Most owner-occupied homes will pay less in property tax next year, the Inland Revenue Authority of Singapore said on Tuesday.
Under the new Progressive Property Tax Rates regime announced during Budget 2013, all owner-occupied HDB flats and three-quarters of owner-occupied private homes - or 95 per cent of owner-occupied homes - will see lower property tax bills.
Taking into account non-owner-occupied homes, 80 per cent of all homes will pay lower property tax next year.
With the new property tax structure, the Annual Value (AV) exemption threshold for which no tax applies will be $8,000, up from $6,000 previously. Owners who live in their own homes will not have to pay property tax on the first $8,000 of the AV of their properties from Jan 1, 2014.
The new property tax structure also increases the progressivity of the property tax structure by taxing properties with higher AVs more.
A property's AV is based on the estimated annual market rent of the property if it was to be let out. This is then used as a basis to compute the property tax payable.
The AVs of three- to five-room HDB flats will be revised next year, as market rents for these flats have increased by about 3 per cent since the last revision in January this year.
There will be no change to the AVs of other types of flats as rents on these flats have remained largely the same.
Taking into account their AVs and the new property tax rates, all one- and two-room HDB owner-occupiers will continue to pay no property tax, as the AVs of these flats remain below $8,000.
Get The New Paper for more stories.