When to pay rental income tax Singapore?
In Singapore, all rent payments received for property rental are subject to rental income tax Singapore. Knowing when to declare these earnings in your Income Tax Return is essential. Rental income is taxable from when it is due and payable to the property owner, not from the date of actual receipt.
Consider this scenario: Your tenant rented your property from September to December 2022 but only paid the rent for this period in January 2023. You must declare the rent for September to December 2022 for the Year of Assessment (YA) 2023 since it was due to you in 2022.
Singapore rental income tax rates
There are three different kinds of taxes to consider for the rental income tax Singapore.
Personal income tax (for Singapore residents)
The rent taxation in Singapore for individuals is based on the net rental income after deducting allowable expenses. The individual income tax rate in Singapore applies to this net amount. If you solely own the property, 100% of the rental income is taxed on you, regardless of who receives the rent. For jointly owned properties, the rental income is divided based on the legal share of the property. You will find an overview of the current personal tax rate in Singapore in the table below (from YA 2017 to YA 2023, as the government increased the tax rates from YA 2024).
| Chargeable income | Tax rate | Tax amount |
|---|---|---|
| Up to SGD 20,000 ($14,800) | 0% | 0 |
| SGD 20,001 ($14,801) to SGD 30,000 ($22,200) | 2% | 200 |
| SGD 30,001 ($22,201) to SGD 40,000 ($29,600) | 3.5% | 350 |
| SGD 40,001 ($29,601) to SGD 80,000 ($59,200) | 7% | 2,800 |
| SGD 80,001 ($59,201) to SGD 120,000 ($88,800) | 11.5% | 4,600 |
| SGD 120,001 ($88,801) to SGD 160,000 ($118,400) | 15% | 6,000 |
| SGD 160,001 ($118,401) to SGD 200,000 ($148,000) | 18% | 7,200 |
| SGD 200,001 ($148,001) to SGD 300,000 ($222,000) | 19% | 11,400 |
| Above SGD 320,000 ($236,800) | 22% | – |
Personal income tax (for non-residents)
Foreigners and non-residents of Singapore pay personal income tax on rental income generated in the country. There are two types of income tax for non-residents, as shown in the table below. They are subject to a 22% tax rate on their rental income.
| Income source | Tax rate |
|---|---|
| Employment income | 15% |
| Director’s/consultation fees, rental income, and all others | 22% |
Corporate tax
For corporations that own rental properties in Singapore, rental income is subject to corporate tax. It’s important to distinguish between Singapore property tax, levied on ownership, and rental income tax Singapore, levied on earnings from renting out property. The table below shows the current corporate tax rate in Singapore.
| Taxable income | Tax rate |
|---|---|
| All amounts | 17% |
Tax deductions on rental property Singapore
Owners can reduce their taxable income by claiming expenses incurred to produce the rental income. Not all Singapore income tax rental expenses can be deducted. Starting from the Year of Assessment 2022, specific expenditures like repairs, insurance, and property tax during vacancy periods can be deducted, provided reasonable efforts were made to secure a tenant.
What cannot be deducted from tax?
Certain expenses are non-allowable under tax deductions on rental property Singapore:
- Repayments of the principal loan or mortgage amount.
- A penalty imposed for late payment or non-payment of property tax.
- Cost of initial repairs or repairs resulting in improvements/additions.
- Depreciation of furnishings.
- Expenses for properties that aren’t generating rental income.
How to report your rental income tax Singapore?
You report the rental income tax Singapore to IRAS (Inland Revenue Authority of Singapore). To stay in line with renting tax compliance in Singapore, property owners must declare the gross rent and deductible expenses under ‘Other Income: Rent from property’ in the Income Tax Return. Using resources like the rental income tax calculator Singapore is crucial for accuracy. For properties owned by a partnership, rental income should be reported in the partnership Income Tax Return (Form P).
Notably, there are penalties for reporting late or inaccurately. However, the IRAS might waive these if voluntary disclosure is done within the grace period.
Want to rent out your property in Singapore?
If you’re planning to become a landlord in Singapore, it’s essential to understand the Singapore rental property tax guidelines. It’s recommended to seek advice from a Singapore rental property tax consultant, especially if you’re unsure about aspects like Singapore tax exemptions for rental income or Singapore taxation for non-residents on rental income. With proper knowledge and guidance, navigating Singapore’s real estate income tax landscape can be smooth and profitable.
Get help with property rental income tax in Singapore
Understanding the rental income tax Singapore is essential before investing in property in Singapore. To navigate the legal framework effectively and ensure peace of mind, seeking guidance from professionals specializing in property taxes, investment due diligence, and property sales is recommended. This will not only save time but also guarantee a smooth transaction.
Frequently Asked Questions (FAQs)
How to file rental income tax Singapore?
To file rental income tax in Singapore, landlords must declare their rental earnings in their annual income tax returns. Ensure all documents, such as rental agreements and payment records, are on hand for a smooth filing process.
How to calculate rental income tax Singapore?
To calculate rental income tax in Singapore, start by determining your gross rental income. Deduct allowable expenses like property tax and repairs. Then, apply the relevant tax rate to the net taxable rental income to get your tax due.
What is the tax rate for rental income in Singapore?
The tax rate for rental income in Singapore is based on the individual’s progressive resident tax rate. Determining your tax bracket is essential to ascertain the specific rate applicable to your rental income.
Is rental income taxable in Singapore?
Yes, rental income is taxable in Singapore. Landlords must report their rental earnings as part of their annual income tax returns.
Is overseas rental income taxable in Singapore?
Yes, for Singapore tax residents, overseas rental income is taxable in Singapore. It’s essential to declare this income when filing your tax returns.
What is the rental income tax rate in Singapore for foreigners and non-residents?
The rate for rental income tax Singapore for foreigners and non-residents is a flat rate of 22%. Ensure you understand the tax obligations specific to your residency status.
