Citizens subject to the preferential mechanism offered for the purchase of new self-use house and land may apply for the refund or reduction of individual house and land transactions income tax.
National Taxation Bureau of Taipei, Ministry of Finance expressed that, after the launch of individual house and land transactions income tax on January 1, 2016, individual house and land transactions income tax 2.0 was further implemented on January 1, 2021 to curb short-term speculation by applying a higher tax rate for short-term transactions of real estate. Nevertheless, to support reasonable self-occupation needs and reduce citizens’ burdens derived from individual house and land transactions income tax, citizens who are subject to the preferential mechanism offered for the purchase of new self-use house and land may apply for the refund or reduction of individual house and land transactions income tax derived from the sale of their self-use house and land.
The Bureau explained that individuals who repurchased self-use house and land – regardless of whether it complies with the condition of “sale before the purchase” or “purchase before the sale” – may apply for the refund or reduction of the said tax, if the transfer registration of the sale of the old house/land and repurchase of the new house/land was made within 2 years and if the said individuals comply with self-use conditions. Regarding the determination of self-use house and land, the individual himself/herself, his/her spouse or minor child(ren) should complete registration of household on and live in the address, and the house should not be used for lease, business operations or professional practice.
The Bureau uses the following example to illustrate: Party A’s spouse purchased Property A located in Beitou District of Taipei City with NT$25,000,000 on May 22, 2022. On October 13, 2022, Party A sold Property B, which is located in Shilin District of Taipei City and within the scope of the individual house and land transactions income tax, at the price of NT$18,000,000. Party A and Party A’s spouse had their household registered on and lived in the address of Property A and Property B, respectively; and Property A and Property B were not used for lease, business operations, or professional practice. On October 17, 2022, Party A applied for individual house and land transactions income tax for the sale of Property B and the total thereof was NT$500,000. As Party A complied with the aforesaid self-use property conditions of “purchase before the sale” within 2 years and the price of purchased house was higher than the sold house, the “tax credit for the repurchase of self-use property”, which should not exceed the tax payable, should be deducted from the tax payable of NT$500,000.
The Bureau would like to remind taxpayers that the newly purchased property that has received a refund or reduction of individual house and land transactions income tax should not be used for lease, business operations, or professional practice or be transferred within 5 years. If any of the said circumstances occurs, the taxpayer will be demanded to pay back the said deducted or refunded tax amount. The Bureau therefore would like to remind all taxpayers to take note. If you have any questions, please dial the free hotline 0800-000321 for further explanation.
(Contact window: Examiner Lu of the Second Legal Affairs Division; telephone: 2311-3711 Ext. 1910)
(Ethics advocacy - 165 anti-fraud hotline or inquiry hotline 110)
Reference URL：https://www.mof.gov.tw/Eng/singlehtml/f48d641f159a4866b1d31c0916fbcc71?cntId=b7f4e32cd3e147d9af66a39f0383e837