On 30 december, a joint communication was sent by the ministry of finance and the general tax administration, and new vat regulations for private house sales came into effect on 1 january 2026! Whether you're in the first-line city or in a small county, this policy can save you real money and silver, untangle it in plain white and read it directly。
The central change in the new rules is “harmonization” and “price reduction” and a complete departure from previous complex rules. First, all cities throughout the country are treated equally, including the north, where there is no special treatment; secondly, the division of general and non-general housing has been eliminated, regardless of the size and cost of the house, depending on the length of time it is held; and finally, the value-added tax on selling a house for less than two years has been reduced from 5 per cent to 3 per cent, a 40 per cent reduction。
The core rules consist of two rules: first, a direct exemption from vat for the foreign sale of houses held for two years (in terms of the date of the property certificate or certificate of entitlement, whichever is earlier); and second, a full tax of 3 per cent of the total price of the house held for less than two years, without deductions for the cost of renovations or intermediaries. It should also be noted that this policy is aimed only at natural persons and not at ordinary taxpayers in individual businesses。
Intuitively, for example, a 1 million house was sold less than two years ago, with a previous vat of 50,000, which now amounts to only 30,000 and directly to 20,000; and a 5 million house could save 100,000, which is not a small sum. The two-year-old house, even of a large household size in the north, may have previously been subject to a margin tax and is now tax-free directly and the replacement cost is significantly reduced。
There was also a transitional benefit: those who had sold their houses before 1 january 2026 but had not paid taxes were able to comply with the new regulations; those who had paid their taxes could not change, but had not done so quickly。
Why did this new rule come out? It's actually to keep the used room market alive. Many cities now have a large stock of second-hand houses, with high taxes and fees, a multiplicity of rules, a reluctance to sell by sellers and few options for buyers. The new deal has simplified tax systems and reduced costs, making sellers willing to “sell new and old”, and giving buyers more options and a virtuous circle。
For us ordinary people, this is a real dividend. If the house is ready for sale for two years, you may wish to wait for it; if you are in a hurry to replace it, you can also pay a small tax. A friend who buys a house can also benefit, with more options and more bargaining space。
In general, the new rules do not play word games, they are simple and national, and they actually reduce the costs to both buyers and sellers. It is truly commendable to have a policy of dealing with the ground, whether it is just needed or improved
