Stamp duty is a tax on documents that are related to the purchase or lease of a property. In Singapore, in addition to the monthly rent and security deposit, a tenant is required to pay a tax upon signing the tenancy agreement. The rental stamp duty is payable when a tenant:
- Rents the entire property or part of a residential property (e.g. room rental)
- Agrees to renew or extend the lease renting of entire apartments and rooms
Who pays for the rental stamp duty?
The tenancy agreement would usually state who is liable for the rental stamp duty, but it’s usually the tenant. If it’s not stated in the rental agreement, the tenant will have to pay for it, as specified in the Third Schedule of the Stamp Duties Act.
The tenant may also request their agent (if applicable) to assist with this if they are unfamiliar with the process.
How much stamp duty for rental are you supposed to pay?
The amount of stamp duty is dependent on the monthly rent, as well as the duration of your lease period. This table summarises the rental stamp duty rates:
| Average Annual Rent (AAR) | Rental stamp duty rates |
| AAR does not exceed S$1,000 | Exempted |
| AAR exceeds S$1,000 | |
| Lease period is 4 years or less | 0.4% of total rent for the lease period |
| Lease period is more than 4 years, or for any indefinite term | 0.4% of 4 times the AAR for the lease period |
The AAR refers to the higher of the average annual contractual or annualised market rent. It includes other payments such as
- Advertising and promotion charge
- Furniture/Fittings charge
- Maintenance charge
- Service charge
- Any other charges, excluding GST charges
Below is an example on the rental stamp duty calculation for an apartment with a total monthly rent of S$3,000, for a lease period of 18 and 24 months. Naturally, the higher the rent and the longer the period of stay, the higher the amount of stamp duty that is payable.
| Total monthly rent (including base rent, furniture, and others) | S$3,000 |
| Total rent over 24 months | S$3,000 ⨉ 24= S$72,000 |
| 0.4% of total rent for the period of the lease | S$72000 ⨉ 0.04% = S$288 |
| Payable rental stamp duty | = S$288 |
Here’s another example. If the lease period was 18 months instead of 24, the payable stamp duty would amount to S$216 as shown below.
| Total monthly rent (including base rent, furniture, and others) | S$3,000 |
| Total rent over 18 months | S$3,000 ⨉ 18= S$54,000 |
| 0.4% of total rent for the period of the lease | S$54,000 ⨉ 0.04% = S$216 |
| Payable rental stamp duty | = S$216 |
The lease duty is rounded down to the nearest dollar.
Alternatively, you can use this rental stamp duty calculator from the IRAS website.
When should the rental stamp duty be paid?
Technically, a tenancy agreement is required to be stamped before tenants sign it. However, for practicality, this almost always never happens. In reality, a tenancy agreement can still be stamped, with no penalty, if it is done within either of the following time frames:
- Within 14 days after signing the document if it is signed in Singapore or
- Within 30 days after receiving the document in Singapore if the document is signed overseas
Where can tenants get their tenancy agreement stamped?
If tenants choose to proceed with stamping of their documents themselves, they can do so at their own convenience via the IRAS e-Stamping portal. They may also choose to e-Stamp it at the e-kiosk at the Taxpayer & Business Centre at Revenue House.
Once payment has been made, you’ll receive a copy of the Stamp Certificate from the portal. For more information on how to use the e-Stamping portal, you can refer to this guide.
Alternatively, you can head down to one of these SingPost Service Bureaus to do it in person:
- Novena Post Office at Revenue House
- Raffles Post Office at Ocean Financial Centre
- Shenton Way Post Office at Downtown Galley
- Chinatown Post Office at People’s Park Centre
Penalties for late payment of the rental stamp duty
Actions can be taken by the authorities if you fail to pay the rental stamp duty on time.
For late payments not exceeding three months, a penalty of S$10 or an amount equal to the duty payable, whichever is greater, will be imposed.
For late payments exceeding three months, a penalty of S$25 or four times of the duty payable, whichever is greater, will be imposed.
For landlords, it is a common concern to wonder whether their tenants have paid their stamp duties on the tenancy agreement.
Fret not — there’s a way to find out if your tenant has paid the rental stamp duty. You can verify the Stamp Certificate through the e-Stamping portal by keying in the following:
- Document Reference Number
- Stamp Certificate Reference Number
How do you find the e-Stamping process? Let us know in the comments section below or on our Facebook post.
If you found this article helpful, 99.co recommends How renting can be a step for millennials to take before owning a home and A step-by-step guide to renting out your HDB flat.
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Frequently asked questions
Who pays the stamp duty for rental in Singapore?
It depends on which party is stated in the tenancy agreement, but it’s usually the tenant who pays for the rental stamp duty. If it’s not stated in the contract, the tenant will have to pay for it, according to the Third Schedule of the Stamp Duties Act.
How to calculate the stamp duty for rental?
For leases that are less than 4 years, the stamp duty is 0.4% of the total rent.
How to pay the stamp duty for rental in Singapore?
You can do it online via the e-Stamping portal or the e-kiosk at the Taxpayer & Business Service Centre at Revenue House. If you wish to do it in person, you can head down to one of the SingPost Service Bureaus at Novena, Raffles Place, Shenton Way or Chinatown.
The post What you need to know about stamp duty for rental units in Singapore appeared first on 99.co.
