99/1 ownership of private properties. What it is all about?

Last Sunday, The Sunday Times reported this: “Probe into home buyers who used loopholes to avoid paying ABSD.” In the article, it mentions how some buyers purchase private residential properties via 99/1 ownership arrangement to dodge paying additional buyer stamp duty (ABSD).

In this video, I am going to share by paying lesser ABSD via such arrangements may potentially get buyers into trouble with the taxman. I am also going to share with you the legal way of working around this sales contract. There are also some conditions for this to work. Are you keen to find out more? Without further ado. Let’s jump straight into it.

99-1 Example

Let’s illustrate with an example, let’s say a Singaporean man wants to buy a second property for investment. He already owns a residential property and wants to own another private residential property but yet he is not willing to pay ABSD of 17%. For a million-dollar property, the ABSD will be $170,000. This excludes the usual buyer stamp duty.

Here, he ropes in his son for this purchase. His son who is above 21 years old, not working and does not own any property will initially be buying the property under his name as sole owner. He proceeds to pay the 5% down payment, exercises the option to purchase and pays the buyer stamp duty.

Weeks later, the son sells 1% of the shares of his property to his father. His father will then secure a housing loan together with the son for this purchase. The father will pay ABSD based on 1% value of the property which will work out to be $1,700 ($1 mil x 1% x 17%) as compared to $170,000 ($1 mil x 17%) if he had bought the property solely under his name. Hence, the father saves $168,300 on taxes ($170,000 – $1,700). 

These practices were common in recent years until IRAS recently started looking into these practices as reported in The Sunday Times article.

However, using 99/1 ownership arrangement to purchase properties is not legally wrong. The law does not stop people to own properties in any percentage of ownership but rather, against people to make use of loopholes to pay less tax.

Another 99-1 Example

To illustrate this, here’s another example.

Both husband and wife buy their first private property together. The couple has plans to own a second private residential property in the future. But they don’t have the financial means now, and neither do they wish to pay the 17% ABSD in the future. Hence, the wife proceeds to buy with 99% ownership and the husband will own the remaining 1% share. Both of them will jointly secure a loan with the bank.

Assuming 3 years later and coincidently after the SSD period, the husband strikes TOTO and win a million dollars. He wants to exit from his current property that is jointly owned with his wife. He will then proceed to “De-couple” from the current ownership by selling his 1% share to his wife. Since the wife already owns the 99% share. She will only need to pay buyer stamp duty for that 1% share of the property. This work out to be $100 ($1,000,000 x 1% x 1% = $100)

By doing so, the husband will no longer own any properties and he can buy his private property just like any first-time buyer. The difference is significant if they were to own their first property under a joint tenancy or tenancy in common under a 50/50 holding. If the husband sells his 50% share worth $500,000 to his wife, his wife will have to pay a buyer stamp duty of $9,600 for buying over the husband’s share ($1,000,000 x 50% x 3% – $5,400 = $9,600)

If the husband disposes of the property during the first three years, then seller stamp duty will apply and the husband will have to pay SSD based on the full 50% share.

Condition for De-Couple

The spouse that holds the 1% should preferably should not be using any CPF for the purchase. This is a written reply from CPF board. In the event of a part sale of your share of the property to your wife, you will be required to refund the full principal withdrawn for the property and the accrued interest to your OA. In short, you will need to refund the amount of CPF used fully in cash since it is a negative sales case.

Secondly, the income of the wife must also be strong to support the newly revised loan amount. Otherwise, she will need to top up the difference with cash. In an event of a messy divorce, the wife will own the 99% share. It will also be good to draft a will especially if you do not have any children. You can refer to my earlier video – Estate Planning – Have you planned for your loved ones?

De-coupling is mainly for those with very strong financial ability and wish to own another residential property down the road. This approach may not suit everyone. If you do not have plans to own another private property. Just stick with buying under joint tenancy for married couple.  

By the way, this 99/1 sales strategy is already smelly. Cannot use it already. Later you tell your friends you buy property using 99/1. They will say you want to cheap our government leh. You better not hor. You better buy either 98/2 or 97/3 or in any other combination instead. When you tell your friends you buy property either 98/2 or 97/3. Your friends will be like what? “What is that!” You can share with them that you learn from my video. Ok? Clap Clap Clap. 

Here, what about HDB flats? Can I de-couple my HDB flats and buy a private property? Sorry. You can’t anymore. The party has ended on 1 April 2016. Decoupling of HDB flats is only applicable to these 6 circumstances – marriage, divorce, death of an owner, financial hardship, renunciation of citizenship, and medical reasons.

In my sales career, I always hearsay couples get a divorce just to own 2 HDB flats. My personal thoughts are got so 要饭. If you want to own 2 HDB flats. Don’t even get married in the first place. At least you can change your life partner just like changing flats. Isn’t that even better?


In summary, it is legally not wrong to buy in any kind of shareholding manner. Just like it’s not legally wrong to buy under a child in trust as it’s not wrong to give the child a property. The fault comes when in a short period of time, the shares or property are disposed or transferred out to pay less ABSD. For the 99/1, the 1% share was transferred out after the option has been exercised, to save on the bulk of ABSD, which clearly shows evasion of tax

A popular misconception is when they see people doing it and nothing happens to them. They think it is right to do. Like what we learn in the army, you can do whatever you want, but just don’t get caught. For those that did it, I know it is not an easy time now. I humbly suggest writing in to IRAS to seek clarification. This will save you a lot of headaches and uncertainty. 


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