Singapore's Tax-Free Trio: Inheritance, Gift, and Capital Gains

At a Glance

Inheritance and Gift Tax: Fully abolished since 2008; currently 0%.

Capital Gains Tax: Generally tax-exempt for investment gains from stocks, property, and crypto.

2025 Benefit: A 60% Personal Income Tax rebate (capped at SGD 200) is scheduled for the SG60 celebration.

When first moving to Singapore, many people worry about this. Every time we hear news about high inheritance or capital gains taxes back in Korea, many parents wonder how they can smartly take advantage of the tax benefits available here.

I remember being shocked by how different the tax system was when I first settled in Singapore. For parents planning to pass down assets to their children or looking into investments, Singapore's "Tax-Free Trio" policy is an irresistible advantage. Based on the latest information for 2025–2026, here is a summary of the practical tax benefits you should know.

Is it true that Inheritance and Gift Taxes are zero?

To get straight to the point: yes, that is correct. Singapore completely abolished Estate Duty (inheritance tax) for deaths occurring on or after February 15, 2008. Since there is also no gift tax, the tax paid to the state is $0, whether you transfer assets to your children during your lifetime or leave them as an inheritance.

Freedom of Asset Transfer: There is no obligation to even report taxes when gifting financial assets like cash, stocks, or gold to your children.
Note on Property Gifts: While there is no "gift tax" on real estate, "Stamp Duty" still applies. The recipient must pay Buyer’s Stamp Duty (BSD) and potentially Additional Buyer’s Stamp Duty (ABSD) based on the market value, so be sure to check this.
Comparison with Korea: While Korea’s top inheritance tax rate nears 50%, managing local assets as a Singapore resident makes the transfer of wealth much smoother.

Category	Singapore	South Korea (Reference)
Inheritance Tax Rate	0%	Up to 50%
Gift Tax Rate	0%	Up to 50%
Capital Gains Tax	Generally Exempt	Taxed by period/amount

Zero Capital Gains Tax, but "Traders" Beware

In Singapore, the government does not collect Capital Gains Tax on money earned from investing in stocks, real estate, or even cryptocurrency. If a stock you bought for SGD 100,000 grows to SGD 200,000, the entire profit is yours to keep.

Strength of Long-term Investment: If you buy a condo and sell it after holding it for more than 5 years, the capital gains are 100% tax-exempt.
Beware the "Badges of Trade": The Inland Revenue Authority of Singapore (IRAS) may consider frequent trading or short holding periods as "trading activity" rather than "investment." In such cases, profits could be taxed as income at rates up to 24%.
2026 Update: For companies, the tax exemption for gains on the disposal of ordinary shares (Section 13W) will be made permanent from 2026 and expanded to include relevant equity instruments like preferred shares, further improving the investment climate.

2025 Income Tax Rebates and Resident Benefits

While Singapore uses a progressive tax system for personal income, the rates are very low compared to Korea. In 2025, special benefits await as Singapore celebrates its 60th year of independence (SG60).

Income Tax Rebate: For the Year of Assessment 2025 (YA 2025), all tax residents will receive a 60% personal income tax rebate, capped at SGD 200.
Low Tax Brackets: There is no tax on the first SGD 20,000 of income, with rates between 2% and 24% applying thereafter.
Residency Criteria: You must stay in Singapore for at least 183 days in a calendar year to qualify for resident tax rates. If you are classified as a non-resident, a flat rate of 24% may apply, so it is important to manage your travel schedule.

Property Stamp Duty (ABSD): The Biggest Barrier for Foreigners

While there are many tax perks, the story changes when foreigners buy property in Singapore. There is no capital gains tax, but the "tax to enter" is very heavy.

60% ABSD for Foreigners: Currently, foreign nationals (including Koreans without PR/specific FTAs) buying residential property must pay 60% of the purchase price as Additional Buyer’s Stamp Duty (ABSD). To buy a SGD 2,000,000 condo, you would need to pay SGD 1,200,000 just in taxes.
Commercial Property Alternative: Fortunately, ABSD is 0% for commercial or industrial properties. This is why many people are now looking at offices or shophouses for investment purposes.

Key Takeaways for Parents (Pro-Tips)

The 183-Day Rule: Ensure you stay at least 183 days a year to enjoy resident benefits, including the income tax rebate and lower progressive rates.
Foreign Income Exemption: For individuals, remitting foreign income (like rental income or dividends from Korea) to Singapore is generally not taxed in Singapore.
Keep Documentation: Even though there is no capital gains tax, IRAS may investigate whether you are "trading." It is wise to keep records that prove your long-term investment intent.
Utilize Corporations: If you have significant assets, consider setting up a family office or corporation, which benefits from a 17% flat corporate tax rate and various tax incentives (such as the corporate income tax rebate of up to SGD 40,000 for YA 2025).