Marketing Commercial, Industrial & Conservation Properties

Commercial property: GST, no ABSD, and open to foreigners

Commercial property covers offices, retail units, and commercial shophouses. Three features set it apart from residential. First, GST is generally chargeable on the sale or lease of commercial property where the seller/landlord is GST-registered — commercial property is a taxable supply, unlike the sale/lease of residential property which is GST-exempt. Second, Additional Buyer's Stamp Duty (ABSD) does not apply to commercial property; it targets residential purchases only. Third, because commercial property falls outside the Residential Property Act, foreigners may buy it freely without needing government approval. Commercial assets are also valued largely on rental yield and net income rather than owner-occupier sentiment. The standard GST rate is 9% from 1 Jan 2024 (IRAS), so a $3m shop from a GST-registered seller carries $270,000 of GST on top of the price.

The shophouse trap: part of a "commercial" building can be residential

Read that ABSD row carefully before you apply it to a shophouse. "Commercial" is a use, not a shape of building, and many shophouses are mixed-use — a shop on the ground floor with residential accommodation on the upper floors. The residential part does not stop being residential because the listing calls the whole building a commercial shophouse. On a mixed-use purchase BSD is apportioned between the residential and non-residential portions, each on its own ladder, and ABSD is payable on the residential portion at the buyer's applicable rate — the very duty this page has just told you does not touch commercial property. A client who budgets like a pure commercial buyer and then meets an ABSD bill on half the building has been badly advised.

So the question is never what the building looks like, but what its approved use and zoning actually are — and that is checked with URA for the specific address, not assumed from the street. The same caution applies before you tell a foreign buyer that no approval is needed: the Residential Property Act reaches residential property, so a shophouse with an approved residential component is not automatically outside it. Establish the approved use first; the duty treatment and the foreign-ownership answer follow from it. HDB takes the same view: for flat eligibility, a mixed-use property or a shophouse with a residential component counts as private residential property (HDB, Couples and Families page, updated 23 Aug 2026). A client who owns a shophouse with living quarters faces the 30-month wait-out before a subsidised HDB purchase.