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Ever since the increase in Additional Buyers’ Stamp Duty (“ABSD”) rates on 6th July 2018, the demand for decoupling, property purchases under trust and consultations for asset progression has steadily increased.

The ABSD rates payable will depend on your residency status, and the rate you pay is base on the number of properties you own at the time of purchase.

See the table below which was extracted from the IRAS website.

ABSD iras

Many people have asked how to avoid ABSD or reduce the amount payable. There are 3 ways to avoid or reduce the amount of ABSD payable on subsequent residential property purchases.

Decoupling (Part Share Purchase)

This method is only applicable to private property. It is by far the most popular and commonly used method by most couples who jointly own an existing private property.

First of all, the term “decouple” does not mean that you need to really file for a divorce with your husband/wife. The decoupling method simply means the transfer or sale of the existing share of the property to your partner or co-owner.

For instance, if you are buying over your partner’s share of the current property, you will be required to pay whatever CPF amount (with accrued interest) that is being utilized for the funding of the current property. To find out how much CPF is being utilized, your partner needs to log in to the CPF website using SingPass. 

In addition, if there is an outstanding mortgage for the current property, the bank will do a re-assessment of your financial status in order to determine if you have the financial capability to finance the rest of the outstanding mortgage on your own.

If your current property has already been fully paid off and there is no CPF used for the current property, you can transfer the ownership by the way of gift.


Something to note is if you are using the decoupling method. Once the decoupling or part share purchase is completed, you are technically assuming a brand new ownership status to the current property. Therefore, you will be subjected to the Seller’s Stamp Duty (SSD) if you were to sell the current property within the first 3 years from the date of transfer.

The decoupling method to avoid ABSD is actually quite straight forward. However, there are still plenty of things to take note of. A professional calculation of the amount is advised because you need to know how much cash proceeds you have after the decoupling process. 

If your current property price has appreciated and you would like to move to another location, it’s always good to consider selling and buy two other properties (with more growth potential of course). 

Buy through a trust

Before I explain this method, please note that in order to buy a property through a trust, you need to purchase the property with full cash. No CPF or bank loan is allowed to fund the purchase under a trust.

This method of buying through a trust is extremely popular among the affluent class of buyers who wish to buy a property for their children (below 21 years of age).

When you purchase a property on trust for your child, you cannot:

  • Use your CPF funds as it can only be used for purchasing your own property.
  • Obtain a mortgage loan to finance the property.

Here are some of the fiduciary duties of the trustee:

  • Not to make a secret profit from the Trust.
  • Act in good faith and do not misappropriate trust funds.
  • Always comply with the terms and conditions in the Trust document
  • Administer a proper account of his/her dealings; furnish all information and accounts to the beneficiary when requested.
legal trust document

In short, the property belongs to the child and the parents (the trustee) are accountable to the child. For instance, if the property is being used for investment purposes (i.e rental), the rental proceeds or income generated from this property will belong to the child and the child who is the beneficiary has all the rights to these monies.

There are a lot of technical considerations when it comes to buying a property through a trust. It is best to seek legal advice from your lawyer if you want to create a trust. As professionals in the real estate industry, we always advise that the vehicle of trust should not be used to evade ABSD. Therefore, use this method carefully and with a good cause in mind.

Purchase as matrimonial property

This method is only applicable to married couples (must include a spouse who is a Singapore citizen) purchasing their first residential property in Singapore.

There is ABSD remission when you purchase the property together as a couple. This can be done by your legal representative (which is usually the conveyancing lawyer) where the lawyer will e-Stamp and obtain the remission certificate.

Another situation which a couple can apply for ABSD remission is when they are buying a second residential property while trying to sell off their existing property.

Unlike the earlier case, the couple will have to pay the ABSD first when they purchase their next property. After they have sold their current property, they can make an application to claim the ABSD which was paid. Do note that this application must be made within 6 months from the contract date of sale of the first residential property.

You can visit some of the common remissions and reliefs from the IRAS website.

Is there a way to get ABSD exemption?

If you are looking into buying a property in Singapore and do not want to incur any or avoid ABSD completely, the only sectors will be the commercial and industrial properties. Currently, ABSD is not payable for acquiring these properties.

avoid ABSD

Recently, there are investment seminars being held to ‘teach’ people on how to own multiple properties in Singapore without paying ABSD. They are basically referring to industrial and commercial properties, so don’t be fooled by their marketing gimmicks.  

I hope you find this article useful and please note that it only provides you with a general guide on the topic and do not tantamount to the provision of any legal advice. If you wish to find out more and whether any of these methods suit your objectives, simply arrange a non-obligatory discussion with me, so I can do a detailed calculation and advise you further.

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