As an expatriate contemplating permanent residency in Singapore, you would likely encounter various challenges in securing long-term accommodation. Due to your status as a foreigner, you are restricted to private residential properties, as public housing is only available to Singaporeans and Permanent Residents (PRs).
However, in addition to forking extra money for more expensive housing, you also need to contend with a higher property tax. As a result, it is unsurprising to learn that this factor has influenced many expatriates’ decision to apply for Permanent Resident status.
Learn More: Singapore Permanent Resident: What Are Your Residential Options?
Property Tax as a Key Consideration for Becoming a Singapore PR
When purchasing a residential property in Singapore, homeowners are obligated to pay a Buyer’s Stamp Duty (BSD) to the Inland Revenue Authority of Singapore (IRAS). However, as a foreigner, you will face an Additional Buyer’s Stamp Duty (ABSD). This levy was introduced in 2011 as part of the government’s cooling measures to curb the influx of foreign investors and prevent unnecessary inflation of the property market in Singapore.
Here is the latest BSD rate as of 2023:
| Purchase Price/Market Value | Rate for Residential Properties | Rate for Non-residential Properties |
| First S$180,000 | 1% | 1% |
| Next S$180,000 | 2% | 2% |
| Next S$640,000 | 3% | 3% |
| Next S$500,000 | 4% | 4% |
| Next S$1,500,000 | 5% | 5% |
| Amount exceeding S$3,000,000 | 6% | 5% |
Now, let us examine the ABSD rate and compare how much more you have to pay in property tax compared to a Singaporean or Singapore PR.
| Nationality/PR Status | ABSD RatePercentage paid (of your property price or valuation, whichever is higher) |
| Singapore Citizens purchasing their first residential property | 0% |
| Singapore Citizens purchasing their second residential property | 20% |
| Singapore Citizens purchasing their third and subsequent residential property | 30% |
| Permanent Residents purchasing their first residential property | 5% |
| Permanent Residents purchasing their second residential property | 30% |
| Permanent Residents purchasing their third and subsequent residential property | 35% |
| Foreigner | 60% |
As you can see, you will incur the maximum ABSD levy immediately for purchasing a residential property in Singapore as a foreigner. That is a 55% difference compared to a Singapore PR buying their first home!
Tax Advantages for Permanent Residents
As a Singapore PR, you can potentially mitigate the extraordinary ABSD rate levied on foreigners, which makes property acquisitions more costly. So, if you have a vested interest in Singapore’s property market, this is an added incentive to apply for PR. By securing your PR status, you can benefit from the stability and potential capital appreciation offered by the local real estate sector.
Besides, applying for Singapore PR also signifies your commitment to the nation, reflecting your desire for stability, integration, and a sense of belonging. So why not consider a PR application if you already have plans to stay in Singapore for the long term? Consider the tax benefit and potential for long-term financial gains as additional bonuses for those seeking to establish themselves permanently in the country.
Take a moment to consider this path and the various factors involved in becoming a Singapore PR. After careful deliberation, if you believe this is the right decision, we recommend seeking professional advice from our PR application agency. Having assisted numerous expatriates with their PR applications, we can help you navigate this journey seamlessly. Contact us to book an appointment with our PR consultants today.