Rental Support Scheme: Who Are The Qualifying Tenants Of Commercial Properties And How To Apply For It

Rental Relief Singapore

For every business affected by COVID-19 Safe Management Measures (SMM), the Rental Support Scheme (RSS) has been a welcomed reprieve. Initially introduced during the Phase 2 (Heightened Alert) period from 14 May to 29 May 2021, the Rental Support Scheme (RSS) has already been enhanced with a second and third payout as Singapore revert grapples with reopening for business.

To support businesses with rental costs, the government has committed to provide rental relief to eligible SMEs and Non-Profit Organisations (NPOs) who are tenants or owner-occupiers of qualifying commercial properties. 

For the first Rental Support Scheme payout, IRAS announced that over 38,400 tenants and owner-occupiers are eligible, and will receive more than $216 million to help offset rental costs. The second RSS payout from 22 September will benefit over 35,800 tenants and cost the government more than $200 million. Details for the third rental support scheme will be announced in early October 2021.

Eligible tenants and owner-occupiers will be notified by post or you can log into IRAS’ myTax portal from 22 September 2021 (with details for the first and second RSS) to view the electronic copy of the letter of their payouts.

Eligibility RequirementsFirst Rental Support Scheme PayoutSecond Rental Support Scheme PayoutThird Rental Support Scheme Payout
Eligible EntitiesSMEs and NPOs with annual revenue not exceeding $100 million, based on FY2019 or a later periodSMEs and NPOs with annual revenue not exceeding $100 million, based on FY2019 or a later periodTo be announced in early October 2021      
Eligible Properties/UsesMust be either a tenant or owner-occupier of a qualifying commercial property or operate based on a qualifying commercial useMust be either a tenant or owner-occupier of a qualifying commercial property or operate based on a qualifying commercial use
Qualifying PeriodStamped lease or license which was entered into before 14 May 2021, and in force anytime during 14 May 2021 to 29 May 2021Stamped lease or license which was entered into before 20 July 2021, and in force anytime during 22 July 2021 to 18 August 2021
Stamping DeadlineBefore 28 May 2021Before 3 August 2021
Quantum of payout0.5 months of: [Tenants] latest contracted gross rent within the period 14 May 2021 to 29 May 2021 [Owner-occupiers] property’s Annual Value as at 14 May 20210.5 months of: [Tenants] latest contracted gross rent within the period 22 July 2021 to 18 August 2021 [Owner-occupiers] property’s Annual Value as at 22 July 2021
Disbursement TimelineFrom 6 August 2021From 22 September 2021
Disbursement ModeGIRO or PayNow, if registered with IRAS. Other, by cheque sent to tenant’s/owner-occupier’s registered addressGIRO or PayNow, if registered with IRAS. Other, by cheque sent to tenant’s/owner-occupier’s registered address
Opening of Applications (for eligible tenants who do not receive the cash payout)16 August 202129 September 2021

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How Much Will The Rental Support Scheme Provide To Qualifying Tenants?

A total of three Rental Support Scheme (RSS) payouts has been announced. The first RSS payout will be for the Phase 2 (Heightened Alert) period from 14 May to 29 May 2021, while the second RSS payout will be for the Phase 2 (Heightened Alert) period from 22 July to 18 August 2021. The third RSS payout will be for the tightened Safe Management Measures during 27 September to 24 October 2021.

These payouts will be given directly to tenants and owner-occupiers rather than go through landlords. In 2020, a similar rental rebate was provided to eligible tenants and owner-occupiers. However, that was paid to landlords, which resulted in some landlords not passing the rent rebates to their tenants.

This time, tenants will be required to pass on the rental relief to their qualifying sub-tenants.

For Government-owned commercial properties, no payouts will be made. Instead, the landlord agency will grant a 1-month rental waiver: 

  • For the Phase 2 (Heightened Alert) period between 14 May to 29 May 2021, a one-month rental relief will be given
  • For the Phase 2 (Heightened Alert) period between 22 July to 18 August 2021, a further one-month rental relief will be given
  • Further details of the RSS payout for the tightened Safe Management Measures between 27 September to 24 October 2021 will be announced in early October 2021

For privately-owned commercial properties, the payout amounts will be computed based on the contractual gross rent during the respective Phase 2 (Heightened Alert) periods.

  • For the Phase 2 (Heightened Alert) period between 14 May to 29 May 2021, a 0.5-month rental relief will be disbursed by IRAS from 6 August 2021
  • For the Phase 2 (Heightened Alert) period between 22 July to 18 August 2021, a further 0.5-month rental relief will be disbursed by IRAS starting from 22 September 2021
  • Further details of the RSS payout for the tightened Safe Management Measures between 27 September to 24 October 2021 will be announced in early October 2021

Eligible tenants and owner-occupiers can use eligibility checkers provided by IRAS to figure out if they qualify and/or how much they will receive.

Payouts will be made directly to the qualifying tenant/owner-occupier based on your mode of payment registered with IRAS (e.g. bank account used to pay income tax via GIRO or PayNow). If you don’t have a registered bank account with IRAS, a cheque will be sent to your registered address within two weeks from the cash payout date. If you are eligible for the Rental Support Scheme have not received the cash payout by 1 September 2021, you should submit an application to IRAS.

Read Also: Step-By-Step Guide On How To Change Your Registered Business Activity In BizFile

What Are The Qualifying Commercial Properties Or Uses?  

Similar to the affected sectors supported by the JSS enhancements, the list of qualifying commercial properties covers the retail, F&B, sports and hospitality sectors.

According MOF’s press release, these include:

  • Shop (e.g. retail shop, furniture shop, pet shop, supermarket, take-away food shop, bakery & confectionery, pawnshop, dispensary, beauty salon, gym, spa, ticket agency, travel agency, laundry or dry-cleaning shop, department store, post office, showroom, bank, and vet clinic)
  • Warehouse retail
  • Restaurant (e.g. restaurant, café, cybercafé, food court, coffeeshop, market & hawker stalls, bar, and night club)
  • Amusement centre (e.g. video games arcade, computer gaming centre, and billiard saloon)
  • Cinema or theatre
  • Sports and recreational building (e.g. social club, golf club, clan and association, skating rink, and bowling alley)
  • Child care centre or kindergarten
  • School (e.g. tuition centre, language school, computer school, art school, dancing school, speech and drama school, child development centre, play school, foreign system school, training or vocation training institute, other private education institution, and driving school)
  • Health and medical care building (e.g. medical clinic, medical centre, dental clinic, hospital, nursing home, hospice, place of rehabilitation or convalescent home)
  • Hotel room or function room of a hotel registered under the Hotels Act (“registered hotel”)
  • Backpackers’ hostel, boarding house, guest house, hotel or students’ hostel that is not a registered hotel
  • Serviced apartment or serviced apartment function room
  • Meetings, Incentive Travel, Conventions and Exhibitions (MICE) venues (e.g. Suntec Singapore Convention and Exhibition Centre, Singapore EXPO, and Changi Exhibition Centre)
  • Premises of a prescribed international cruise or regional ferry terminal, (e.g. Singapore Cruise Centre, Marina Bay Cruise Centre Singapore, and Tanah Merah Ferry Terminal)
  • Premises of tourist attractions (e.g. Singapore Zoological Gardens, Singapore Flyer, and Haw Par Villa)

What Is The Application Process For The Rental Support Scheme?

Most qualifying tenants and owner-occupiers will receive the cash payout automatically, without needing to make any application. 

However, tenants who only rent part of a property or tenants who rent a mixed-use property (e.g. a shophouse for both retail and residential use) will not receive the payout automatically. Instead, these businesses will have to apply to IRAS and provide supporting documents.

Applications for the Rental Support Scheme are:

  • First RSS Payout: 16 August 2021 [for the period from 14 May 2021 to 29 May 2021], and ends on 15 October 2021
  • Second RSS Payout: 29 September 2021 [for the period from 22 July 2021 to 18 August 2021], and ends on 12 November 2021
  • Third RSS Payout: application dates will be announced in the future

Timely Rental Relief For SMEs

Unlike the previous round of rental relief which was disbursed through landlords, the new Rental Support Scheme puts the cash payout in the hands of the tenants directly. This circumvents any issue of errant landlords withholding the rental relief.

Rental Waiver Framework For Landlords To Provide 2 Weeks Of Rent Waiver To Tenants

Rental Support Scheme cash payouts for privately-owned commercial properties are only worth half of the support provided to government properties. This is because “private landlords were encouraged to extend help to tenant-occupiers for their rental costs through rental waivers or rebates”. This was formalised by the Ministry of Law under the Rental Waiver Framework (RWF). You can check whether you are eligible for a 2-week rental waiver on the MinLaw website.

Landlords have to provide 2 weeks of rental waiver if their tenants are eligible. To be eligible, tenants must meet all the eligibility criteria:

  1. Tenant-occupier of a qualifying commercial property
  2. Annual revenue not exceeding $100 million in FY2019
  3. Lease or licence must be
    • Entered into or renewed before 20 July 2021
    • In force for the entire period from 5 August to 18 August 2021 (both dates inclusive)
    • Where applicable, stamped on or before 2 August 2021
  4. Suffered at least a 20% drop in average monthly revenue during both Phase 2 (Heightened Alert) periods (16 May 2021 to 13 June 2021 and 22 July 2021 to 18 August 2021, all dates inclusive), as compared to the Phase 3 period (28 December 2020 to 7 May 2021, both dates inclusive)
  5. If part of a Singapore group of entities (“group”), the group’s annual revenue does not exceed $100 million in FY2019

Source: MinLaw

Since tenants have to show that they suffered a drop in business during both Phase 2 (Heightened Alert) periods, you have to submit supporting documents. These supporting documents should be submitted to your landlord within 28 days of you receiving your Notice of Rental Waiver for the second payout under the Rental Support Scheme (RSS) Such documents include:

  • A copy of the Notice of Rental Waiver
  • Profit and loss statements for all the following periods
    • 16 May to 13 June 2021 (first Phase 2 (Heightened Alert))
    • 22 July to 18 August 2021 (second Phase 2 (Heightened Alert))
    • 28 December 2020 to 7 May 2021 (Phase 3)
  • The Singapore group of entities’ audited financial statements for FY2019 (does not apply to SMEs that are not part of any group of companies, or NPOs)
  • A Statutory Declaration, made before a Commissioner for Oaths, Notary Public or a Justice of the Peace, attesting that you meet the eligibility criteria to qualify for the rental waiver (if you are unable to provide any of the profit and loss statements). (Visit https://go.gov.sg/conp-list and https://go.gov.sg/jp- list for more information on Commissioners for Oaths, Notaries Public and Justices of the Peace.)

Source: MinLaw

Landlords can exempt themselves from their rental waiver obligations if they themselves face financial hardships. Such landlords must meet the following criteria:

  • Annual Value of the investment properties owned by the applicant or each shareholder of the holding company (whether directly, or indirectly through companies) is less than $60,000
  • The average monthly rental income from all properties owned by the applicant, or each shareholder of the holding company (whether directly, or indirectly through companies) constitutes 75% or more of his/her average monthly gross income

This article was first published on 31 May 2021 and has been updated with the latest information.

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