Property Owners Levied Non-Owner-Occupier Property Tax Rates

Parliamentary Question by Mr Gerald Giam Yean Song:

To ask the Deputy Prime Minister and Minister for Finance between 2000 to 2020 (a) how many property owners have been taxed with non-owner-occupier property tax rates when they were in fact residing in their own homes; (b) what is the total amount of excess tax paid; (c) why is it necessary for a property owner to declare that he is the owner occupying the property in order to enjoy owner-occupier tax rates instead of these rates being applied by default; and (d) whether IRAS will refund property owners the excess tax paid, even if the incorrect tax rates were discovered after they had moved out of their properties.

Parliamentary Reply by Deputy Prime Minister, and Minister for Finance, Mr Heng Swee Keat:

Residential properties are subject to property tax, with higher-value residential properties being taxed at higher rates. Owner-occupied residential properties enjoy concessionary property tax rates. Properties which are rented out or vacant do not enjoy this concession. IRAS publicises information on the property tax rates, including the concession, through various platforms such as its website and annual property tax notice.

Property owners are free to buy one or more properties, and choose to live in any or none of the properties they own. Hence, it is necessary for the property owner to inform IRAS about owner occupation to qualify for the concession.  We do not have statistics on how many property owners live in their own properties but do not enjoy concessionary tax rates.

That said, IRAS has put in place measures for taxpayers’ convenience. First, IRAS grants concessionary rates automatically to all buyers of HDB and DBSS flats, as well as new ECs. These forms of housing are meant for owner occupation. Second, IRAS has been extending the concession automatically to a buyer of a private property or resale EC bought on or after 1 January 2011, if he is a Singapore Citizen or Permanent Resident, and neither he nor his spouse is enjoying the concession on any other residential property.

Residential property owners who are granted the concession automatically are required to inform IRAS if the residential property is not being owner-occupied, and the concession will be withdrawn.

For residential properties bought before 2011, there may be cases which could be eligible for the concession, but the owners did not apply for it. IRAS sent letters during a 2012 exercise to invite them to apply for the concession if they were residing in their property.

On whether a property owner can claim the concession and seek a refund of the excess property tax paid after he has sold the property, IRAS will need to look at the specific circumstances. If the Member has any specific case in hand, he can approach IRAS for a review of the case.