Renting out your HDB flat or condo sounds simple — sign a tenancy agreement, collect a monthly transfer, repeat. Then April rolls around, and the IRAS e-filing portal asks you to declare your net rental income. Suddenly you are wrestling with deductible mortgage interest, the 15% deemed-expense option, what counts as “repairs” versus “improvements”, and whether your S$420 monthly MCST bill is a write-off (it is). Get it wrong by a thousand dollars in either direction, and the result is either a real cash tax overpayment, or an IRAS query letter you do not want to receive.

This guide walks you through how rental income is taxed in Singapore in 2026, what the IRAS rules actually say, the two paths you can choose between for expense deductions, and a fully-worked example using realistic 2026 numbers for a typical leveraged condo investor. By the end you should be able to fire up your IRAS Income Tax e-Filing screen, key in Total Annual Rent, Allowable Expenses and Net Rental Income, and be confident the numbers reconcile to your actual cashflow.

What “Rental Income” Means for IRAS Purposes

Under section 10(1)(f) of the Income Tax Act 1947, “rents” derived from any property in Singapore are chargeable to tax. The Comptroller of Income Tax interprets this broadly: it covers the basic monthly rent, anything else the tenant pays you under the tenancy agreement, and certain non-cash benefits.

What goes into your gross rent figure on your tax return:

Monthly rent — the headline figure on the tenancy agreement.

Furniture and fittings rent — if your tenant pays a separate fee for furnishings, it is rent.

Maintenance fees billed to the tenant if they pass through you (uncommon but valid).

Compensation for early termination of the lease (if not specifically structured as damages).

Any non-refundable lease premium received.

What is not rental income: the tenant’s security deposit while you still hold it (you owe it back), and any reimbursement of utility bills paid by the tenant directly to SP Group, M1, etc. Forfeited security deposits, however, do count as rental income at the time of forfeiture.

How Rental Income Is Taxed: The Marginal-Rate Mechanic

Singapore does not have a separate “rental tax” or a flat rate on rental income. Instead, your net rental income — gross rent less allowable expenses — is added to all your other taxable income (employment income, trade or self-employment profits, interest, royalties) and taxed at the resident progressive rates.

The same rental property therefore generates very different tax outcomes for two landlords. A retired SC with no employment income may pay almost no tax on a S$60,000 gross rent year, while a senior professional earning S$250,000 from employment can lose 19-22% of every dollar of net rent to the marginal-rate stack. This is why high-income Singaporean landlords often plan property purchases under the lower-earning spouse’s name — a perfectly legitimate (though ABSD-sensitive) way to lower household tax.

What You Can Deduct: The Two Paths

Once you have your gross rent, IRAS lets you choose between two paths to compute net rental income. The choice is made property by property on each year’s filing — there is no lock-in.

Path 1: Actual qualifying expenses

You add up every expense incurred wholly and exclusively in earning the rent during the year and deduct it from gross rent. Required to keep receipts and supporting documentation for 5 years (IRAS Income Tax Records Keeping Requirement). The full list of typical deductible items:

Property tax on the tenanted unit (non-owner-occupier rate, 12-36% of AV in 2026).

Mortgage loan interest — the interest portion of every monthly instalment. The principal repayment portion is not deductible.

Fire / building insurance premiums.

MCST monthly fees (maintenance + sinking-fund contributions) for the period of letting.

Repairs and maintenance — like-for-like fixes only. Replacing a broken aircon compressor is repair; replacing the entire aircon system with a higher-end model is partly improvement (not deductible).

Agent commission on lease procurement (typically 0.5-1 month of rent + GST). The first-tenancy commission may be partly disallowable; subsequent commissions are fully deductible.

Stamp duty on the tenancy agreement — if landlord has agreed to bear it (rare; usually tenant pays).

Vacancy-period utilities and SP Services when paid directly by the landlord.

Routine cleaning, pest control, gardening attributable to the unit during letting.

Path 2: 15% deemed expense + mortgage interest

From YA 2017 onwards, IRAS allows residential-property landlords to claim a flat 15% deemed deduction on gross rent in lieu of itemising actual expenses, plus their actual mortgage interest. No receipts are needed for the 15% portion.

This is a real shortcut for low-cost landlords. If you own a HDB flat free-and-clear (no mortgage interest), with low MCST and minimal repairs, your actual qualifying expenses might be 8-12% of rent — the 15% path delivers a higher deduction, with no admin. For leveraged condo landlords, by contrast, mortgage interest alone often runs 50-70% of rent; the actual-expense path almost always wins.

Important: the 15% deemed-expense path is only available for residential property let to a tenant who occupies the unit. Commercial property landlords, AirBnB-style serviced-apartment hosts, and corporate-structured property trusts cannot use it.

Property Tax for Tenanted Units

The instant your property is rented out, IRAS automatically reclassifies it from owner-occupied to non-owner-occupied (NOO). The tax rate ladder differs sharply:

Owner-occupier rates: 0% on the first S$8,000 of AV, rising progressively to 32% on AV above S$100,000.

Non-owner-occupier rates: 12% on the first S$30,000 of AV, rising to 36% above S$60,000 AV in 2026.

Joint Owners and Couples

For jointly-held properties, IRAS apportions rental income and deductions equally by default among co-owners, regardless of who actually pays the mortgage or collects the rent. If you want a different split (e.g. 70/30 to reflect actual capital contributions or beneficial ownership), you must file a declaration of beneficial interest and IRAS may ask for evidence.

This is the heart of the Singapore tax-planning playbook for couples: where one spouse earns in the top marginal bracket and the other earns less, splitting the rental income via a 50/50 joint-tenancy or a deliberately-skewed tenancy-in-common can lower household tax materially.

Vacancy, Mid-Year Letting, and Voids

When you let your property only for part of the year, only the rent received is taxable, and only the expenses attributable to the letting period are deductible (pro-rated).

Common scenarios:

Owner moves overseas mid-year and rents out from August. Pro-rate the property tax (NOO rate from 1 August), MCST fees, and insurance from August onwards. Mortgage interest is fully deductible against rent because the loan continues throughout, but only the August-December portion is matched against the August-December rent.

Tenant moves out, unit vacant for 2 months, new tenant moves in. Vacancy-period expenses (utilities, MCST, mortgage interest) are still deductible if the property was actively marketed for re-letting during the void.

Property partly let, partly self-occupied. Only the let portion’s expenses are deductible; the personal-occupation portion is not. Apportion strictly by floor area and time.

What Might Come Next: Rental Tax Watchpoints

The basic IRAS framework has been stable since the 15% deemed-expense option was introduced in YA 2017. Two areas to watch in 2026:

Short-term let crackdown. URA’s 3-month minimum residential let rule is now policed more aggressively. AirBnB-style sub-3-month lets are not legal residential lettings and may also be reclassified as a trade by IRAS, attracting higher tax and disqualifying the 15% deemed path.

NOO property-tax escalation. The NOO rate ladder has steepened in each Budget since 2022 (peak rate raised from 27% to 36% over three years). Investors should model continuing escalation when underwriting yield.

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