Interpretation on relevant provisions concerning income taxes on the trading of houses and lands by individuals to whom such houses and lands are given by their spouses who have inherited such houses and lands (Taiwan)

2018.10.31
Tiffany Hsiao

The Ministry of Finance issued the Tai-Cai-Shui-10704604570 Circular of October 31, 2018 (hereinafter, the “Circular”) to interpret relevant requirements for income taxes on the trading of houses and lands by individuals to whom such houses and lands are given by their spouses who have inherited such houses and lands.

According to the Circular, for an individual receiving any house or land from his/her spouse as a gift to the extent that the requirement under Point 1 of the Tai-Cai-Shui-10504632520 Circular of March 2, 2017 is satisfied, the acquisition date for the sale of the house or land should be the day on which the spouse originally obtains the house or land before the first mutual transfer as a gift between the spouses, and the income tax shall be levied based on the acquisition reasons of such house or land pursuant to relevant provisions of the Income Tax Law. Therefore, in case an individual sells a house or land given as a gift from his/her spouse, if the spouse obtains such house or land by way of inheritance after January 1, 2016, and the inheritee obtained such house or land prior to December 31, 2015, the requirements under Point 1, Subparagraph 2 and Points 2 through 4 of the Tai-Cai-Shui-10404620870 Directive of August 19, 2015 from the Ministry of Finance shall apply.  To wit, in case an individual sells a house or land given by his/her spouse as a gift, if the spouse obtains it after January 1, 2016, and the inheritee obtained the house or land before December 31, 2015, the property transaction income calculated with respect to the house under Article 14, Paragraph 1, Category 7 of the Income Tax Law shall be included in the total consolidated income and the tax shall be assessed and filed within the required period.