In the competitive property market of Singapore, potential buyers are always seeking savvy ways to how to buy second property in Singapore without ABSD. Understanding the nuances of avoiding ABSD Singapore can save a significant amount of money. This guide delves into strategies and insights on how to avoid ABSD when purchasing a second property in Singapore.
What is ABSD?
The Additional Buyer’s Stamp Duty (ABSD) is a tax imposed by the Singapore government to moderate property market demand. It applies to various categories of buyers when purchasing residential properties.
Strategies for Avoiding ABSD
There are several legal methods to avoid ABSD Singapore. Here are some effective strategies:
- Decoupling Method: This involves transferring ownership of the first property to one party, allowing the other party to purchase a second property without being liable to ABSD.
- Buying Under a Different Name: Register the second property under a different family member’s name who does not own any property, such as a child or spouse.
- Purchasing a Commercial Property: ABSD is only applicable to residential properties, so buying a commercial or industrial property can bypass this tax.
- Subsidized Housing: Investing in executive condominiums (ECs) or other subsidized housing schemes can be another way to mitigate ABSD, as these have different tax implications.
Detailed Steps to Decouple Property Ownership
Decoupling involves one spouse selling his or her share of the property to the other. Here’s how it works:
- Determine the Property’s Current Market Value.
- Calculate the Stamp Duty and Legal Fees for the Transfer.
- Proceed with the Transfer Process and Update the Ownership Records.
Read more about How to avoid ABSD here.
FAQs on Avoiding ABSD Singapore
What happens if I fail to pay ABSD?
Penalties for non-payment of ABSD can include hefty fines and legal action, so it’s crucial to comply with regulations.
Is it legal to avoid ABSD?
Yes, as long as the methods used are within the legal framework set by the Singapore government. Always consult a legal advisor before proceeding.
Can foreigners avoid ABSD?
Foreign buyers generally face stricter ABSD rates. However, investing through a company or purchasing commercial property may offer alternatives.
Is ABSD applicable to Permanent Residents in Singapore?
Yes, Permanent Residents (PRs) in Singapore are subject to ABSD, though at different rates compared to foreign buyers.
Conclusion
Understanding how to avoid ABSD when buying a second property in Singapore is crucial for any real estate investor. By leveraging strategies like decoupling, buying under a different name, or considering commercial properties, significant savings can be achieved. Nonetheless, it’s always advisable to seek professional guidance to navigate this complex landscape.