Chief Editor November 30 2023

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Government Introduces One-off Rebate to Mitigate Rising Property Taxes in 2024

As property taxes for both Housing Board (HDB) flats and private properties are set to increase in the coming year, the Singaporean government has unveiled a one-off rebate of up to 100 per cent. This move aims to alleviate the financial burden on affected property owners grappling with concerns over the escalating cost of living.

The Ministry of Finance (MOF) and the Inland Revenue Authority of Singapore (IRAS) disclosed that the rise in property taxes is attributed to the surge in market rents and annual values for most residential properties.

Tiered Rebate System:

The one-off rebate, applicable to all owner-occupied residential properties, will be implemented using a tiered system. This approach ensures that the property tax regime remains progressive, with those possessing greater means contributing their fair share of taxes, according to MOF and IRAS. This initiative follows a similar one in 2023 when the government provided a one-off 60 per cent rebate for all owner-occupied properties.

Property Tax Rebate for Owner Occupied Homes

PROPERTY TYPE ONE-OFF TAX REBATE
1 to 2-room flat 100%
3-room flat 70%
4-room flat 50%
5-room flat 40%
Executive EA 30%
Private Residential 15%
capped at $1,000

Changes in Annual Values:

The annual values of HDB flats and most private residential properties are slated to increase from January 1, 2024, reflecting the rise in market rents. This adjustment is based on a yearly review of properties' annual values, used to calculate the tax payable by property owners.

Property Tax Rate Increase:

The second and final step of the property tax rate increase, announced in Budget 2022, will also take effect in 2024. This will impact non-owner-occupied residential properties and owner-occupied residential properties with an annual value exceeding S$30,000. However, HDB flats occupied by their owners will remain unaffected, continuing to enjoy lower property tax rates than rented-out residential properties.

Non-Owner Occupier Taxes:

Annual Value (S$) From 2024
(%)
Property tax payable (S$)
2024
2023
(%)
Property tax payable (S$)
2023
First 30,000

12

12

3,600

11

11

3,300
Next 15,000

20

20

3,000

16

16

2,400
First 45,000   6,600   5,700
Next 15,000

28

28

4,200

21

21

3,150
First 60,000   10,800   8,850
Above 60,000

36

36

 

27

27

 

Impact on Property Owners:

With the rebate, owner-occupiers of one-room and two-room HDB flats will be exempt from paying property tax in 2024. For other HDB flat types, the rebate will automatically offset any property tax payable, resulting in an average tax increase of less than S$3 per month. Similarly, owner-occupiers of private properties will see the rebate automatically deducted from their property tax, with the bottom half experiencing an increase of less than S$15 per month.

Social Support and Annual Value Thresholds:

In response to the increase in property tax, the government announced a corresponding adjustment in the annual value thresholds used for social support schemes. This includes MediShield Life premium subsidies, aiming to ensure that Singaporeans with greater needs continue to receive support.

Tax Payment Reminders:

IRAS emphasized the importance of property owners paying their property tax for 2024 by January 31. Those facing financial difficulties can approach IRAS to discuss a suitable payment plan before the deadline. The "Apply for payment plan" e-service at myTax Portal allows property owners to appeal for an extended payment period through their Singpass accounts.

Failure to pay or arrange for payment via GIRO instalments by the due date may result in a 5 per cent penalty.

Comments from Propertyforsale Pte Ltd Managing Director, Mr Chia:

In light of the impending rise in property taxes, the government's proactive measure of introducing a one-off rebate demonstrates its commitment to supporting property owners amidst economic challenges. The tiered system ensures a fair distribution of the rebate, reflecting a progressive approach to property taxation.

As Singaporeans await their property tax bills at the end of December, it is crucial for property owners to be mindful of the payment deadline and explore available avenues for financial assistance if needed.