Up to 4% in rent relief

Source : Straits Times - 24 Jan 2009

IF PRIVATE landlords pass on the property tax rebate, then tenants can look forward to an estimated 4 per cent adjustment in rents, said president of the Association of Small and Medium Enterprises Lawrence Leow.

He explains:

The amount of property tax a landlord has to pay amounts to 10 per cent of the gross rental amount they collect per year. This amount is also called the annual value of their property.

For example, if a mall’s annual value is assessed at $120,000 a year, the landlord will have to pay $12,000 in property tax a year (10 per cent of $120,000).

A 40 per cent rebate, amounting to savings of $4,800, means the landlord pays only $7,200.

The savings, of $4,800, accounts for 4 per cent of the annual value.