Beijing’s Offshore Trust Tax Tests Wealthy Chinese Property Buyers in 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.

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.

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.

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 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.

Non-landed private home transactions by Chinese buyers, per URA and Realion research: 2021, 1,744 in total, of which 1,375 bought as PRs and 369 as foreigners. 2022, 1,372 in total, 1,118 as PRs and 254 as foreigners. 2023, 1,121 in total, 939 as PRs and 182 as foreigners. 2024, 1,035 in total, 1,000 as PRs and 35 as foreigners. 2025, 1,183 in total, 1,145 as PRs and 38 as foreigners. January to August 2026, 651 in total, 635 as PRs and 16 as foreigners. Figures exclude executive condominiums.

The shift is clear in the split rather than the total. Purchases by Chinese buyers without PR status have collapsed from 369 in 2021 to 16 in the first eight months of 2026, while PR buying has held up far better.

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, with the number tending to rise around major project launches. Since the tax changes, such enquiries have dwindled to almost none.

“It definitely had an immediate chilling effect,” Seng 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 for foreigners to 60 per cent in April 2023. 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, gets 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 the firm has dealt with are in the residential sector, since other property types such as commercial and shophouses do not incur ABSD. Most properties 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.

Separately, MSCI and Knight Frank Asia-Pacific research on mainland China capital flowing into the region, covering transactions of at least US$10 million and excluding land, shows flows peaking around 2018 and running well below that level since 2021.