Company-Owned Properties Already Enjoy Tax Deductions

In her letter (‘Relook tax rates for company-owned property’, 18 Nov), Mdm Sophia Yap asked why company-owned property could not be taxed at the owner-occupied rates. She also requested that the Inland Revenue Authority of Singapore (IRAS) review the tax structure to help reduce the business costs of small business operators.

We have a standard property tax rate structure for all properties, including residential rental, commercial and industrial properties. The only exception is owner-occupied residential property, where owner-occupiers are given concessionary property tax rates to lower the tax burden on households, in particular HDB households.

If a business uses a property (that it owns) for business purpose, it may deduct the property tax as an operating expense against its business income. This will reduce the amount of profits brought to tax for income tax purpose.

For YA2011, the Government has provided corporate income tax rebates and SME cash grants to help companies, especially SMEs, cope with business costs. It will continue to monitor the business costs environment to ensure that Singapore remains competitive for businesses.

Lim Bee Khim (Ms)
Director (Corporate Communications)
Ministry of Finance