Decoupling property in Singapore refers to a legal process where one co-owner of a private property transfers their share of ownership to the other co-owner. As a result, the remaining owner becomes the sole legal owner of the property.
This is most commonly done to avoid Additional Buyer’s Stamp Duty (ABSD)—a hefty tax imposed when someone purchases a second residential property in Singapore.
If you’re a couple or family thinking about upgrading, investing, or owning multiple properties, decoupling may seem like a clever workaround. But this move comes with legal, financial, and estate planning implications that must be understood clearly before proceeding.
Let’s break it all down.
What Is Decoupling Property and Why Do People Do It?
In Singapore, when you purchase a second residential property, you’re required to pay Additional Buyer’s Stamp Duty (ABSD). As of 2024, Singapore citizens must pay 20% ABSD on the purchase price or market value of a second home—whichever is higher.
Decoupling helps avoid ABSD by making one party (e.g. the wife) the sole owner of the existing home. This frees up the other party (e.g. the husband) to be treated as a first-time buyer when purchasing another property, thus saving 20% or more in taxes.
Here’s a quick example:
If a married couple jointly owns a condo and wants to invest in a second property:
- They can decouple by transferring one party’s share to the other.
- The remaining sole owner retains the first property.
- The other party is “decoupled” and can now buy a second property without ABSD as they are no longer an existing property owner.
How Does the Decoupling Process Work in Singapore?
Decoupling is essentially a legal sale and transfer of ownership, even though it’s between spouses or family members.
Here’s how it works step-by-step:
- Property Valuation
A valuation of the current property is obtained to determine the fair market value of the share being transferred. - Sale of Share
One party “sells” their share (e.g. 50%) to the other party. This is done legally via a Sale and Purchase Agreement (S&P Agreement), similar to a typical property transaction. - Legal Conveyancing
A property lawyer handles the legal transfer, including submission to the Singapore Land Authority (SLA) and IRAS (Inland Revenue Authority of Singapore) for stamp duty filing. - CPF Refunds (If Used)
If CPF funds were used to purchase the property initially, the selling party must refund their CPF principal + accrued interest. This amount goes back into their CPF Ordinary Account. - Stamp Duties
Buyer’s Stamp Duty (BSD) is payable by the buyer (even if it’s a spouse). BSD is based on the market value of the transferred share. - Loan Reassessment (If Any)
The sole buyer may need to refinance or restructure their mortgage loan if the current loan was based on both owners’ incomes.
If you’re unsure about how this affects your mortgage or CPF usage, our Property & Finance Law experts can guide you through calculations and planning.
What Are the Costs Involved in Decoupling Property?
While decoupling can save tens or hundreds of thousands in ABSD, it’s not free. Here’s a breakdown of potential costs:
- Buyer’s Stamp Duty (BSD): Payable on the portion being transferred (e.g. 3–4% of half the home value)
- Legal Fees: Lawyer fees for conveyancing, S&P drafting, and CPF-related documentation
- Valuation Fees: Independent valuation required
- CPF Refunds: You must return all CPF funds used for the purchase, including accrued interest
- Loan Restructuring Penalties: May apply if you’re breaking an existing mortgage lock-in period
Should You Always Decouple?
No. While the tax savings are attractive, decoupling isn’t for everyone. It depends on your financial situation, estate planning, and long-term goals.
You Should Not Decouple If:
- You do not qualify for a mortgage on your own as a sole owner
- You’re nearing retirement and want to keep CPF funds liquid
- You plan to gift or transfer property in your Will, which may be disrupted if ownership changes
- You have significant estate planning concerns (especially with children or elderly dependents)
Our team also offers advisory for Wills, Letters of Administration, and LPA to ensure your decisions are legally sound and future-proof.
Legal Documents You’ll Need for Decoupling
- Valuation Report from a licensed valuer
- Sale & Purchase Agreement
- CPF Withdrawal/Refund Forms
- IRAS Stamp Duty Filing
- Mortgage discharge/restructure documents (if applicable)
It’s highly recommended to work with a property lawyer with experience in family-related conveyancing, as these transactions often touch both property and family law.
Visit our Our Team page to meet our cross-disciplinary legal experts.
Need Help With Decoupling? Speak to a Lawyer Today
Every decoupling case is unique. Before you proceed, get clear legal advice tailored to your financial and estate planning needs.
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Frequently Asked Questions (FAQ)
What does decoupling property mean in Singapore?
It’s a legal process where one co-owner transfers their share of a property to the other, often used to avoid paying ABSD when buying a second property
Is decoupling property always worth it?
Not always. While it can save ABSD, it also comes with legal costs, CPF refund obligations, and possible mortgage complications. You should always consult a lawyer first.
Can I decouple my HDB flat?
No, decoupling is only applicable to private properties. HDB flats cannot be decoupled due to HDB’s joint ownership policies and eligibility restrictions.