ST : It's time to pay your property tax

18 JAN 2011,
It's time to pay your property tax

Taxman collected $1.35m in penalties last year; deadline is Jan 31

By Dhevarajan Devadas

THE taxman has issued property owners with a timely reminder: Pay your property tax by Jan 31.

The Inland Revenue Authority of Singapore (Iras) also wants to encourage taxpayers to sign up to pay through Giro, in an effort to improve efficiency and reduce late payments.

At a briefing yesterday, Iras corporate communications director Deanna Choo referred to a survey last year that pointed to the top three reasons cited for late payment.

They were: overlooking the deadline; not receiving the bill; and financial difficulties.

'One in three who did not pay on time claimed that they overlooked the deadline,' said Ms Choo.

Last year, 122,000 people, or 11 per cent of residential property owners, did not pay on time. The Iras collected $1.35 million in late payment penalties.

It has been taking steps to rectify the problem.

When it sent out property tax bills in November, the payment voucher came with a Giro application form on the same page. Previously, those who wanted to sign up for Giro had to attach the form separately.

'We hope that this will make it much easier for taxpayers to sign up for Giro and hopefully reduce the number of late payments this year,' said Ms Choo.

Last year, 54 per cent of payments made by residential property owners were through Giro, a figure that has been increasing over the last few years.

As further encouragement for taxpayers to sign up, the Iras announced a 'Giro Your Tax' initiative last October that features an annual lucky draw from this year to 2013.

All taxpayers on Giro stand a chance to win $360,000 in cash prizes. The first of the three draws will be in May.

The progressive property tax system announced in the 2010 Budget will apply from this year. It is three-tiered - zero per cent, 4 per cent and 6 per cent - and replaces the previous flat 4 per cent concessionary rate for owner-occupied residential homes.

The first $6,000 of a home's annual value (AV) will be exempted from tax - saving owners up to $240. The next $59,000 will be taxed at 4 per cent, and any AV above $65,000 will be levied at 6 per cent.

The AV is the estimated annual rent of an owner-occupied property if it were leased, excluding rent for furniture, fittings and any service charge.

ddheva@sph.com.sg