Existing Procedure involving Differential Premium, Development Charge and Temporary Development Levy

1. Currently, if a planning application results in an increase in land value, landowners may need to pay Differential Premium (DP) to the Singapore Land Authority (SLA) and/or Development Charge (DC) or a Temporary Development Levy¹ (TDL) to the Urban Redevelopment Authority (URA) as follows:
1. Where the State title specifies the use and the maximum allowable intensity of the land, the landowner is required to apply to the SLA for the payment of DP.
2. Where the State title does not specify the use and/or maximum allowable intensity of land, the landowner is required to pay DC or TDL to URA. If the land has a residual unexpired tenure of 99 years of less, the landowner may apply to SLA to pay DP in lieu of paying DC or TDL to URA.
3. Where private freehold land is involved, the landowner is required to pay DC or TDL to URA. 

New Land Betterment Charge

Consolidation of DP, DC and TDL

2. With effect from 1 August 2022, a new Land Betterment Charge (LBC) will replace DP, DC and TDL. LBC will be charged and collected by a single agency, SLA, pursuant to the Land Betterment Charge Act 2021. Landowners seeking to develop their sites need not make a separate application to SLA for the payment of LBC once a planning application or plan lodgment for an authorised development has been submitted to URA². If the proposed development results in an increase in land value, SLA will follow up directly with the taxable person by issuing a Liability Order (LO) stating the LBC payable. Payment must be made to SLA within 1 month from the date of the LO. This will apply to all planning permissions, plan lodgment and variation of restrictive covenants granted on or after 1 August 2022. 

Computation of LBC

3. The principles for computing LBC follow the previous DP and DC systems. LBC will be computed based on the difference between the value of the post-chargeable valuation and pre-chargeable valuation. Post-chargeable valuation is the value derived from the variation of the relevant restrictive covenant, or the proposed use(s) and intensity in URA’s planning permission or plan lodgement. Pre-chargeable valuation is the value derived from the restrictive covenants in the State title or the last authorised/approved development. The historical Master Plans 1958/1980/2003 will continue to be taken into account in the determination of pre-chargeable valuation, where applicable. See Appendix 1 for more details on pre-chargeable valuation.


4. To facilitate early payment of LBC and issuance of planning approval, LBC will be computed based on the use(s) and intensity (i.e. gross floor area) as proposed by the Applicant/Qualified Person (QP) in the 1^st re-submission to the Provisional Permission (PP) to URA. If the approved use and/or intensity in the Written Permission (WP) deviates from what was declared in the 1^st re-submission, such that there is further increase in land value, a Revised Liability Order (RLO) will be issued requiring the payment of additional LBC, after WP has been granted. Payment of the additional LBC must be made within 1 month from the date of the RLO.


5. Similar to the current rates of charging for DP, DC and TDL, the initial LBC rate is generally set at 70% of the increase in land value arising from the grant of consent for development proposals, and 100% on an exceptional basis³.


6. The material date of determination for LBC will be pegged to the date of grant of PP or the start date of the validity of the second and subsequent PP extensions, whichever is later. For development proposals that are granted WP without a PP and authorised developments under plan lodgment, the material date of determination for LBC will be the respective WP/authorisation dates. For the variation of restrictive covenants where no planning application is required, the material date of determination for LBC will be the date consent for variation is given.


7. LBC will be computed by:

1. the Table of Rates method, which is based on LBC rates by use groups in each geographical sectors,⁴ similar to the DC Table of Rates in the previous Planning (Development Charges) Rules; or
2. the Valuation method, in which the Chief Valuer of the Inland Revenue Authority of Singapore (IRAS) will ascertain the amount of LBC through a valuation of the increase in land value arising from the chargeable consent.

8. The Valuation method will apply in specific circumstances where the Table of Rates are inapplicable, such as where there is no suitable or comparable use group for assessment. Taxable persons may also elect to use the Valuation method in lieu of the Table of Rates method, by using a prescribed form.⁵ Please note that such an election is irreversible.


9. If the land has a residual unexpired tenure of 99 years or less, the amount of LBC payable will be adjusted based on the current Leasehold Table, which expresses the value of the residual unexpired tenure as a percentage of freehold value. A copy of the Leasehold Table is at Appendix 2. If a temporary permission is issued, the amount of LBC payable will be adjusted based on the table in Appendix 3.

The Baseline Database

10. As a new service to landowners, the baseline information (i.e. use and intensity to determine pre-chargeable valuation) for all land parcels will also be progressively made available on SLA’s Integrated Land Service (INLIS) website from 1 August 2022. This will provide greater transparency and certainty to landowners, who can self-check and estimate the amount of LBC payable upfront. It will also be simpler for landowners as they no longer have to do multiple checks with SLA and URA on such information.

Associated costs

11. A fee of $1,100 will be collected for updating the database, and this will be payable together with the LBC upon issuance of the LO.

Further information

12. The new procedure for planning applications involving the payment of LBC is outlined in Appendix 4 of this circular. Examples of how LBC will be computed under the revised procedure are in Appendices 5 to 7. Frequently asked questions are in Appendix 8.


13. We would appreciate it if you could convey the contents of this circular to the relevant members of your respective organisations. If you or your members have any queries concerning this circular, please do not hesitate to contact the following:

1. SLA  

Feedback Form: https://www.sla.gov.sg/contact-us
Website: https://www.sla.gov.sg/state-land-n-property/land-sales-and-lease-management/lease-management

2. URA  

Feedback Form: https://www.ura.gov.sg/feedbackWeb/contactus_feedback.jsp

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¹TDL is computed based on the DC payable, pro-rated by a discounting factor that varies according to the term of the Temporary Permission up to 10 years. Please refer to Appendix 3 for the table of discounting factors.

²For the variation of restrictive covenants, landowners will need to continue applying directly to SLA, similar to the DP regime.

³Subject to periodic review as necessary.

⁴The table of rates/use group/geographical sectors are reviewed every 6 months (March & September) in consultation with IRAS.

⁵Election must be made within one week after the relevant point in time (i.e. the material date of determination as described in paragraph 6).