Why did Iras up property valuation one year later?

I REFER to Mr Ng Zhong Ren’s letter, ‘Why did Iras up property valuation one year later?’ (ST, Sept 29).

Mr Ng asked why Iras’ letter of June 18 was received by his lawyer only on July 17. Iras had, since October last year, been corresponding with the law firm that acted for him in the property transaction. Our letter of June 18 was thus sent to this same law firm. Iras was subsequently informed by another law firm that it had taken over the case and that it had received the said letter on July 17. We have since contacted Mr Ng and have followed up with him separately on this matter.

Property buyers are required to pay stamp duty based on the transacted price of the property or its market value, whichever is higher. Where Iras has assessed that the property value declared for stamping purposes is below the market value, it will determine the stamp duty based on market value at the date of the property transaction and recover the additional stamp duty from the buyer. The market value of the property is determined based on sales evidence of similar properties.

A property transaction may be selected for stamp-duty audit within six years from the date of transaction. The property buyer or his appointed lawyer will be required to submit relevant documents, such as the sales agreement, for verification and stamp-duty assessment. Mr Ng’s case was picked for adjudication as the property value declared for stamping was below the market.

Any objection by the property buyer on the valuation determined by Iras must be substantiated with supporting documents. Notwithstanding the objection, stamp duty has to be paid promptly in order to avoid any late-payment penalties.

Chin Li Fen (Ms)Assistant Commissioner Corporate Services Division Inland Revenue Authority of Singapore

Source : Straits Times - 6 Oct 2007