In Singapore, tenants often focus on rent and deposits when signing a lease, but Stamp Duty is another important cost that should not be overlooked. Whether you’re renting a residential unit or commercial space, understanding stamp duty rules can save you from unnecessary penalties and help you budget effectively.
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🏢 1. What is Stamp Duty on Leases?
Stamp Duty on Leases is a tax payable to the Inland Revenue Authority of Singapore (IRAS) when a tenant signs a lease or tenancy agreement. It applies to both residential and commercial properties and is calculated based on the Average Annual Rent (AAR) and lease duration.
📅 2. When is Stamp Duty Payable?
- Within 14 days from signing the lease (if signed in Singapore).
- Within 30 days from receiving the lease in Singapore (if signed overseas).
- Payment must be made before the lease is enforceable in court.
💰 3. How to Calculate Stamp Duty
Stamp Duty for leases is calculated using the formula:
Stamp Duty = Lease Duty Rate × Average Annual Rent × Lease Term (in years)
Stamp Duty Rates (as of 2025)
| Lease Term | Stamp Duty Rate |
|---|---|
| 1 year or less | 0.4% of total rent for the lease period |
| More than 1 year but ≤ 3 years | 0.4% of 3 × AAR |
| More than 3 years or indefinite term | 0.4% of 4 × AAR |
Example: If your monthly rent is $3,000 and your lease term is 2 years:
- AAR = $3,000 × 12 = $36,000
- Stamp Duty = 0.4% × (3 × $36,000) = $432
📝 4. Who Pays the Stamp Duty?
In most cases, the tenant pays the stamp duty unless otherwise stated in the lease agreement. However, it is possible for the landlord and tenant to negotiate a shared payment arrangement.
⚠️ 5. Penalties for Late Payment
- $10 or an amount equal to the duty, whichever is greater, if paid late by up to 3 months.
- Double the duty amount if paid late by more than 3 months.
Late payment may also affect your legal rights under the lease agreement.
📌 6. How to Pay Stamp Duty
Tenants can pay via the IRAS e-Stamping Portal using NETS, PayNow, or internet banking. A stamped copy of the lease should be retained as proof of payment.
💡 7. Tips for Tenants
- Always factor stamp duty into your rental budget.
- Ensure payment is made within the deadline to avoid penalties.
- Keep a copy of the stamped lease for legal protection.
📍 Final Thoughts
Stamp duty on leases in Singapore is a legal obligation that tenants cannot overlook. Whether renting a home or office, timely payment ensures compliance with tax laws and safeguards your rights under the lease.
