Understanding the Costs of Selling Your HDB Flat
Costs and Financial Obligations
Selling your HDB flat incurs several fees, including legal fees, agent commissions, and administrative charges. It is crucial to factor these into your financial planning to determine your net proceeds accurately.
What are the fees and costs involved in selling my HDB flat?
The primary fees involved in selling your HDB flat are legal conveyancing fees, your property agent’s commission, and an HDB administrative fee. If you’re selling a subsidized flat and intend to buy another one, you’ll be required to pay the resale levy.
Expect to incur legal costs, agent fees, and HDB resale application fees. CPF refunds and possible resale and upgrading levies add to the total outlay.
Legal Conveyancing Fees:
- The legal fees cover the conveyancing process, which is the legal transfer of ownership to the buyer. You can either hire a private lawyer or use HDB’s legal services, with costs varying accordingly.
Agent Commissions:
- Your property agent’s commission is typically a percentage of the selling price and is negotiable.
HDB Administrative fee:
- The administrative fee for an HDB resale application is $80 for 3-room and larger flats, and $40 for 1- and 2-room flats. This fee is payable by both the buyer and the seller when submitting their portion of the resale application via My Flat Dashboard.
Refund of CPF savings:
- You’ll need to refund the CPF savings you used for the flat’s purchase, along with the accrued interest, when you sell your HDB flat, and when you transfer or sell your share of your property to another party.
Resale Levy (if any):
- If you’re selling your first subsidised HDB flat (i.e. a BTO or SBF flat), a Design Build and Sell Scheme (DBSS) flat, or an Executive Condominium (EC), or a resale flat with CPF Housing Grant(s), and buying a second subsidized flat, you’ll need to pay the resale levy upon the sale of your first flat, or upon key collection of your second flat, whichever comes later.
*If you do not intend to buy a second subsidised flat from HDB, i.e., you are buying a resale flat without taking any CPF Housing Grant or private residential property, you need not pay the resale levy.
Upgrading Levy (if any):
- If your existing flat is in an upgraded* precinct, you may have to pay an upgrading levy when you sell the flat. The 10% upgrading levy is calculated based on the selling price of the flat, or 90% of the market value of the flat, whichever is higher.
*Singapore Citizen (SC) households who have benefitted from the previous Main Upgrading Programme (MUP) (discontinued from August 2007) 2 times or more; or
Singapore Permanent Resident (SPR) households whose flats were upgraded under MUP (Batch 6 and before)
Do I need to pay Seller’s Stamp Duty (SSD) when I sell my HDB?
Generally, HDB sellers are not subject to Seller’s Stamp Duty (SSD) when you sell your HDB flat as you would have fulfilled the Minimum Occupation Period (MOP) of five years. SSD is only payable if you sell your flat within the first three years of purchase.
However, in very rare and specific cases where an HDB flat is disposed of within three years (e.g., through a transfer), SSD might be applicable.
For most HDB sellers, Seller’s Stamp Duty (SSD) is not a concern due to Minimum Occupation Period (MOP).
Do I need to pay property tax or other fees when selling?
Yes, you are required to pay the property tax up to the end of the year, even if you sell your flat mid-year. You will also need to ensure that your Service & Conservancy Charges (S&CC) are paid up to the date of the resale completion.
Settling your property tax and S&CC is a necessary step in the selling process.
What are the tax implications of selling my HDB flat?
In Singapore, there is no capital gains tax on the sale of property for individuals who are not considered to be trading in properties. Therefore, the profit you make from selling your HDB flat is not taxable.
However, if you sell multiple properties as part of a business (e.g. flipping), IRAS may view your income as taxable. For typical homeowners, there’s no tax liability
Most HDB sales are not subject to income tax or capital gains tax.
The profit from your HDB sale is generally not subject to income/capital gains tax:
- Singapore’s tax laws do not treat profits from the sale of residential property as a capital gain for individuals, provided it is not part of a property trading business. This means that the proceeds you receive from the sale of your HDB flat, after deducting all the associated costs and refunding your CPF, are not considered taxable income. The primary tax-related consideration for sellers is the Seller’s Stamp Duty, which is typically not applicable to HDB flats due to the MOP.
Ready to Sell Your HDB Flat?
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Take the next step in your selling journey
If you have more questions or need personalized advice on selling your HDB flat, our team of experienced property agents is here to help. Contact us today for a non-obligatory consultation and a detailed breakdown of the potential costs for your specific situation. Let us help you navigate the selling process with ease and confidence.