Author Archives: singaporedevelopersalesuser





•What is part purchase / decoupling?
• Stamp duty in respect of part purchase / decoupling
• Buyer’s Stamp Duty and Additional Buyer’s Stamp Duty
• Seller’s Stamp Duty
• Procedure
• Potential PitfallsWhat is Part Purchase / Decoupling?

What is Part Purchase / Decoupling?
• A part purchase is where there are multiple owners to a property, and
one of the owners buys over the share of the other owner(s)
• Decoupling is where there is a husband-wife relationship between the
two owners of the property, hence “de-couple-ing”
• Decoupling is essentially a specific form of part purchaseStamp Duty in a
Part Purchase / DecouplingStamp Duty: Same Rules Apply
Stamp duty is payable in a part purchase; the same rules apply. The
stamp duty (including Buyer’s Stamp Duty, Additional Buyer’s Stamp
Duty and Seller’s Stamp Duty) is determined by:-
• The valuation price; and
• The share in the property transferred
NB: Stamp duty is payable even for transfers by way of a giftProcedureProcedure: Encumbrances
CPF monies
• If CPF monies were used in the purchase, it needs to be refunded to
the CPF account of the seller/transfer or existing mortgage
• As banks usually require notice of 3 months for redemption, interest
in lieu of notice usually needs to be paid
• To decide completion date carefully as there may be pre-payment
penalties involved

Procedure: Timelines
Drafting of Sale and Purchase Agreement (around 3 days). We require:-
• NRICs/ Passports of all parties;
• Address of property; and
• Valuation report
• If bank loan and/or CPF funds are required to buy over the share: 8 to 12
• If no bank loan and no CPF funds are required to buy over the share: 2
weeks (the purchaser must have the funds to pay for 95% of the share)Procedure:
Other things to note
How much deposit needs to be paid?
• Usually 5% of the purchase price
• May be paid directly to the seller without going through the lawyers
When can the seller purchase another property (for the purposes of ABSD)?
• The date of the S&P is the date that the seller is deemed to have sold the
property. Thus, upon signing the S&P, he can go ahead and purchase
another property
• However, if the seller is using CPF funds to finance the new purchase, then
completion of the part purchase must take place at least 3 weeks before
payment of CPF for new purchase (e.g. either for 15% in BUC, or


Potential Pitfalls
There are a few issues to consider when de-coupling:-
• Bankruptcy
• Divorce of married couple

Potential Pitfalls:
Bankruptcy Issue
Under the Bankruptcy Act, if:-
• an individual enters into a transaction at an undervalue, or if he makes a gift (section 98)
• for a 5 year period (section 100)
• the transaction is declared null and void (for undervalue transactions), or the gift vests in
the Official Assignee (for gifts) (section 102)
• should the individual subsequently become a bankrupt
Therefore, such transactions should always be done at actual value based on a valuation
report done by an established valuer (i.e. cannot pay a valuer to value the property at a
lower figure).
If transfer is by way of a gift, it would be difficult to find potential buyers within the first 5

Potential Pitfalls:
• Many married couples make use of decoupling as a way to avoid paying
• Example:
• Husband and wife own one property
• Wife transfers her share to husband
• Wife purchases a new property, and does not have to pay ABSD (as the new property
would be her first property)
• Problems may arise in the case of divorce
• Wife will argue that both properties are matrimonial assets
• Husband will argue that he paid wife fully, and first property belongs to him fully
• Still possible, but important to advise clients on this potential issue


Vivien Mok
H/P: 90628592



• What is a Trust?
• Who can be a Trustee?
• Who can be the Beneficiary?
• Requirements of a valid Trust
• Powers and Duties of a Trustee
• Consequences of Breaching the Trust
• Procedure
• Scenarios

What is a Trust? What is a Trust?
• A legal arrangement that allows someone (known as the Trustee)
to hold a property for the benefit of another person (known as the
• Thus, the parents (legal owners) purchase the property and hold it
for the benefit of the child (the beneficial owner)
• Since the child has no existing property, no ABSD is payable
• “The Trustee declares that he holds the Property in trust for (name) (“the
Beneficiary”) and agrees that he will convey the Property to the Beneficiary
(upon the occurrence of an event).”

Who can be a Trustee? Who can be a Trustee?
• Anyone not incapacitated from holding title to a property can be a
• I.e. a Trustee must be at least 21 years old and of sound mind
• No limit as to the number of trustees who may be appointed to a
• Trustee(s) can only deal with the property in accordance with
their powers and duties as set out in a legal document known as
the Trust Deed / Declaration of Trust. Otherwise, they can be sued
for a breach of trust.
Who can be the Beneficiary? Who can be the Beneficiary?
• Anyone can be the Beneficiary of a Trust
• No age limit Creation of Trust

How is a Trust formed?

By way of Trust Deed / Declaration of Trust, which is a formal document that outlines the duties and powers of the Trustee.

Requirements of a Valid Trust Requirements of a Valid Trust
Formalities: Trust documents must be in WRITING
• Civil Law Act, s 7(1): “A declaration of trust respecting any
immovable property or any interest in such property must be
manifested and proved by some writing signed by some person
who is able to declare such trust or by his will.”

• Civil Law Act, s 7(2): “A disposition of an equitable interest or trust
subsisting at the time of the disposition must be in writing signed
by the person disposing of the same or by his agent lawfully
authorized in writing or by will.” Requirements of a Valid Trust
Formalities: Trust documents must be in WRITING
• Conveyancing and Law of Property Act, s 53(1): “A conveyance of
any estate or interest in land other than a lease for a period not
exceeding 7 years at a rack rent shall be void unless it is by deed in
the English language.”

• Creator of the trust must have capacity to hold property
Powers and Duties of a Trustee Powers of a Trustee
• The default powers of a Trustee are governed by the Trustees Act
and they apply unless expressly excluded in the Trust Document
• Under the Act, a Trustee is empowered to make any kind of
investment with the trust assets as long as he obtains and
considers proper advice and carry out periodic review
• E.g. If the property market is booming, Trustee may sell the Trust
Property and put the sale proceeds in other forms of investment,
so long as he ensures that the Beneficiary’s interest is protected. Duties of a Trustee
• To take reasonable care in making investment with trust assets
• To act fairly between Beneficiaries (where there is more than one
• To comply with the terms set out in the Trust Document
• To provide information and accounts to the Beneficiaries when
• Not to make a secret profit from the Trust Consequence of Breaching the Trust Breach of Fiduciary Duty and Duty of Care
• If the Trustee fails to perform his powers and duties under the
Trust , the Beneficiary may bring a civil suit against him for breach
of duty.

• Beneficiary may claim for specific performance (i.e. to force the
Trustee to perform his duties under the Trust) or damages (i.e. to
recover from Trustee any losses due to his mismanagement of
trust assets) Criminal Breach of Trust
• Penal Code, s 405: When a Trustee, entrusted with a property,
dishonestly misappropriate or converts to his own use that
property, or dishonestly uses or disposes of that property in
violation of law or of the Trust Document, commits a criminal
breach of trust

• When Trustee commits a criminal breach of trust, he shall be
punished with imprisonment for a term which may extend to 7
years, or with fine, or both. Procedure Procedure
• Parents purchase the property, and execute a trust document,
declaring that they hold the property on trust for the child
• Trust document must be stamped (stamp fees of $10)

• The interest of the child must be registered
• Lodge caveat on behalf of child against the property

• Upon the occurrence of an event (e.g. the child turns 21), the
parents transfer the property to the child

Scenarios Scenarios
• We have received a number of queries regarding whether it is
possible for a parent to “purchase a property in their child’s name”
in order to avoid paying ABSD
• E.g. Parents own one existing property. If they purchase a second
property, they would have to pay 7% ABSD. However, their child does not
own any property, so if they could “purchase the property in their child’s
name”, ABSD is not payable

• What exactly does “purchase a property in their child’s name”

“Purchase a property in the child’s name”?
• Child is the purchaser, while parents finance the property


• Parents purchase the property on trust for the child

Child is the Purchaser: Issues
• A child below 21 does not have legal capacity to buy a property
• Only possible if the child is aged 21 or above

• From 29 June 2013, borrowers must also be mortgagors
• Unless the child has the financial means to obtain a loan, the property has
to be paid in full cash

(Note: This is not a trust arrangement)
Child is the Purchaser: Issues
How can the parents’ interests be protected?

• What if the child keeps the property for himself?
• The child can execute a Power of Attorney in order to empower the parents to
deal with the property (renewable every 6 years)

• What if the child passes away?
• The child can execute a will and bequeath the property to his parents (no ABSD
payable for properties acquired via inheritance)

However, do note that the parents’ interests can never be fully protected.
E.g. the child becomes bankrupt.

Parents purchase the property on trust for the child
• If the child is below 21, the only way is for the parents to purchase
the property on trust for the child

• The parents purchasing the property on trust for their child
cannot use their CPF funds
• CPF funds can only be used for the purchase of your own property

• The parents will not be able to obtain a loan to finance the
• This is because the parents are only the legal owner, whereas the child is
the beneficial owner.
Vivien Mok
H/P: 90628592

Australian Property Myths

Myth No. 1    Hit with Ball
“Resale property can only be sold to locals?”
Resale property can be sold to all residents including Aussie, PRs, students and all other resident Visa holders. This group of people actually forms up 90% of its Australian property buyers.

Myth No. 2    Hit with BallHit with Brick
“There is an oversupply currently.”
Current population growth at an estimate rate of 400,000 per year with a NOM of 60% which means, 240,000 people need a ready home to live in almost immediately.

Myth No. 3  Hit with BallHit with BrickHit with Ball
“It is difficult to get financing.”
Did you know you can get up to 80% LTV and there is no age limit imposed? Besides, you can opt for Interest Only Loan with the lowest possible rate ever?

Myth No. 4  Hit with BallHit with BrickHit with BallHit with Brick
“You need a lot of capital upfront.”
Did you know there are a lot of good buys still & you only require a 10% down payment while the balance can be deferred until its completion?

Myth No. 5  Hit with BallHit with BrickHit with BallHit with BrickHit with Ball
“Its too far away and nobody is there to help manage them.”
HUTTONS provide a ONE-STOP service where we introduce to you:
a) Lawyer who takes care of all your needs and interest 
b) Loan Mortgage broker who represents most of onshare banks
c) A Tax Consultant to assist to reduce all your Tax burdens
d) A lease and management to assist in managing your property

I Surrender!HURRY!I Surrender!
Call Vivien 90628592 now!