Foreign nationals selling properties within the territory of the R.O.C. to relatives within the second degree of kinship shall file gift tax.
National Taxation Bureau of Taipei, Ministry of Finance (hereinafter referred to as the NTBT) expressed that it had recently received a call, asking whether foreign nationals selling properties within the territory of the Republic of China (R.O.C.) to relatives within the second degree of kinship should file gift tax.
The NTBT explained that, in accordance with Paragraph 2 of Article 3 and Paragraph 1 of Article 9 of the Estate and Gift Tax Act “Property given away by a donor who is an R.O.C. citizen but resides outside the R.O.C. continuously or who is a non-R.O.C. citizen shall be subject to gift tax only to the extent that the property is located within the R.O.C.” and “The property within or outside the R.O.C. shall be determined by its location at the time of gifting by the donor.” Therefore, domestic property which is within the territory of the R.O.C. sold by a foreign national to relatives within the second degree of kinship shall be regarded as a gift and subject to gift tax as prescribed in Subparagraph 6 of Article 5 of the same Act.
The NTBT offered an example: Mr. B sold a property located in Beitou District of Taipei City to his son Mr. A in 2022. Although Mr. B lived overseas during the sale, he had to fill in the Gift Tax Declaration Form to file gift tax as the property is within the territory of the R.O.C. and was sold to a relative within the second degree of kinship. Nevertheless, if evidence that clearly indicates a bona fide sale for an adequate and full consideration in money or money’s worth and that the money thus paid did not come from a loan from the seller or a loan with which the seller furnished a guarantee can be provided, the gift tax may be exempted after the tax collection authority confirms that there is no obvious inconsistency in the sale price and that the sale is legal.
The NTBT emphasized that taxpayers should pay attention to tax laws and relevant regulations in order to protect their rights and interests. Foreign nationals can submit their declaration forms and documents via mail or in person to NTBT or its subordinated branches or offices. Related application forms can also be downloaded from the NTBT (https://www.ntbt.gov.tw/) based on taxpayers’ respective demands. In the case of having any question, please dial our free service hotline (0800-000-321) during normal working hours, and someone will serve you.
(Contact: Chen, Head of the Second Examination Division; Tel: 2311-3711 Ext. 1576)
Reference URL：https://www.mof.gov.tw/Eng/singlehtml/f48d641f159a4866b1d31c0916fbcc71?cntId=047a9e637dd542bfb5226a50570df861