Beijing’s tax crackdown tests wealthy Chinese property buyers in Singapore

[SINGAPORE] China’s tightening grip on offshore wealth may be forcing wealthy Chinese to rethink how – and where – they hold their assets, with Singapore property bought under trust structures especially under scrutiny.

While the ultra-rich may now be recalculating their wealth routes, market watchers reckoned that Singapore’s safe haven status would continue to draw the wealthy amid changing geopolitics.

In late July, Beijing imposed a 20 per cent income tax on offshore trusts, long viewed as a grey area through which high-net-worth individuals have been harbouring wealth. The stepped up efforts to enforce taxes on offshore income and gains made by Chinese tax residents have also stoked concern that the authorities could broaden their tax net further and deter investment.  

Chinese buyers have staked a sizeable presence in Singapore real estate since 2009, when they started showing up among the top three biggest groups of foreign buyers of residential property.  

Including both foreigners without permanent resident (PR) status and those with PR status, China nationals are today the largest group of non-Singaporean buyers of residential property.

In 2025, caveats data showed 1,266 purchases made by them, down from a peak of close to 3,000 in 2011 but still 55 per cent more than the next largest group, Malaysians. Malaysians accounted for 818 deals, while India buyers made up 615 transactions.

Some market watchers estimate that Chinese-linked demand accounts for as much as a fifth of overall property transactions. 

For now, those with property held in trusts are proceeding with caution.  

Cannis Seng, director and head of conveyancing at BR Law Corporation, was typically fielding at least three to four enquiries a month from Chinese clients looking to purchase homes through trusts. The number tends to rise around major project launches, he said. 

Since the tax changes, such enquiries have dwindled to almost none. 

“It definitely had an immediate chilling effect,” he said. “Quite a lot of the Chinese client pool are seeking appropriate advice from their Chinese solicitors … and there are some calculations going on, so (things) have slowed markedly.” 

The law firm began seeing such trust-structured buying around six years ago. It gained traction after the authorities doubled additional buyer’s stamp duty (ABSD) for foreigners to 60 per cent in April 2023, he said. 

Since then, the number of trust transactions handled by the firm has “easily” increased by 20 per cent year on year. 

At BR Law Corporation, trusts commonly involve a Chinese national purchasing a property for a US-born child, who would have acquired American citizenship at birth. Some have been as young as five months old.

As an American, the child receives the same stamp duty treatment as a Singaporean due to a free trade agreement between the countries. Any residential properties bought via trust are subject to 65 per cent ABSD. Part or all of the ABSD can be refunded if the home is held in trust for identifiable individual beneficiaries, depending on their profile. A Singapore (or US) citizen, for example, get a full refund on the ABSD paid when purchasing their first home.

“There are always Chinese nationals who like Singapore,” said Seng. “This trust-purchase mechanism (allows) them a legitimate way in which they can invest in Singapore properties on behalf of their children and do their legacy planning.” 

Almost all trust transactions he has dealt with are in the residential sector, since other property types, such as commercial and shophouses, do not incur ABSD.  

Most properties the firm has dealt with range between S$3 million and S$10 million. 

Still, Seng noted that trust purchases account for just a sliver of the market.  

BR Law has handled about 80 such transactions in the last 18 months, compared with overall conveyancing volumes that run in the tens of thousands. 

An insider told The Business Times of private bankers advising their wealthy Chinese clients to switch to investment products or platforms that offer greater privacy as scrutiny intensifies. 

With residential property, families could instead restructure their plans around citizenship or residency. They could, for example, have an immediate family member become a Singapore citizen, or buy the property themselves after obtaining permanent residency or citizenship.

Julian Yip, managing director of Realstar Premier Group which specialises in luxury landed homes and Good Class Bungalows, noted that interest has picked up recently, partly due to Singapore’s immigration policies. 

He estimated that individuals from China who have become Singapore citizens now account for around 10 per cent of landed and GCB transactions. Their share is likely to grow. 

“High-net-worth individuals who are PRs are more determined or (have) decided to stay here, so demand for landed property will increase,” said Yip. 

Christine Sun, Realion Group chief researcher and strategist, noted that the number of Chinese nationals buying non-landed private homes as foreigners plunged from 369 in 2021 to 38 in 2025, and totalled just 16 in the first eight months of 2026. 

Meanwhile, those buying as permanent residents rose from 939 in 2023 to 1,000 in 2024 and 1,145 in 2025.

ERA CEO Marcus Chu estimated that in the primary new launch market, units purchased by Chinese foreigners fell from 117 units in 2022 to 89 in 2023 and 19 in 2025.

Demand from PRs was more stable as foreigners bore the brunt of ABSD hikes in 2023. Chinese PRs’ buying of new-sale units slipped from 246 units in 2022 to 201 in 2023, and then recovered to 297 in 2025. 

Another observer, who declined to be named, said the tax changes, coupled with increasing tensions between global superpowers, have given some Chinese clients even more reason to put down roots and park their money in Singapore or elsewhere. 

But those who still hold mainland China citizenship and Singapore PR may face greater scrutiny, or even travel restrictions, when returning to the mainland, especially high-profile tech entrepreneurs.

The tax crackdown “will not materially change the appeal of Singapore as a trusted place to manage their wealth and to live in”, said Lee Sze Teck, Huttons Asia senior director of data analytics.

“Singapore’s properties from residential, commercial, shophouse and industrial sectors offer investors stable returns in the mid to long term.”

Chinese nationals with genuine residential, family or business ties in the Republic will continue to be drawn to Singapore property, said ERA’s Chu.

The agency recently engaged Chinese agents from Beijing to market a high-end project, W Residences Marina Bay, that was launched in Singapore last year. But Chu cautioned that “interest and enquiries should not be equated with completed purchases”. 

Many Chinese buyers today may be PRs or new citizens who intend to live or work in Singapore in the medium to long term, Sun said. 

Those who have passed Singapore’s “very comprehensive and stringent” anti-money laundering checks and demonstrated legitimate sources of funds are also less likely to be deterred by greater scrutiny from China, she added. 

Capital moving into the Asia-Pacific from mainland China has fallen sharply from the highs of the late 2010s. 

In 2026 so far, Knight Frank data showed US$2.1 billion flowed into the region, compared with US$3.2 billion in 2025 and S$3.7 billion in 2024, and down from a high of US$13.2 billion in 2018.  

The office sector drew the most capital, with US$2.5 billion between 2023 and 2025. This was followed by industry with US$2.4 billion and data centres with US$1.8 billion. 

Singapore was the second most popular destination for capital, drawing US$1.7 billion in the same period.

Richard Tan, founder of PropNex Shophouse Elites, has observed a drop in Chinese buyers of Singapore shophouses in recent years. 

But Tan attributed the pullback mainly to heightened caution following Singapore’s S$3 billion money laundering case in August 2023, when 10 Chinese nationals were arrested in an island-wide blitz. 

He pointed out that the majority of shophouse buyers are Singaporeans, with others from Indonesia, Korea, Taiwan, the UK and US, and Hong Kong.