Decoupling to beat the ABSD: How it works and finding a lawyer

Last updated on December 7, 2025

Property buyers and investors are well aware that on top of the basic Buyer’s Stamp Duty (BSD) payable on the purchase of a residential property, Additional Buyer’s Stamp Duty (ABSD) is also payable if you already own another residential property or you are not a Singapore citizen. This can add up to quite a hefty sum, and greatly reduces the profits which you may have been looking to receive from your property investment.

How can you then plan your property purchases to minimise the amount which you may have to pay in taxes? In this article, we will give you pointers on how smart planning by a typical married couple can reduce ABSD liability.

Purpose of ABSD

ABSD was introduced in 2011 as part of a slew of property cooling measures in the face of rising property prices amid strong investment demand by both local and foreign buyers of residential property. Its aim is to stabilise the property market and ensure that prices do not increase or fluctuate drastically.

Decoupling Overview

The theory behind “decoupling” is simple. It means removing one co-owner’s name from the title of a property. The co-owner whose name has been removed can then buy another residential property without having to pay ABSD.

First off, decoupling the ownership of Housing Development Board flats is not possible because the Housing Development Board (HDB) revised its regulations on 1 April 2016 to restrict the transfer of flat ownership. Flat owners will only be allowed to transfer the ownership of their flats under six circumstances including marriage, divorce, death of an owner, financial hardship, renunciation of citizenship and medical reasons. All other reasons will be assessed by HDB on a case by case basis.

The first method for decoupling is to transfer ownership through a Sale and Purchase.

Transfer of ownership through a Sale and Purchase

This works exactly the same way as a normal sale and purchase. A sale and purchase agreement will have to be signed by the parties, and the agreement will have to be stamped. The spouse taking over the ownership can apply for a housing loan to finance the purchase. It has to be a genuine sale at fair market value.

Stamp duties: Stamp duties have to be paid within 14 days of the execution of the sale and purchase agreement. BSD will have to be paid, based on the purchase price (or the market value, whichever is higher) of the share of the property being transferred. If the property was purchased less than 3 or 4 years ago(for properties purchased after 4 July 2025), then Spouse B will also have to pay Seller’s Stamp Duty (SSD). Again, what is payable is also on the portion of the property being sold (i.e. if Spouse A is buying over 1% of the property from Spouse B, then what is payable is on the market value of that 1%).

Refund of CPF monies: All CPF monies used by Spouse B towards the purchase of the property will have to be refunded to his/her CPF account together with accrued interest upon completion of the sale. Your lawyer will also have to help you apply for a partial discharge of the CPF Board’s charge over your house, such that Spouse B’s name is removed. The refund of CPF monies can usually be completed within 10 working days of the sale, freeing up Spouse B’s CPF funds for the purchase of a new property.

Restructuring and refinancing of bank loan: If you financed the purchase of your property with a bank loan, you will need to speak to your banker about restructuring or refinancing of your home loan. This will typically involve removing Spouse B’s name from the loan, and may involve early mortgage redemption.

If you are looking to refinance with a different bank, you may read our article on some tips and pointers when refinancing your home loan. If you are looking to complete your part-purchase within a shorter period of time, it may be easier to refinance with your existing bank, as they are more likely to allow for a shorter notice period for redemption of your existing loan if your new loan is also with them.

Similar to a normal refinancing process, your lawyers will also assist you in discharging the existing mortgage for the old loan and lodging the mortgage for your new loan.

Transfer of ownership by way of gift

Where the circumstances allow, parties can also transfer the part-ownership in the property by way of gift. There has to be no outstanding mortgage, and any CPF funds used have to be refunded before the transaction can proceed.

Buyer’s stamp duty, additional buyer’s stamp duty (where applicable), and seller’s stamp duty (where applicable), are payable for the transaction despite it being a gift. The duties are calculated based on the market value being transferred, or the agreed purchase price, whichever is higher. A professional valuation for the share of property being transferred has to be obtained.

While a transfer of ownership can also be effected by way of a gift by Spouse B to Spouse A of his/her share, it may be preferable to go through with a sale and purchase instead. This is because a share ownership that has been transferred by way of gift may be set aside as a transaction at an undervalue in the event of bankruptcy of the gifting party within 3 years of the gift. This may have negative implications for the owner looking to sell the property, as it may be more difficult for the potential buyer to obtain a bank loan.

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Is the 99-to-1 ownership scheme legal?

The main problem with decoupling a property usually lies in financing the “second” property. If only one party is buying the property, then only the income of this party is considered when obtaining the housing loan. Usually, it’s not enough to afford the property.

In recent years, there was a “workaround” where the spouse would buy the second property, and then within a week or so, sell 1 percent of the property to the spouse who already owned another property. Now, the spouse who already owned another property will pay stamp duties on only that 1% share (as opposed to higher percentage share like 50% if the parties had chosen to hold in equal shares). They would hold the property as tenants-in-common in a 99-1 split and would both qualify for the housing loan.

There is also another less common scenario where the 99-1 split applies. It is where parties hold a property in this ownership structure in anticipation of decoupling and buying a second property. Transferring a 1% share is less costly than transferring a 50% share where stamp duties are concerned.

The Inland Revenue Authority of Singapore (IRAS) has since started cracking down on such arrangements. Where such transactions are found to be solely for the purpose of tax avoidance, IRAS will recover the rightful amount of ABSD, and may impose a surcharge.

Implications of Arrangement in the Event of Divorce or Death

Buying a property as tenants-in-common, as opposed to buying as joint tenants, has implications on inheritance. Buyers who decide on an unequal ownership, such as a 99%-1% tenancy-in-common, may also be concerned about how their property will be divided in the event of a divorce.

As tenants-in-common, the rule of survivorship does not apply. This means that when one of the owners pass on, his or her share will be distributed either according to his or her will, or according to the Intestate Succession Act. This is in contrast to a joint tenancy, where the survivor will by operation of law take ownership of the whole interest in the property.

In the event of a divorce, the court will consider all the circumstances of the case before deciding on the division of the property. The court is not bound to divide based on strict legal ownership. You can learn more in our article on how the court divides matrimonial assets.