Are you looking forward to expanding your property portfolio in Singapore, but dreading the hefty Additional Buyer’s Stamp Duty (ABSD). Fret not since you’re one among many. Many aspiring homeowners and investors in Singapore are looking ways to navigate this tax, while still owning a second property and more.
In this simple guide, we look into the ins and out of ABSD, and unveil effective strategies on how to buy 2nd property in Singapore without ABSD, while staying on the right side of the law. Let’s get started!
Buy the First Home Under One Spouse’s Name
A remarkable tip on How to buy 2nd property in Singapore without ABSD is to purchase your first home under one spouse’s name only. What this simply means is that the other spouse will be regarded as a first-time buyer when they purchase their next property, even if they lived in the first property.
So, how do you go about this without feeling the heat? Well, you need to ensure that only one spouse is listed as the owner on the title deed. The other spouse can be listed as an important occupier, but not as a co-owner. Keep in mind that this only applies for HDB applicants, and that this is not required for applicants of private properties.
Buy a Property Under a Trust For Your Children Below 21
Setting up a property trust for your child can also be a remarkable way to plan for their future and possibly avoid ABSD. This approach entails purchasing a property and placing it in a trust where your child is the beneficiary. But it is important to understand the latest regulations and requirements before proceeding.
Either way, you need to buy the property in cash since banks generally do not offer loans for properties held in trust, especially if the beneficiary is a minor. Moreover, you should remember to engage an experienced conveyancing law firm to draft the trust documents meticulously. The trust deed must meet the specific requirements for ABSD refund, or you could face significant financial losses.
Never let the desire to avoid ABSD dictate your property investment decisions entirely. Carefully evaluate each opportunity, factoring in the potential costs, benefits and your long-term objectives. Hopefully, the above tips on How to buy 2nd property in Singapore without ABSD can serve as a good starting point.
