GST implemented – House for sale in Singapore
GST implemented from 1 April 1994 – house for sale in Singapore
- Tax on consumption in Singapore including imports of goods
- Business with annual turnover of more than S$1 million – must be registered as “taxable person” (need not be a company)
- Any person/company can volunteer to be a taxable person but must remain registered for at least 2 years.
- Taxable person who makes taxable supplies must charge GST including:
- All supplies of goods and services (e.g. agent’s commission)
- Sale and lease of movable property (e.g. sale and lease of furniture)
- Sale or lease of non-residential properties (e.g. commercial properties such as sale price of a factory unit or rental of shop)
- Maintenance fee including sinking fund.
Zero-rated tax
- Sale and lease of wholly residential properties & buildings are exempted. For Lease – only the rental component is exempted (i.e. renting of furniture and fittings and maintenance fee are subject to GST)
- Development charge and land premium are exempted
- Goods for export
Fees from services relating to sale/lease of residential properties transactions
Exemption from GST is not extended to the arranging, broking or advisory services relating to the sale/ lease of residential properties. Such fees are subject to GST. house for sale in Singapore
For Example:
You are a real estate/property agent and provide services either in your individual capacity (as a GST registered person) or as an employee of a GST-registered real estate agency. In both instances, the services provided are taxable supplies. This is regardless of whether the properties are residential or commercial in nature.
GST computed for a rented residential property – House for sale in Singapore
Rental of a flat = S$3,500 per month
Rental of the furniture and fittings = S$1,700 per month
Maintenance Fee = S$300 per month
Total gross rental of the furnished flat = S$5,500 per month
Annual value (AV) in the Valuation List = S$36,000
Compute the GST payable.
Calculation
Rent exempted from GST: AV/12 = S$36,000/12 = S$3,000 per month
furniture and fittings subject to GST= Total rent less rent exempted = S$5,500 – S$3,000 = S$2,500 per month
GST on S$2,500 being the rental value of furniture and fittings
= S$2,500 X 7% = S$175/mth
Time of supply for GST payment
At the following situations whichever earlier:
- The time when the goods are removed or when the services are performed
- The time when the tax invoice is issued
- The time when payment is received
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