I. Introduction
The deed tax is to be collected when the title of real estate is acquired pursuant to laws in the case of purchase, creation of a Dien, exchange, bestowal or donation, partition or possession. The obligators are purchaser, Dien Right holder, person involved in exchange, donee, partitioner, or person who takes possession of the property. As the real estate is transferred in different ways, the tax rate and obligator are different. The following will touch on details of the levy of deed tax.
II. Levy of Deed Tax
1. Taxpayer:
Real estate is acquired pursuant to laws in the case of purchase, creation of a Dien, exchange, bestowal or donation, partition or possession.
Please note: (1) real estate = land + buildings attached to the land
(2) In accordance with Deed Tax Act, deed tax is exempted for land in zone levying land value increment tax.
2. Tax rate and tax obligator
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Type of deed tax
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Tax rate
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Obligator
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Transaction
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6%
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Purchaser
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|
Dien Right
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4%
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Dien Right holder
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|
Exchange
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2%
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Parties involved in exchange
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|
Bestowal
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6%
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Donee
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|
Partition
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2%
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Partitioner
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|
Possession
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6%
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Person who takes possession of the property
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|
※For real estate obtained through exchange, the price difference shall be levied a 6% transaction tax if such price difference exists.
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3. Calculation of deed tax
(1) Formula of calculating deed tax
Deed Tax = Deed Amount × Tax Rate
(2) Deed tax case study
Obligator of deed tax shall choose to file the tax based on actual transfer price or the price assessed by Real Estate Value Assessment Commission. However, the actual transfer price shall still comply with the standard price aside from real estate obtained legally, bid from public property or court (standard price is taxable current value + house non-taxable current value – non-taxable hallway).
III. Important Notice
1. Deed tax is a tax levied at the time of obtaining real estate. Obligator shall file the tax by the deadline in accordance with Article 16 of Deed Tax Act to avoid overdue penalty.
2. In the event of contract cancellation, the filing of deed tax shall be revoked by submitting contract cancellation agreement of both parties, original contract in standard format, originally issued tax exemption certificate, or payment receipt slip, or secondary copy of the receipt prior to the completion of transfer registration; in the event that the deed tax has been paid, the paid tax shall be returned, for those who have not yet paid the deed tax, cancellation shall be filed so as to prevent enforcement of the law.