional Buyer Stamp Duties (ABSD) and Total Debt Servicing Ratio (TDSR).


These are some of the basics you should know about SSD liability:

  • The SSD liability is effective on residential property purchased on or after 20th February 2010 and industrial property bought on or after 12th January 2013.
  • The rate of the SSD on both residential and industrial properties depends on several factors, most notably, when the property was bought and how soon it was sold. The sooner one sells it, the higher the SSD that has to be paid. For example, residential properties bought on or after January 14th 2011 and sold within 1 year or less is subjected to an SSD of 16% on its selling price. However if the house is sold from 3-4 years after purchase, the SSD rate is only 4%.
  • If the property comes with some land, then the SSD of the land is decided by zoning defined in the Master Plan.
  • All SSD payable is rounded down to the nearest dollar.
  • Some exemptions to the SSD include disposal of properties by public authorities, compulsory acquisition of properties under the Land Acquisition Act, re-possession of properties and other actions by the authorities.
  • Residential property owners are exempt from paying the SSD if they’re disposing of their property due to bankruptcy or involuntary winding up.
  • Foreigners are also exempt from paying the SSD when they sell off their houses. However, Expatriates or foreigner has many other considerations when doing property investment in Singapore.
  • HDB flat owners won’t have to pay the SSD if they sell their units that have been chosen for the Selective Enbloc Redevelopment Scheme (SERS) before the government moves to claim it. HDB owners are also exempt from SSD if the authorities repossess their unit.

The rates for SSD are as shown below:

Date of Purchase or Date of Change of Zoning /  Use Holding PeriodSSD Rate (on the actual price or market value, whichever is higher)
Between 20 Feb 2010 and 29 Aug 2010 (all  inclusive)Up to 1 year 1% on first $180,000
2% on next $180,000
3% on remainder
More than 1  year No SSD payable
Between 30 Aug 2010 and 13 Jan 2011 (all  inclusive)Up to 1 year 1% on first $180,000
2% on next $180,000
3% on remainder
More than 1  year and up to 2  years 0.67% on first $180,000
1.33% on next $180,000
2% on remainder
More than 2 years and up to 3 years 0.33% on first $180,000
0.67% on next $180,000
1% on remainder
More than 3 yearsNo SSD payable
On and after 14 Jan 2011Up to 1 year 16%
More than 1 year and up to 2 years 12%
More than 2  years and up to 3  years 8%
More than 3  years and up to 4  years 4%
More than 4  years No SSD payable

 

SSD Rates for Residential Properties

Source: IRAS website

 

Date of Purchase / Acquisition or Date of Change of Zoning / UseHolding PeriodSSD Rate (on the actual price or market value, whichever is higher)
On or after 12 Jan 2013Up to 1 year15%
More than 1 year and up to 2 years10%
More than 2 years and up to 3 years5%
More than 3 yearsNo SSD payable

SSD Rates for Industrial Properties

Source: IRAS website

Hopefully this simple guide will allow you to understand a bit more about the SSD and why you have to pay them. Just keep in mind that there are other taxes and fees to cover when you sell your house, which is why keeping a ‘to do’ list is great when you need to sell off your house or industrial properties. Do find out more about property investment in Singapore for comprehensive information

2 Comments

  1. […] Singapore, it is essential that you are aware of TDSR, Additional Buyer Stamp Duties (ABSD) and Seller Stamp Duties (SSD). If you want to find out more about the complexities of the TDSR, do read […]

  2. […] Buyer Stamp Duty. Beside ABSD, it is important to understand Total Debt Servicing Ratio (TDSR) and Seller Stamp Duties (SSD) too. If you’re wondering what it is, here are the answers to your […]

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