I. Introduction
The ownership of real estate property acquired through purchase, the creation of a Dien, on a bestowal or a donation, exchange, partition or on possession is subject to the deed tax levy. The deed tax is assessed according to respective deeds at different
rates. To show taxpayers how to save on deed tax, a brief introduction concerning reduction and exemption is provided below.
II. Choosing a lower deed price can alleviate the tax burden:
(I) The value for the deed price is based on the standard prices assessed by the "Committee for the Evaluation of Real Estate Properties" at the time the transaction takes place.
(II) If the declared deed value should exceed the evaluated standard price, a taxpayer may choose to declare at the evaluated standard price. However, if the deed price declared falls below the evaluated standard price, the deed tax shall be imposed on the
basis of the evaluate standard price.
(III) In the purchase of real estate properties or real estate properties sold according to law, or the purchase of publicly owned real estate property through bidding or purchase of real estate properties at auction conducted by a court, the deed tax shall
be imposed on the basis of the actual purchase price.
III. Tax rate: Assessing the deed tax based on the deed value times an applicable tax rate.
|
Type of deed
|
Applicable tax rate
|
Remarks
|
| (1) Deed tax on a purchase and sale. |
6%
|
|
| (2) Deed tax on a bestowal or a donation. |
6%
|
|
| (3) Deed tax on a creation of a Dien. |
4%
|
|
| (4) Deed tax on an exchange. |
2%
|
|
| (5) Deed tax on a partition. |
2%
|
In the event that there is payment for the discrepancy in a deed on an exchange or deed on a partition, if any, are subject to the 6% of the deed tax.
|
| (6) Deed tax on a possession. |
6%
|
|
IV Precautions to avoid penalties：
(I) A taxpayer who fails to file a statement of deed tax within the 30 days period starting from the date of the deed goes into effect to a local tax collection authorities must pay a surcharge for every three days of delay equal to 1% of the amount of the
tax; however, the total fine imposed shall not exceed the amount of tax determined to be due.
(II) A taxpayer who fails to pay the deed tax due in full on or before the deadline must pay a late penalty fee, calculated at 1% of the tax amount for every two days of delay. If the taxpayer fails to pay the tax and the surcharge for late penalty or the
surcharge
for late filing for 30 days or more after the prescribe period, the matter shall be referred to the court for enforcement
(III) It is the duty of a taxpayer to truthfully declare all applicable deed tax, any untrue or under reporting, once it has been discovered by the competent tax collection office or upon information brought by another person shall, in addition to payment
of
the tax due, be penalized by imposition of an administrative fine equal to one to three times the amount of tax due.
