What is the Annual Value (AV) of the property?
A property’s Annual Value (AV) refers to the estimated annual rent that could be earned if the property was rented out, excluding maintenance costs and furniture.
The Inland Revenue Authority of Singapore (IRAS) determines a property’s AV. To make these estimates, IRAS considers various factors such as the property’s size, condition, location, other relevant physical characteristics, and the rentals of comparable properties nearby.
It is worth noting that a property’s AV is determined by IRAS’ assessment criteria and not the actual rent earned by the property. The AV remains the same whether the property is vacant, rented, or owner-occupied.
Why does IRAS use rentals rather than selling prices to calculate the Annual Value (AV)?
This is because there are usually more rental transactions than sales transactions, making it easier to obtain an accurate picture of market activity.
Rental price changes are also more predictable than sale price changes, which helps keep the property tax system more stable for property owners. Malaysia and Hong Kong also use a similar method to determine AV.
Additionally, it would be unfair to subsequent property owners to base AV on prior purchase prices, as costs of similar properties can change over time. This means newer property owners may have a higher AV if property prices rise.
How to check the Annual Value (AV) of my property?
Property owners can use IRAS’ View Property Portfolio e-Service to check their AV for free.
Additionally, the Check Annual Value of Property tool, available for a fee of S$2.50 per lookup, can also be used to gauge the AV of any property in Singapore.
If you’re looking for another option, try out the 99 Property Value Tool to help you get an idea of how much your property is worth.
Recommended article: What is the Annual Value of a property and how do I check mine?
Why is the Annual Value (AV) important?
Essentially, AV helps to determine how much tax you need to pay for your property.
If your property has a higher AV, you must pay more property tax. However, if you live on your property, you may pay a lower tax rate.
When will IRAS update my property’s Annual Value (AV)?
IRAS checks the AV of properties each year to see if there are changes in the rental values of similar properties in the market.
The AV will be amended if the latest market rent data no longer supports your existing AV. If any changes are made to your property that could significantly affect its rental value, IRAS will adjust your AV from the change date.
Property owners will receive a Valuation Notice from IRAS, informing them of any AV changes, whether it has gone up or down, and when it will take effect.
