Drop in Property Tax for Home Owners
The recent developments in economic systems will see owners of public housing paying lower property tax and all private residential home owners will have much lower or no charge to their bills starting next year. This is the latest news from IRAS (Inland Revenue Authority of Singapore).
Change explained in Details
• Owner- occupier of one and two room HBD flats will be exempted from property taxes.
• Three room flat proprietors will be requires to pay nothing or roughly $18.40 which is much lower compared to $37.60 being charged this year.
• Four room flat owners shall pay $52 – $100 which lower compared to the current one of between $71.20 to 4119.20.
• Five room flat owners will pay $83.20 to $131.20 down from $104.80 to $152.80 being levied this year.
• Executive flats will have tax rates ranging from $95.20 to $143.20 which is also much lower than this year.
• All property holders will get their tax bills by end of December, to be paid by 31st January.
The IRAS said that it is necessary to review the annual values of property so as to reflect the prevailing market rentals. A new tax structure that was put in 2014 implicates that property owner who is staying in his or her residential property will be exempted from property tax in the first $8000 of the property’s annual value. This has led to decrease in property tax value thus informing tax review.
Property owners who face financial difficulties should approach the revenue authority to discuss on payment plan before the end of January among them being deferment payment and scheduled instalments. Failure to pay or visit the authority will attract a 5% penalty.
Property taxes are based on annual values and the drop in tax is due to the rental marketing being on a down trend. A lot of new projects are being completed and there is a fall in demand for renting. Another contemporary approach could be the notion that rents trend with the economy. If demand is low, it could be that the economy is down or slow.
Property tax is not something that can be saved on. The more it drops, the better it is. The dip is probably of essence to middle or lower income families. The drop in property tax could be an indirect indicator of a slowing economy; therefore a corrective measure should be taken to save the economy.
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