Answer
HDB Rental Income Tax — How Much Do You Pay? (2026)
Renting out your HDB? Good move for passive income. But IRAS wants their cut. Here's how rental income tax works, what you can deduct, and a worked example so you know exactly what to expect.
Answer: Rental income is taxable at your marginal income tax rate (0–24%). You can deduct mortgage interest (not principal), property tax, fire insurance, agent commission, and repairs. Net rental income after deductions is added to your other income for tax assessment. At a typical HDB rental of $2,500/month with $12,000/year in deductions, expect to pay roughly $1,680–$3,360 in additional tax per year.
What You Can (and Can't) Deduct
| Expense | Deductible? | Notes |
|---|---|---|
| Mortgage interest | Yes | Interest portion only, not principal |
| Property tax | Yes | Annual property tax paid to IRAS |
| Fire insurance | Yes | HDB fire insurance premium |
| Agent commission | Yes | One month rent, in the year incurred |
| Repairs & maintenance | Yes | Fixing leaks, aircon servicing, repainting |
| Furniture depreciation | Yes | Spread over useful life (typically 5–10 years) |
| Mortgage principal | No | You're paying down your own asset, not an expense |
| Renovation (improvement) | No | Only repairs, not upgrades or improvements |
| Personal living expenses | No | Utilities you use, your own furniture, etc. |
| Travel to property | No | Not deductible for individual landlords |
Worked Example — 4-Room HDB Whole Unit Rental
Renting out entire flat at $2,500/month
| Item | Annual Amount |
|---|---|
| Gross rental income | $30,000 |
| Less: Deductible Expenses | |
| Mortgage interest | −$6,000 |
| Property tax (non-owner-occupied rate) | −$2,280 |
| Fire insurance | −$300 |
| Agent commission (1 month) | −$2,500 |
| Repairs & maintenance | −$1,200 |
| Net rental income (taxable) | $17,720 |
This $17,720 gets added to your employment income. If your salary is $60,000/year, your total assessable income becomes $77,720, and you pay marginal tax on the rental portion.
How Much Extra Tax on $17,720 Rental Income?
Depends on your marginal tax bracket
| Your Total Income (with rental) | Marginal Rate | Extra Tax on $17,720 |
|---|---|---|
| Up to $40,000 | 3.5% | $620 |
| $40,001–$80,000 | 7% | $1,240 |
| $80,001–$120,000 | 11.5% | $2,038 |
| $120,001–$160,000 | 15% | $2,658 |
| $160,001–$200,000 | 18% | $3,190 |
| $200,001–$320,000 | 19% | $3,367 |
Simplified illustration. Actual tax depends on reliefs, rebates, and where the rental income lands across multiple brackets. Use IRAS tax calculator for exact figures.
Common Mistakes to Avoid
Deducting mortgage principal
Only the interest portion is deductible. If your monthly payment is $1,200, the interest might only be $500. Check your bank statement — it breaks this down.
Forgetting to switch to non-owner-occupied property tax rate
When you rent out your HDB, the property tax rate jumps from owner-occupied (0–16%) to non-owner-occupied (12–36%). IRAS will reassess. The higher property tax is deductible though.
Not declaring room rental income
Even room rental is taxable. IRAS can cross-reference with HDB's records of approved sublets. Not declaring it is tax evasion.
Claiming renovation as repairs
Replacing a broken tap = repair (deductible). Upgrading the whole kitchen = improvement (not deductible). The distinction matters.
Thinking about upgrading from your HDB?
See how your HDB sale proceeds, CPF refund, and income affect what condo you can afford. Full pipeline in 2 minutes.
FAQ
Do I need to pay tax on HDB rental income?
Yes. Rental income from renting out your HDB flat (whole unit or rooms) is taxable in Singapore. It’s added to your other income (salary, etc.) and taxed at your marginal income tax rate. You must declare it in your annual tax return under “Rent from Property.”
What expenses can I deduct from rental income?
You can deduct: mortgage interest (not principal repayment), property tax, fire insurance, agent commission (one-off, in the year incurred), maintenance and repairs, and cost of furniture/fittings (depreciated over useful life). You cannot deduct: mortgage principal, renovation costs that improve (not repair) the property, or personal expenses.
Can I deduct my HDB mortgage principal from rental income?
No. Only the interest portion of your mortgage payment is deductible. The principal repayment is not an expense — it’s you paying down your own asset. This is the most common mistake people make when calculating rental income tax.
What if my rental expenses exceed my rental income?
You can carry forward the rental loss to offset future rental income from the same property. However, you cannot use rental losses to offset your employment income or other income. The loss can only be used against future rental income.
Do I need to declare room rental income?
Yes. Even if you’re renting out just one room in your HDB flat, the rental income is taxable. You can still deduct a proportionate share of expenses (e.g., if you rent out 1 of 3 rooms, you can claim roughly 1/3 of the deductible expenses).
What is the tax rate on rental income in Singapore?
There’s no special tax rate for rental income. It’s added to your total assessable income and taxed at Singapore’s progressive resident tax rates: 0% on the first $20,000, then 2–24% on subsequent tiers. Your marginal rate depends on your combined income from all sources.
Related
Last updated Feb 2026. Tax rates based on IRAS YA2026 rates. Deductibility rules per IRAS guidelines. This is a tax guide, not tax advice — consult IRAS or a tax professional for your specific situation.