There are a number of reasons for the transfer, including the sale, inheritance and gifts. In the event of the transfer of property, both parties are required to check with the housing administration and to pay a certain amount of household tax. What are the taxes and fees to be paid by the transfer? The following are specific descriptions。
I. Business tax
In accordance with the provisions of the current provisional regulation on business taxes and its implementing regulations, a non-reimbursable grant of real estate or land use rights by an entity or an individual to another unit or individual is deemed to have occurred as a taxable act. In principle, the grantee is subject to a turnover tax at a rate of 5 per cent。
1. Property is granted between close relatives and persons who are dependent or dependent, as well as in cases of inheritance or bequest to acquire property, and is exempt from business tax。
Article 2 of the circular of the national tax administration department of the ministry of finance on certain tax exemptions on turnover taxes, such as the sale of personal financial goods, provides that a person who grants property, land use rights, free of charge, shall be exempt from the tax if:
(i) separation of divorced property;
(ii) donating free of charge to spouses, parents, children, grandparents, grandparents, grandchildren, grandchildren, siblings;
(iii) the grant of a non-reimbursable grant to a dependant or a dependent for whom a direct obligation of maintenance or maintenance exists;
(iv) the death of the owner of the home, the legal heir, the heir to the will or the bequest who acquired the property in accordance with the law。
2. Property gifts between other persons shall be subject to a turnover tax in accordance with the law. However, in cases where the property is granted to another person for a certain period of time and meets the conditions for exemption from the turnover tax, the tax may be waived, for example, if the individual will purchase a home for a period of five years。
Additional taxes
Such taxes are levied as surcharges and only if they are subject to taxes such as turnover tax, value added tax, etc., in proportion to a percentage of the turnover tax payable, as follows: city building tax (7 per cent) and education fee surcharge (3 per cent). Such taxes are paid by the grantee in accordance with the law。
Taxes and stamp duties
1. Taxes
In accordance with article 4, paragraph 2, of the rules for the application of the provisional regulations of the people's republic of china on taxes and taxes, the tax basis for the tax is: (ii) land tenure grants, housing grants, approved by the collecting authority by reference to the market price of the sale of land use rights and the sale of houses. Thus, the recipient of the property is required to pay the tax in full。
In addition, article 1, paragraph 2, of the circular of the state tax administration on strengthening the administration of non-remunerated gifts and real estate taxes by individuals dealing with real estate transactions clearly states: “in the case of non-remunerated gifts by individuals and real estate, the grantee shall be taxed in full.”
Taxes on property granted are fully levied, i. E. Paid by the recipient at a rate of 3 per cent。
2. Stamp duty
The stamp duty, which is payable in full, is paid by the contracting parties at a rate of 0. 05 per cent。
Iv. Individual income tax
1. Personal income tax is exempt from the obligation to grant property between close relatives and persons who have a relationship of support or support, as well as in the event of inheritance or bequest to acquire property。
In accordance with article 1 of the circular of the ministry of finance and the state tax administration on personal income tax in respect of non-remunerated properties, no personal income tax shall be levied on the parties in the following cases:
(i) the owner of the home grants property rights free of charge to the spouse, parents, children, grandparents, grandparents, grandchildren, grandchildren, siblings;
(ii) the owner of the home grants the right to the property free of charge to the person to whom the maintenance or maintenance is owed;
(iii) the death of the owner of the home, the legal heir, the heir to the will or the bequest who acquired the property in accordance with the law。
2. Gifts between other persons shall be subject to personal income tax in accordance with the law。
If the owner of the property grants the property to another person free of charge, the recipient of a gift from a non-reimbursable gift is subject to personal income tax at a rate of 20 per cent under the item “other income determined by the financial department of the state council as a result of taxation”, subject to deduction of the relevant tax charges in the course of the transfer。
V. Institutional customs, a stay
Legacy (not immediate family members): (include limited purchase)
Business tax: exempted for five years
5 years of valuation x 5. 6 per cent
Tax: 5 years old and only dwelling exempt
5 years of valuation x 1 per cent
Note: the source of ownership of the inheriting property is taxed on a grant basis if it is written as “inheritance, gift”。
Note: business tax, transfer of tax: refers to “the time of registration of the registered property certificate or the time of filling in the tax certificate for five years”。
As a whole, five specific types of taxes, including personal income tax, turnover tax, deed tax, etc., are required to be paid in connection with the transfer of property, but this does not mean that they are borne by one party. It is possible to see the amount of taxes and fees to be paid in the event of a property transfer. More of this knowledge can be found on the chart website。
