Guide · 2026
ABSD trust structures: the 65% rate explained
By Winfred Quek · 9-minute read · Last reviewed May 2026
Facts verified: May 2026 · Sources linked below
Key Takeaways
- • Buying residential property on trust triggers a flat 65% ABSD, payable upfront at stamping.
- • A remission can reduce the 65% to the beneficiary's individual ABSD rate where the trust has identifiable individual beneficiaries.
- • A child with no other property may end up at 0% ABSD after the remission, but the 65% cash is needed first.
- • The beneficiaries must be named and identifiable at the time of purchase. Discretionary trusts do not qualify for the remission.
- • The remission application has a deadline. Miss it and the 65% becomes a permanent cost.
The trust route is one of the most misunderstood corners of Singapore property. People hear that a parent can buy a property "for the children" and assume it is a clever way around ABSD. It is not a way around anything. It is a fully taxed transaction with a specific, conditional refund mechanism, and if the conditions are not met, the 65% rate is real money gone.
This piece explains why the 65% applies, how the remission brings it down, and the one scenario where the structure genuinely makes sense: legitimate intergenerational planning for a named child.
Why does property bought on trust attract 65% ABSD?
Since May 2022, IRAS has imposed a 65% ABSD, known as ABSD (Trust), whenever residential property is transferred into a living trust. According to IRAS, this applies regardless of whether the trust has identifiable beneficial owners at the point of purchase.
The reason for the rule is straightforward. Before 2022, a property held on trust for a beneficiary, particularly a young child, did not always have a clear chargeable person for ABSD purposes. That created a gap. By charging a flat 65% on every trust purchase upfront, IRAS closed the gap: the duty is collected first, and any reduction has to be actively claimed back.
So the 65% is not a penalty aimed at trusts as such. It is a default rate that ensures duty is paid, with the genuine cases then routed through a remission. The burden of proof sits with the buyer to demonstrate the trust qualifies for relief.
| Buyer | ABSD treatment |
|---|---|
| Individual (own name) | 0% / 20% / 30% by profile and count (SC); 5% / 30% (PR); 60% (foreigner) |
| Company or entity | 65% flat |
| Trust (residential property) | 65% upfront, remission to individual rate where conditions met |
ABSD treatment by buyer type, 2026. Confirm the current position with IRAS before any trust purchase.
How does the trust ABSD remission work?
The 65% is not necessarily the final cost. According to IRAS, where a residential property is acquired by a trust with identifiable individual beneficial owners, a remission can be claimed so that the ABSD paid is reduced to the amount that would have applied if the property had been bought directly by the beneficial owner.
The remission is conditional. All of the following must hold:
- The beneficial owners are identifiable individuals. Named, specific people, not a class such as "my future grandchildren".
- Each beneficial owner is identified at the time the property is purchased. You cannot name them later to fix a defective structure.
- The trust is not a discretionary trust. If the trustee has discretion over who benefits, there is no fixed beneficial owner, and the remission is unavailable.
- The beneficial interest is held absolutely for the named individuals.
Where the conditions are met, the ABSD is recomputed at the beneficiary's own profile. The difference between the 65% paid and the beneficiary's individual rate is refunded.
The living-trust-for-a-child scenario
The legitimate use case, and the one I am occasionally asked about by family-office clients, is a parent buying a residential property in trust for a young child who is a Singapore Citizen.
Why would a family do this rather than simply buying in the parent's own name? Usually one of two reasons. First, intergenerational planning, the parent wants the asset to belong to the child from the outset, so it does not need to be transferred later (a later transfer would itself be a stamp-duty event). Second, ABSD count management, if the parent already owns property, buying another in their own name would be a second or third purchase at 20% or 30%. Buying in trust for a child who owns nothing routes the eventual rate through the child's clean count.
Worked through with the verified rates, for a $1.5M residential property:
| Route | ABSD at stamping | ABSD after remission / final |
|---|---|---|
| Parent (owns 1 property) buys in own name | 20% = $300,000 | $300,000 (no remission) |
| Trust for child (child owns nothing, SC) | 65% = $975,000 | 0% after remission, full $975,000 refundable |
Illustrative 2026 figures for a $1.5M residential property. Outcomes depend on meeting all remission conditions. Confirm with IRAS and a qualified lawyer.
On paper the trust route saves the $300,000 of ABSD the parent would otherwise pay. But it demands $975,000 of upfront liquidity, careful legal drafting, and a properly constituted non-discretionary trust naming the child. It is a planning tool for families with real surplus capital, not a shortcut.
Winfred's Take
The trust route is not a hack, and anyone selling it as one should be treated with caution. It is a legitimate intergenerational planning structure with a real cost, the time value of locking up six figures or more between paying the 65% and getting the remission, and a real failure mode, a defectively drafted or discretionary trust that does not qualify for relief. I only see it make sense for families who genuinely want a named child to own an asset outright and who have the liquidity to pre-fund the 65% comfortably. If the structure is being reverse-engineered purely to cut ABSD, the saving rarely justifies the cost and the legal risk. Get a private-client lawyer to draft the trust before any property is identified.
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Winfred Quek · CEA R073319H · Crestbrick
Frequently asked questions
Is the 65% ABSD on trusts always refundable?
No. The remission only applies where the trust has identifiable individual beneficial owners named at the time of purchase. A discretionary trust, or one with no fixed beneficiary, does not qualify, and the 65% is then a permanent cost.
Can a foreigner buy property in trust for a child to avoid the 60% rate?
The remission recomputes ABSD at the beneficiary's individual rate. If the beneficiary is a foreigner, the individual rate is 60%, so there is no advantage. The structure helps only where the named beneficiary genuinely has a lower individual rate.
How long do I have to claim the trust ABSD remission?
The remission must be applied for within the timeframe set by IRAS. The window is not open-ended, and a missed deadline makes the 65% permanent. Confirm the current deadline with IRAS and engage your lawyer to file in time.
Does a property held on trust for a child count toward the child's future ABSD?
Where the child is the beneficial owner, that property is part of the child's property count. A later purchase by the child, or in trust for the child, would be assessed against that existing holding.
Can I set up a discretionary trust and still get a lower rate?
No. A discretionary trust has no fixed beneficial owner, so the ABSD (Trust) remission is not available. The flat 65% applies and is not reduced.
Sources & References
Winfred Quek is an Associate Marketing Consultant at Crestbrick Pte Ltd (CEA Licence L31010886H), advising Singapore upgraders, investors, and family offices. CEA R073319H. The information on this page is general and does not constitute financial, investment, tax, or legal advice.