Higher property taxes for Singapore homeowners as government raises residential annual values

RESIDENTIAL property owners in Singapore are poised to pay higher property taxes next year, with the annual values of both private and public housing rising in tandem with surging market rentals.

Annual values (AV) of most residential properties will be revised upwards from Jan 1, 2023, as part of the Inland Revenue Authority of Singapore’s (Iras) annual review of properties to calculate property tax payable.

Since AVs were last revised on Jan 1, 2022, Iras said market rentals of HDB flats and private residential properties rose by more than 20 per cent. The AVs of residential property will therefore be revised from Jan 1, 2023, to reflect this, it said. 

To mitigate the effect of higher AVs, all owner-occupied properties will receive a one-off property tax rebate capped at S$60 – equivalent to 60 per cent of the 2023 property tax bill, said the Ministry of Finance and Iras in a press statement on Friday (Dec 2). 

This means that the majority of HDB residents will pay between S$30 and S$70 more in property tax after rebate next year, compared with the property tax this year, they said. 

Owners of more expensive properties will see a larger tax bill, in line with revised tax rates announced in Budget 2022. Changes were made to put in place a more progressive structure, with higher value and non-owner-occupied residential properties being taxed at higher rates. Owner-occupiers of one- and two-room HDB flats continue to be exempted from paying property tax. 

Revenue from property taxes rose 49.3 per cent to S$4.67 billion in FY21, from a lower base of S$3.13 billion in FY20 when the government granted qualifying non-residential properties property tax rebate for the period of Jan 1, 2020 to Dec 31, 2020. Compared against the S$4.76 billion collected in FY19, it dipped 1.9 per cent in FY21. With both property tax rates and annual values being revised upwards, revenue from property tax looks set to grow further.

For next year, the owner of a five-room HDB flat would see their 2023 property tax payable increase by S$40.80 to S$52.80, to S$148 to S$196 after rebate – an almost 40 per cent increase at least. For three-room HDB flat owners, property tax payable in 2023 will go up by S$7.20 to S$30.40 in 2023, to S$20.80 to S$40 after rebate. An owner of a four-room HDB flat would have to pay an additional S$33.60 to S$45.60 in property tax next year, at S$107.20 to S$155.20. 

Meanwhile, the property tax for executive flats ranges from S$176.80 to S$224.80 after rebate next year, an increase of S$55.20 to S$67.20 from this year. 

Iras added that property owners who face financial difficulties may approach them for assistance to discuss a suitable payment plan before the end of next January, including appealing for a longer payment plan.