Property Tax Due: What Should My Business Do?

Businesses need to provide timely property tax payments, as that money goes into government funds which are later used for important things, such as the salary of government employees and common resources. In addition, if you don’t pay your business taxes on time, you will face penalties, get bad credit ratings, and lose potential investors. However, business taxes don’t have to be complicated if you follow our guide on business taxes in Singapore. One important upcoming tax due in the coming year is property tax. If you’re wondering whether it affects your business and what you should do in that regard, keep reading to find out. Overview:

What is property tax?

Property tax is a tax on property ownership and applies whether the property is rented out, owner-occupied or vacant. Just like a homeowner is required to pay property taxes on their home, a business owner is responsible for paying property taxes on any company-owned property. If your business owns any real estate such as buildings or land, you are required to pay Singapore property tax for them. The property tax is calculated based on your locality and most of the time, the business property tax is assessed by the country or city in which the property is located. Your business property tax rate will be determined based on the value of the land or real estate the business owns. This property value will be determined by your local tax department and so will the amount of annual property tax you need to pay. There is also a possibility that you will be required to pay a property tax when you want to sell or purchase the business property. In some localities, in the cases of purchasing a property, the property tax is split in two. One half of the property tax is paid by the current property owner who is selling the land or real estate and the other one by the buyer. In some cases, you will have to pay property taxes not only for the buildings and land you own but also for any personal property your business owns. This is called a personal property tax and it includes all the items that are necessary for business operations. The property taxes you pay will be used to help fund public safety, local schools, any new construction projects that are happening in your locality, and so on.

When is property tax due?

An official announcement at Supplementary Budget 2020 introduced various improvements regarding PSG. The grant was enhanced to encourage enterprises to continue their digitalization and productivity improvement efforts. The maximum funding support level has been increased to 80% from 1 April 2020 to 30 September 2021. Due to the pandemic, the scope of generic solutions has been expanded and of course, these measures were created to help enterprises combat the effects of COVID-19. These are the tools that have expanded the generic solutions:
  • Virtual meeting tools
  • Online collaboration tools (covering remote working solutions)
  • Temperature screening tools
  • Queue management systems
Keep in mind that the support for COVID-19 business continuity measures has ended on 31 December 2020. Hence, all businesses that have applied before the stipulated date got a chance to enjoy the measures package. However, there are rumours that the government is planning to design a new set of relief measures, since the pandemic is unfortunately not nearing its end. All interested parties that would like to see available solutions can do so on GoBusiness Gov Assist. Taking a good look at the solutions could help a business determine the relevant and right-sized PSG support packages.

Does property tax affect your business?

If you’re wondering if the Singapore property tax affects your business, the answer is yes, but only if it’s a commercial or industrial property. This means that the property you own is not a residential property. Any commercial and industrial properties that qualify as non-residential are taxed at 10% of their total annual value. It’s also important to state that no owner occupier tax rates apply to any non-residential properties. That includes the cases where a property owner has purchased the land or real estate for their own use or occupation.

How to pay your property tax?

There are multiple ways you can pay your property taxes, and we’ll list the most popular methods below.

AXS (stations, internet, and mobile)

To make property tax payments at an AXS station:
  • Bring your Payment Slip.
  • Scan the bar code that is located at the bottom of the slip or key in the Payment slip number. You can also enter your Tax Reference Number to pay for property tax or individual income tax.
  • Once the payment transaction is complete, you will be issued a receipt.
If you’re not on the GIRO payment play, you will be issued a payment slip with your tax bill. ACS stations accept the following cards:
  • Automated Teller Machine (ATM) cards from Citibank, DBS/POSB, Maybank, OCBC, Standard Chartered Bank, and UOB. Your bank will limit the payment limit amount.
  • Diners Club Card and DBS/POSB Credit Card. The Diners Club or your bank will determine your payment limit.
You can also access the AXS e-service through the AXS website. If you want to make your payment through the AXS m-Station application, you need to go to the Google Play store of the Apple App Store and search for “AXS Payment” to find the application. To pay for property tax, you need to enter your Tax Reference Number and to complete a payment, you need to go through eNETS Debit and have existing bank accounts with Citibank, DBS/POSB, OCBC, Standard Chartered Bank, or UOB. If you choose any of these methods for payment via AXS, the payment will be updated to your tax account immediately.

Internet banking with POSB/ DBS/ OCBC/ UOB

If you have an individual account with POSB, DBS, OCBC, or UOB you can pay your Singapore property tax via Internet Banking Bill Payment by doing the following:
  • Log in to your bank’s Internet Banking Portal.
  • Select the “Bill Payment” option and for the Billing Organization, select “IRAS”.
  • Enter your Tax Reference Number of the 14-Digit Payment Slip Number under Bill Reference/ Bill Account/ Consumer Reference Number field. If you’re not on a GIRO payment plan, the Payment Slip will be issued together with your Tax Bill. To complete your property tax payments, you need to select “IRAS-PTY TAX” and enter the Property Tax Reference Number.
  • Enter the amount you want to pay, but keep in mind that your bank subjects this amount to the daily Internet Banking payment limit.
After the payment is received, your payment will be posted into the tax account within three working days.

SAM (kiosks, internet, and mobile)

To pay your property taxes through the 24-hour SAM kiosk:
  • Bring your Payment Slip.
  • Scan the bar cord that is located at the bottom of the slip or key in the Payment slip number. You can also enter your Tax Reference Number to pay for property tax or individual income tax.
  • Once the payment transaction is complete, you will be issued a receipt.
This payment method can only be used by people who own NETS cards with DBS/POSB, OCBC, Standard Chartered Bank, and UOB. Your bank will set the limit for the amount that can be deducted and your payment will be posted into the tax account immediately. To make your payment via the SAM web, you need to access the SAM website. To make your property tax payment through the SAM Mobile application, you need to go to the Google Play store of the Apple App Store and search for “SingPost SAM” to find the application. The application supports both Android and iOS. To make your payment, key in your Payment Slip Number or Property Tax Reference Number. If you aren’t on the GIRO payment play, you will be issued a payment slip. Payments can be made via GIRO-On-Demand or eNETS Debit. To complete your payment via NETS Debit, you need an existing Internet Banking account with Citibank, DBS/POSB, OCBC, Standard Chartered Bank, or UOB. This payment mode has a daily payment limit.

NETS at any post office counter

The following post offices accept property tax payments by NETS and Cash Card over the counter:
  • Chinatown
  • Jurong Point
  • Novena
  • Tampines Central
  • Toa Payoh Central
  • Woodlands Central
After the payment is received, your payment will be posted into the tax account within three working days.

GIRO

GIRO is the preferred method of payment for many property owners and you can apply for GIRO online via:
  • The myTax portal for DBS/POSB and OCBC customers
  • Internet banking for DBS/POSB, OCBC, and UOB customers
  • AXS station for DBS/POSB customers
Your GIRO arrangements will be set up within 3 working days. If you apply for a Master GIRO, you can pay your property tax by completing one GIRO application form. To sign up for Master GIRO, you need to use your own bank account.

Wrap up

If you pay your property taxes early, you won’t have to worry about getting monetary penalties that can be quite high or a bad credit rating that will negatively influence your chances of getting a loan in the future. Even though taxes seem daunting at times and nobody wants to pay them, you’re still obligated by law to do so. Keep in mind that taxes don’t have to be complicated and you shouldn’t miss any payments just because you aren’t sure how property taxes work. Sleek offers accounting services that provide convenience for your business and if you have any further questions, you can always talk to our sales team.

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