AV is derived from market rentals of comparable properties, not from a specific unit's own lease, and IRAS reviews it periodically as the rental market moves, which is why a property tax bill can change even without any change of ownership or use.
Property tax is a progressive rate applied to the AV, and the first S$12,000 of AV on an owner occupied residential property is taxed at 0 percent, with higher, progressively steeper rates on the remainder. Non owner occupied property, including investment units, is taxed at a separate, higher rate schedule.
Because AV drives both the tax bill and, indirectly, a sense of a unit's rental potential, checking a property's current AV on the IRAS portal is a useful, low effort step when assessing an investment purchase, though AV should never be mistaken for an actual achievable rent.
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Book a free 30 minute callWinfred Quek is an Associate Marketing Consultant at Crestbrick Pte Ltd (CEA Licence No. L31010886H). CEA R073319H. This page is for general information only and does not constitute financial, investment, or legal advice. Verify current figures with IRAS, HDB, CPF Board, or MAS before making any decision.