When buying property in Singapore, one important upfront cost to prepare for is Buyer’s Stamp Duty, or BSD.
BSD is a tax paid by the buyer when purchasing or acquiring a property. It applies to residential properties such as HDB flats, condominiums and landed homes, and is calculated based on the higher of the property’s purchase price or market value.
What Are the Current BSD Rates for Residential Property?
For residential properties, BSD is calculated progressively. This means different portions of the property value are taxed at different rates.
The current BSD rates for residential property are:
How Is BSD Calculated?
For example, if you buy a residential property for $1,200,000, the BSD is calculated in tiers:
What Is Additional Buyer’s Stamp Duty?
Additional Buyer’s Stamp Duty, or ABSD, is an extra stamp duty that some buyers need to pay on top of BSD when buying residential property in Singapore.
Whether ABSD applies depends on the buyer’s residency status and property ownership profile. For example, Singapore Citizens buying their first residential property do not need to pay ABSD. However, Singapore Citizens buying their second or subsequent residential property, Permanent Residents, foreigners, and entities may need to pay ABSD.
In simple terms, BSD applies to all property buyers, while ABSD only applies to certain buyers depending on who they are and how many residential properties they already own.
Why BSD Matters for Buyers
BSD can add a significant amount to the upfront cost of buying a property. Buyers should not only look at the selling price, but also consider stamp duties, legal fees, loan requirements, renovation costs, and other expenses.
This is especially important when comparing different properties. A higher purchase price does not only mean a higher mortgage; it may also mean a higher BSD amount.
Check the Property Value Before You Buy
Before committing to a purchase, buyers can use an online property valuation tool to get a better sense of whether the asking price is reasonable. Since BSD is based on the higher of the purchase price or market value, understanding the estimated value of a property can help buyers plan their budget more accurately.
Buyer’s Stamp Duty is an important cost every property buyer in Singapore should understand. By calculating BSD early and comparing property values carefully, buyers can make more informed and confident property decisions.
