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Corporate entity versus individual: Differences in property ownership

1. Private versus public

While individual property owners can own both private and HDB housing, businesses are limited to private property. Married couples, as well as singles above the age of 35, qualify for HDB flats (so long as they are citizens or PRs), while condominiums and landed homes are available for both individual buyers of any age, as well as corporate entities.

2. Doing your duty

Do bear in mind that regardless of your status, stamp duties still apply. If you are an individual buyer, you are subject to a Buyer’s Stamp Duty (BSD) of one percent of the first $180,000 of the property’s purchase price or its market value (whichever is higher), two percent of the next $180,000 and three percent of the remaining amount. This is regardless of whether a HDB or private property is bought.

The next type of stamp duty is the Additional Buyer’s Stamp Duty (ABSD). This applies to Singapore citizens buying their second property onwards, with the ABSD at seven percent for the second property and 10 percent for the third. Singapore PRs, however, have to pay the ABSD from their first property purchase, at a respective five and 10 percent for the first and second property. If you are a foreigner or part of a corporate entity, this translates to 15 percent for any property purchase.

3. Lease after death

What happens after one of the property owners passes away? If the ownership is a joint tenancy, the deceased’s interest in the property is automatically transferred to the surviving owners. Under a
tenancy-in-common, the fate of the deceased’s interest in the property depends on his will; in the absence of a will, this interest falls into the hands of the law.

In the case of individual HDB owners, the property automatically passes to the surviving spouse or children. If the deceased does not have a surviving spouse or children, the flat is returned to the HDB.

If a corporate entity owns a residential property and one of the owners passes on, what happens to his interest in the property depends on the contract he had signed as part of the corporate entity. The entity’s property ownership is otherwise unaffected.

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