I. Can you deduct the rent on the house in the name of the parents
As a general rule, a dwelling in the name of the parents cannot be deducted from the rent. Housing rental deductions in the special deduction for personal income tax are for housing rental expenses incurred by taxpayers without their own housing in the main working city。
If the house is in the name of the parents, but you have no other housing in the main working city and you actually incur housing rental expenses, it may be deducted according to the prescribed criteria. However, relevant information, such as housing rental contracts, must be kept on file。
If the house is only in the name of the parents and is used for their own living, it is not eligible for rental deduction. Local tax authorities or professional tax advisers may be consulted if there is doubt about the specific deduction。
Ii. Legitimacy of rent deductions requested by parents
It is unlawful to request rent deductions from a parent. Under the individual income tax specific subsidy, the special subsidy on rental of housing requires the taxpayer to incur housing rental expenses in the main working city for which there is no owner. Houses in the name of parents do not meet the condition of “no home owned in the main working city”。
The false declaration of rent deductions is a violation of tax regulations. Tax authorities can verify the authenticity of declared information by means of, inter alia, big data. Once a false declaration has been detected, it is possible not only to pay the tax deductions already received, but also to face delays and fines. Therefore, rent deductions should not be applied for in the case of parents。
Iii. Declaration of rent for housing by parents
It is illegal to declare rent deductions for housing in the name of the parents。
In accordance with the temporary scheme for the special supplement to personal income taxes, the taxpayer may deduct the rental expenses incurred by him or her in the main working city for housing that he or she does not own. Here, the term “proprietary housing” refers to housing owned by the taxpayer and his/her spouse in the main working city. Houses in the name of parents do not, in essence, meet the condition of “no home owned in the main working city”。
The fraudulent declaration of rental deductions for housing is a fraudulent tax preference. The tax authorities have the power to order corrections and, if the situation is serious, they will be held liable under the relevant regulations, such as the law of the people's republic of china on the administration of tax collection. Therefore, rental deductions should not be claimed in such cases。
In addition to the basic rules, there are a number of relevant points that deserve attention when we look at whether rent can be deducted from a dwelling in the name of the parents. For example, if a standard lease contract is entered into with the parents, it is possible to deduct the rent when eligible. In addition, details such as the manner in which the deduction of rents was calculated were important. Do you have any doubts about that? Do not miss the opportunity to obtain an accurate answer if there is no clarity as to the specific procedure for deduction of rent, the material required or the deduction criteria for the rental of the dwelling by the parents. Click on the “ask now” button at the bottom of the web page, which will be read in detail by the legal professionals, which will help you to clarify the legal provisions and operational points of the text and to dispel your confusion。
