Statute Details
- Title: Property Tax (Replacement Owner-Occupied House Under Construction) (Remission) Order 2013
- Act Code: PTA1960-S727-2013
- Type: Subsidiary Legislation (SL)
- Authorising Act: Property Tax Act (Cap. 254), specifically powers under section 6(8)
- Commencement: 1 January 2014
- Legislation Number: S 727 (as shown in the extract)
- Status (as provided): Current version as at 27 March 2026
- Key Provisions: Section 1 (Citation and commencement); Section 2 (Definitions); Sections 3–6 (Remission mechanism, period, conditions, notification); Section 7 (Revocation, saving and transitional)
What Is This Legislation About?
The Property Tax (Replacement Owner-Occupied House Under Construction) (Remission) Order 2013 (“the Order”) provides a targeted remission of property tax on vacant land in a specific redevelopment scenario. In plain terms, if an individual owner demolishes an existing house and replaces it with a new house that will be used as the owner’s residence, the law allows the owner to receive a remission of tax that would otherwise apply to the land during the period when the land is treated as vacant.
The Order is designed to address a practical timing problem in redevelopment: between demolition and completion, the land may be assessed as vacant land under the Property Tax Act. Vacant land is generally taxed differently from owner-occupied residential premises. Without relief, an owner could face tax liability during the construction period even though the owner is actively rebuilding a home.
Accordingly, the Order sets out (i) how the remission amount is calculated, (ii) the maximum duration and the start/end dates of the remission period, (iii) strict conditions that must be met throughout the relevant period, and (iv) a notification and documentation process for the owner to qualify for remission.
What Are the Key Provisions?
1. Citation and commencement (Section 1)
Section 1 confirms the Order’s name and states that it comes into operation on 1 January 2014. This matters for transitional treatment and for determining whether a given redevelopment qualifies under the new framework or under the previously revoked order.
2. Definitions (Section 2)
Section 2 is critical because the remission depends on technical concepts. The Order defines, among other terms:
- “Commissioner of Building Control” by reference to the Building Control Act (Cap. 29).
- “CSC” (certificate of statutory completion) and “TOP” (temporary occupation permit), both issued by the Commissioner of Building Control under section 12 of the Building Control Act. If multiple certificates/permits are issued, the first is used.
- “house” as a building (or part) principally used/constructed/adapted for human habitation and determined to be a complete and separate unit.
- “owner” as an individual (not a company/association/body of persons) whose name appears in the Valuation List.
- “owner-occupied” meaning the house is principally used/occupied by the owner as residential premises.
- “replacement house” as a new house erected on land to replace a previously erected house that was demolished to make way for the new house.
- “owner-occupier’s tax rates” by reference to the Property Tax (Rates for Residential Premises) Order 2013.
For practitioners, these definitions determine eligibility and the measurement of the remission period. In particular, the Order is limited to individual owners and to a specific replacement-house scenario.
3. Remission of tax on vacant land (Section 3)
Section 3 is the core relief provision. It applies where an owner of land demolishes one or more houses on the land for the purpose of constructing one or more replacement houses. Subject to the Order’s conditions, the owner is entitled to remission of an amount of tax on the land computed under a formula.
The remission is framed as a comparison between what tax would be payable on the land during the “vacant land” period and what would have been payable if the demolished houses had remained owner-occupied. The formula uses:
- A: the tax payable on the land for the applicable period under paragraph 4.
- B: the total number of owner-occupied houses demolished.
- C: the total number of replacement houses to be built.
- D: a tax figure reflecting what would have been payable on the demolished houses at owner-occupier rates, adjusted depending on the ratio B/C.
The Order includes two important ratio-based rules:
- If B/C < 1, the remission calculation uses the owner-occupier’s tax rates that would have been payable during the applicable period on houses that were owner-occupied prior to demolition.
- If B/C ≥ 1, the calculation uses the tax that would have been payable on all demolished houses at the rates applicable to each such house.
Additionally, Section 3(2) provides that where B/C > 1, it is treated as 1 for the purposes of the formula. This effectively caps the ratio effect and prevents the remission computation from being distorted where the number of demolished houses exceeds the number of replacement houses.
4. Period of remission (Section 4)
Section 4 defines the temporal scope of the remission. The remission applies for the land from:
- Start: the later of (i) the date the land is assessed as vacant land under the Act, or (ii) the date of submission of building plans for the replacement house(s) to the Commissioner of Building Control.
- End: the earlier of (i) the date of issue of the TOP or CSC for the replacement house(s), or (ii) where there are multiple replacement houses, the first TOP/CSC issued for any of them.
There is also a hard cap: the remission period cannot exceed 2 years and cannot include any period before 1 January 2014. This cap is particularly important for large redevelopment projects that may run beyond two years.
5. Conditions for remission (Section 5)
Section 5 sets out the conditions that must be satisfied. These are not merely formalities; failure to meet them triggers repayment of the tax that would otherwise be remitted.
Section 5(1)(a) – conditions during the applicable period requires that:
- (i) the land where the replacement house(s) are being constructed is not occupied during the applicable period;
- (ii) no rent or fee is charged or received for any use of the land or any part thereof;
- (iii) the owner of the demolished house(s) is also the owner of the replacement house(s) being constructed;
- (iv) no other property of that owner is taxed at the owner-occupier’s tax rates, unless that other property is taxed at such rate pursuant to specified provisions in the Property Tax (Rates for Residential Premises) Order 2013.
Section 5(1)(b) – notification to the Comptroller requires the owner to notify the Comptroller of the construction at any time:
- on or after the date of submission of building plans; but
- no later than 30 days from and including the date of issue of the applicable TOP or CSC (or such further time as the Comptroller may allow).
Section 5(1)(c) – post-completion owner-occupation requires that after construction is completed, the replacement house (or at least one replacement house) is owner-occupied for at least one year from and including the date of issue of the TOP or CSC (whichever is earlier).
Section 5(2) – consequence of non-compliance
If any condition is not satisfied, the tax that would otherwise be remitted becomes payable, and section 36 of the Act applies accordingly. For practitioners, this is a strong enforcement hook: it signals that remission is conditional and that the tax authority can recover the benefit if the factual prerequisites are not met.
6. Notification form and undertakings (Section 6)
Section 6 specifies that the notification must be in a form determined by the Comptroller and must be accompanied by:
- (a) a declaration by the owner that the requirements in Section 5(1)(a) are satisfied, or an undertaking to ensure compliance for any requirements not satisfied at the time; and
- (b) an undertaking to comply with the Section 5(1)(c) requirement (the one-year owner-occupation period).
This structure is important for compliance management: it creates a paper trail and formal undertakings that can support enforcement if the owner later fails to meet the substantive conditions.
7. Revocation, saving and transitional (Section 7)
Section 7 addresses continuity with a previous remission regime. It:
- Revokes the earlier Property Tax (Residential Premises under Construction) (Remission) Order (O 17).
- Revokes any remission granted under the revoked order that is on or after 1 January 2014.
- Provides a saving so that the revoked order continues to apply to remission periods that are before 1 January 2014.
- Provides a transitional rule: where, on 31 December 2013, there is a remission under the revoked order with a period expiring on or after 1 January 2014, the application under paragraph 6 of the revoked order is treated as a notice under Section 5(1)(b) of the new Order.
For redevelopment projects spanning 2013–2014, these transitional provisions can determine whether the owner’s existing application/notice is treated as compliant under the new framework.
How Is This Legislation Structured?
The Order is concise and structured around a single relief mechanism:
- Section 1 sets out citation and commencement.
- Section 2 provides definitions that govern eligibility and calculation.
- Section 3 establishes the remission of tax on vacant land and the formula for computing the remission amount.
- Section 4 defines the remission period, including start/end triggers and a maximum duration.
- Section 5 lists substantive conditions (vacancy/occupation, no rent/fees, ownership continuity, owner-occupier rate restrictions, notification timing, and a one-year post-completion owner-occupation requirement) and provides consequences for breach.
- Section 6 sets out the notification form and required declarations/undertakings.
- Section 7 handles revocation and transitional treatment for the earlier remission order.
Who Does This Legislation Apply To?
The Order applies to individual owners (not companies or associations) who demolish one or more owner-occupied houses on their land to construct one or more replacement houses. The land must be assessed as vacant land during the relevant period, and the owner must satisfy the conditions in Section 5.
In practice, the relief is aimed at owner-occupiers who are rebuilding their own homes. The conditions also restrict situations where the owner might have other properties taxed at owner-occupier rates, and they require that the replacement house is ultimately owner-occupied for at least one year after TOP/CSC issuance.
Why Is This Legislation Important?
This Order is significant because it provides a financial relief mechanism during a redevelopment window that would otherwise attract property tax on vacant land. For practitioners advising homeowners, it offers a structured pathway to reduce tax exposure where demolition and construction are necessary to replace an existing residence.
Equally important are the compliance risks. The conditions in Section 5 are detailed and time-sensitive: the land must not be occupied, no rent/fees can be charged, the owner must remain the same across demolition and replacement, and the owner must notify the Comptroller within a strict 30-day period after TOP/CSC issuance (subject to possible extension). Failure to satisfy any condition triggers repayment of the remitted tax and activates section 36 of the Property Tax Act.
From a legal practice perspective, the notification and undertaking requirements in Section 6 mean that documentation and timing are central. Advisers should ensure that clients can evidence compliance with the vacancy and no-rent/fee requirements during construction, and that they can commit to (and later demonstrate) the one-year owner-occupation period after completion.
Related Legislation
- Property Tax Act (Cap. 254) (including section 6(8) authorising the Order and section 36 on consequences for non-compliance)
- Building Control Act (Cap. 29) (relevant to issuance of TOP and CSC under section 12)
- Property Tax (Rates for Residential Premises) Order 2013 (including the owner-occupier’s tax rates and referenced provisions in paragraph 4(6) and (7))
Source Documents
This article provides an overview of the Property Tax (Replacement Owner-Occupied House Under Construction) (Remission) Order 2013 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.