Stamp Duty on leases is payable based on the contractual rental or the market rental, whichever is higher, at the Lease Duty rates.
On this page:
Stamp duty is payable on documents relating to leases of immovable properties in Singapore such as :
- Lease or tenancy agreement
Please note that licence agreements are not subject to stamp duty. Licence agreements are commonly used for the letting out of a food stall in a food court, coffeeshop or hawker centre. If you are unsure if your agreement is a licence or a lease/tenancy, you may wish to seek independent legal advice or submit the document for adjudication. Please note that adjudication fees will be payable for the latter.
Lease with Fixed Rent
Lease with Variable Rent
A lease with variable rental is one for which the rental varies during the lease period.
e.g.
- Staggered rental for different periods of the lease
- There is a fixed rental component and an additional rental component based on a percentage of the gross sales turnover (GTO)
In a lease involving an additional rental component based on a percentage of the GTO, you are to estimate the GTO and determine the additional rent payable. This additional rent shall be included for the stamp duty calculation i.e. the rent that is subject to stamp duty is the sum of the fixed rental (if any) and the additional rental derived from the estimated GTO.
Where the additional rental component is subject to a maximum or minimum secured sum, the additional rent that is subject to stamp duty shall be:
| Types of additional rental component | Additional rent subject to stamp duty |
|---|---|
| Based on a percentage of GTO, subject to a maximum secured sum | The maximum secured sum |
| Based on a percentage of GTO, subject to a minimum secured sum | The higher of the amount derived from the estimated GTO or the minimum secured sum |
Additional rent subject to stamp duty
Please refer to Examples 1 to 3 below on the calculation of stamp duty for leases involving staggered rental or a percentage of GTO.
Variation of Lease or Supplemental Agreement
If there is an increase in rental or the lease period is extended, stamp duty is payable on the document based on the increase in rental or the rental for the extended lease period.
However, if there is a decrease in rental or the lease period is shortened, stamp duty is not payable for the document.
Other variations where stamp duty is not payable
- Changing the use of the property with no additional payment;
- Lifting the restrictions in the lease with no additional payment;
- Amending the terms of the lease that do not affect the rental and lease term such as addition of an option to renew;
- Bringing forward or deferring the lease before its commencement without a change in the lease term or gross rent.
Please refer to Examples 4 to 6 below on the calculation of stamp duty for variation of leases.
Novation of Lease between an incoming tenant and outgoing tenant
Assignment of Lease (which was executed between the existing landlord and tenant) to the new landlord
Surrender of Lease
Rates and Computation
| Average Annual Rent (AAR)1 | Lease Duty Rates |
|---|---|
| AAR does not exceed $1,000 | Exempted |
| AAR exceeds $1,000 | |
| Lease period of 4 years or less | 0.4% of total rent for the period of the lease |
| Lease period of more than 4 years or for any indefinite term | 0.4% of 4 times the AAR for the period of the lease |
Lease duty is rounded down to the nearest dollar, subject to a minimum duty of $1.
1AAR refers to the higher of the average annual contractual or annualised market rent and includes other considerations such as payments for:
- Advertising and Promotion charge
- Furniture / Fittings charge
- Maintenance charge
- Service charge
- Any other charges, excluding GST charges
Example 1: Lease with Staggered Rent (4 Years or Less)
| Lease Period & Rent | Lease Duty |
|---|---|
3-month Lease | Total Rent Lease Duty |
4-year Lease | Total Rent Lease Duty |
Example 2: Lease with Staggered Rent (More than 4 Years)
| Lease Period & Rent | Lease Duty |
|---|---|
|
5-year Lease |
Total Rent Average Annual Rent 4 Times of AAR Lease Duty |
Example 3: Lease on Commercial Unit Where Rent or Part of Rent is Percentage of Tenant's Sales Turnover (3 Years)
i) A lease with fixed rental and an additional rental based on a percentage of gross sales turnover (GTO), without a maximum or minimum secured sum
| Monthly Rent |
|
| Estimated Gross Sales Turnover | $100,000 |
| Service Charge | $400 per month |
| Advertising and Promotional Charge | $100 per month |
To calculate the Stamp Duty payable:
| Additional Rent subject to Stamp Duty | 0.5% x GTO = 0.5% x $100,000 = $500 |
| Estimated Gross Rent Per Month | $5,000 + $500 (i.e. the additional rent) + $400 + $100 = $6,000 |
| Total Rent | $6,000 x 36 months = $216,000 |
| Stamp Duty Payable | 0.4% x $216,000=$864.00 |
ii) A lease with fixed rental and an additional rental based on a percentage of GTO that is subject to a minimum secured sum
| Monthly Rent |
|
| Estimated Gross Sales Turnover | $100,000 |
| Service Charge | $400 per month |
| Advertising and Promotional Charge | $100 |
To calculate the Stamp Duty payable:
| Additional Rent subject to Stamp Duty | The higher of the amount derived from the estimated GTO or the minimum secured sum:
The additional rent subject to stamp duty would be $600 |
| Estimated Gross Rent Per Month | $5,000 + $600 (i.e. the additional rent) + $400 + $100 = $6,100 |
| Total Rent | $6,100 x 36 months = $219,600 |
| Stamp Duty Payable | 0.4% x $219,600 = $878.40 $878 (rounded down to the nearest dollar) |
iii) A lease with fixed rental and an additional rental based on a percentage of GTO that is subject to a maximum secured sum
| Monthly Rent |
|
| Estimated Gross Sales Turnover | $100,000 |
| Service Charge | $400 per month |
| Advertising and Promotional Charge | $100 per month |
To calculate the Stamp Duty payable:
| Additional Rent subject to Stamp Duty | Maximum secured sum = $650 |
| Estimated Gross Rent Per Month | $5,000 + $650 (i.e. the additional rent) + $400 + $100 = $6,150 |
| Total Rent | $6,150 x 36 months = $221,400 |
| Stamp Duty Payable | 0.4% x $221,400 = $885.60 $885 (rounded down to the nearest dollar) |
Example 4: Increase in Rental Where the Original Lease Period and Parties Remain the Same (More Than 4 Years)
| Original Lease Period & Rent | Variation of Lease / Supplemental Agreement |
|---|---|
5-year Lease | 5-year Lease 1st year: $2,000 per month 2nd year: $2,500 per month 3rd year: $3,500 per month 4th year: $3,800 per month 5th year: $4,300 per month |
| Total Rent ($1,800 + $2,000 + $2,500 + $3,000 + $3,300) x 12 = $151,200 | Total Rent ($2,000 + $2,500 + $3,500 + $3,800 + $4,300) x 12 = $193,200 |
| Average Annual Rent $151,200 / 5 = $30,240 | Average Annual Rent $193,200 / 5 = $38,640 |
| Total Rent (Capped at 4 Years) $30,240 x 4 = $120,960 | Total Rent (Capped at 4 Years) $38,640 x 4 = $154,560 |
Increase in Total Rent (Capped at 4 Years) | |
Stamp Duty Payable (0.4% of the increase in Total Rent & Capped at 4 Years) $134 (rounded down to the nearest dollar) |
Example 5: Bringing forward / Deferring the lease
If the lease period has not commenced, and the lease was brought forward or deferred without any changes in the gross rent or lease term, stamp duty is not payable.
i) Bringing forward the lease
| Original Lease Period & Rent | Variation of Lease / Supplemental Agreement before lease commences |
|---|---|
| 6-month lease 1 Jun 2020 – 30 Nov 2020 | 6-month lease where lease start date was brought forward to 1 Apr 2020 1 Apr 2020 – 30 Sep 2020 |
| Monthly Rent $3,000 per month | Monthly Rent $3,000 per month |
| Total Rent $3,000 x 6 = $18,000 | Total Rent $3,000 x 6 = $18,000 |
| Stamp Duty is not payable on the Variation of Lease as there is no change in the gross rent or lease period |
ii) Deferring the lease before lease period commences
| Original Lease Period & Rent | Variation of Lease / Supplemental Agreement before lease commences |
|---|---|
| 12-month lease 1 Jun 2020 – 31 May 2021 | 12-month lease where the lease start date was deferred to 1 Sep 2020 1 Sep 2020 – 31 Aug 2021 |
| Monthly Rent $5,000 per month | Monthly Rent $5,000 per month |
| Total Rent $5,000 x 12 = $60,000 | Total Rent $5,000 x 12 = $60,000 |
| Stamp Duty is not payable on the Variation of Lease as there is no change in the gross rent or lease period |
If the lease period has commenced, and the lease was brought forward or deferred without any changes in the gross rent and/or lease term, stamp duty is payable.
iii) Deferring the lease after lease period commences
| Original Lease Period & Rent | Variation of Lease / Supplemental Agreement after lease commences |
|---|---|
6-year lease 1 Oct 2024 - 30 Sep 2030 | 6-year lease where the lease start date was deferred to 1 Nov 2024 1 Nov 2024 - 31 Oct 2030 |
| Monthly Rent $5,000 per month | Monthly Rent (no change) $5,000 per month |
From 1 Oct 2030 to 31 Oct 2030: Duty is computed based on the total rent, as if it is an extension of lease $5,000 x 0.4% = $20
Total Stamp Duty payable $20 | |
However, if the lease was brought forward or deferred, with a change in gross rent and/or lease term, stamp duty is payable on the Variation of Lease or Supplemental Agreement, regardless of whether the lease has commenced.
If you are unsure if the Variation of Lease or Supplemental Agreement is liable to stamp duty, you may submit the document for adjudication. Please note that adjudication fees will be payable.
Example 6: Extension of a lease term without change in gross rent
The landlord grants an extension to the lease period, but provided a rent-free period equivalent to the extended period. Stamp duty is payable on the extended period.
| Original Lease Period & Rent | Variation of Lease / Supplemental Agreement |
|---|---|
| 12-month lease 1 Jan 2020 – 31 Dec 2020 |
15-month lease where the original lease period was extended by 3 months 1 Jan 2020 – 31 Mar 2021 |
| Monthly Rent $10,000 per month |
Monthly Rent First 3 months: $10,000 per month Next 3 months: $0 (Rent-free period) Remaining 9 months: $10,000 per month |
| Total Rent $10,000 x 12 = $120,000 |
Total Rent First 3 months: $10,000 x 3 = $30,000 Next 3 months: $0 (Rent-free period) Remaining 9 months: $10,000 x 9 = $90,000 Total Rent: $30,000 + $0 + $90,000 = $120,000 |
| Stamp Duty Payable (0.4% of the rent for the extended period from 1 Jan 2021 – 31 Mar 2021) 0.4% x ($10,000 x 3) = $120 |
For rates before 22 Feb 2014, please refer to Stamp Duty for Property.
Please refer to How to stamp Lease or Tenancy Agreements for the illustrated guide for stamping a Lease or Tenancy Agreement.