Singapore Rental Income Guide

Rental Income Taxed at Individual Income Tax Rates

• Net rental income included in chargeable income: The net rental income (the "gross rental income minus the deductible expenses") is added to the total chargeable income and taxed at the progressive Individual Income Tax rates: 0% on the first SGD 20,000, 2% on SGD 20,001 to SGD 30,000, 3.5% on SGD 30,001 to SGD 40,000, 7% on SGD 40,001 to SGD 80,000, 11.5% on SGD 80,001 to SGD 120,000, 15% on SGD 120,001 to SGD 160,000, 18% on SGD 160,001 to SGD 200,000, 19% on SGD 200,001 to SGD 240,000, 19.5% on SGD 240,001 to SGD 280,000, 20% on SGD 280,001 to SGD 320,000, 22% on SGD 320,001 to SGD 500,000, 23% on SGD 500,001 to SGD 1,000,000, and 24% on the income above SGD 1,000,000.
• Joint ownership: If the property is owned jointly (the "co-ownership"), the rental income is apportioned according to the ownership share. Each co-owner reports the own share of the net rental income on the own tax return.
• Non-resident landlord: The non-resident individual landlord is taxed at the flat rate of 15% on the gross rental income (or the progressive rates on the net income — whichever is higher) if the non-resident does not have the tax resident status in Singapore.

For example: the landlord earning SGD 60,000 in the gross rent with the deductible expenses of SGD 15,000 has the net rental income of SGD 45,000, which is taxed at the progressive rates — the first SGD 20,000 at 0%, the next SGD 10,000 at 2%, and the remaining SGD 15,000 at 3.5%.

15% Deemed Expense Deduction for Furniture and Fittings

• Automatic 15% deduction: The landlord may claim the "deemed expense" of 15% of the gross rental income for the "wear and tear" of the furniture, the fittings, and the appliances (the "furniture and the fittings deemed expense"). The deduction is automatic and does NOT require the actual receipts or the evidence of the expenditure.
• Alternative — actual expense claim: The landlord may choose to claim the "actual expenses" for the furniture and the fittings (the "repair and the replacement costs") instead of the deemed 15% deduction. The actual expense claim requires the supporting receipts and the documentary evidence.
• Distinction from the IRAS deduction: The 15% deemed deduction is separate from the "mortgage interest" and the "other deductible expenses". The landlord may claim the 15% deemed deduction IN ADDITION to the other deductible expenses (the mortgage interest, the management fees, the maintenance costs).

Deductible and Non-Deductible Expenses

• Deductible expenses: The following expenses are deductible from the gross rental income: (a) the "mortgage interest" — the interest paid on the loan used to purchase the rental property (NOT the principal repayment), (b) the "property management fees" — the fees paid to the managing agent or the property manager, (c) the "maintenance and the repair costs" — the costs of the repairs and the maintenance (the "painting, the plumbing, the electrical"), (d) the "insurance premiums" — the fire insurance and the landlord's liability insurance, (e) the "agency fees" — the commission paid to the real estate agent for the tenant sourcing, (f) the "property tax" — the property tax IS deductible for the rental income tax purposes (the "annual value tax" paid to IRAS for the rental property).
• Non-deductible expenses: The following expenses are NOT deductible from the gross rental income: (a) the "capital expenditure" — the cost of the property acquisition (the "purchase price"), the stamp duty, the legal fees for the purchase, (b) the "renovation costs" — the capital improvements that increase the property value (the "extension, the major renovation") — these may be claimed as the "capital allowance" over the useful life, (c) the "principal repayment" on the mortgage — the principal portion reduces the loan balance and is NOT the expense, (d) the "personal expenses" — the utilities, the internet, and the other personal costs.

Important note: the IRAS allows the deduction of the property tax paid on the rental property from the rental income. This is separate from the "annual value tax" which is the property tax itself — the property tax is deductible as the expense against the rental income.

FAQs

Do I need to register for the GST on the rental income?

The rental income from the residential property is exempt from the GST. The landlord does NOT need to register for the GST or charge the GST on the residential rent. The rental income from the commercial property may be subject to the GST if the annual turnover exceeds SGD 1 million.

Can I claim the loss from the rental activity?

If the deductible expenses exceed the gross rental income (the "net rental loss"), the loss may be carried forward to the subsequent year and offset against the future rental income from the same property. The rental loss cannot be offset against the other income (the "employment income, the business income").

How do I report the rental income on the tax return?

The rental income is reported on the "Form B or B1" under the "rental income" section. The landlord must report the gross rental income, the deductible expenses, and the net rental income. The myTax Portal provides the dedicated "rental income schedule" for the detailed reporting.