State Administration of Taxation

Announcement on Matters related to the collection and administration of the Individual Income Tax Policy for Supporting Residents in Purchasing Housing

Announcement of the State Administration of Taxation No.21, 2022

? ? ? ? In order to support residents to improve their housing conditions, according to theAnnouncement of the State Administration of Taxation of the Ministry of Finance on the Individual Income Tax Policy on Supporting Residents to Purchase New Houses(No. 30, 2022), the relevant collection and administration matters are announced as follows:

? ? ? ? I. Taxpayers who sell their own houses between October 1, 2022 and December 31, 2023 and buy new houses in the same city within one year after the sale of their current houses may apply for refund of the individual income tax they have paid for the sale of their current houses according to the regulations.

? ? ? ? The calculation formula of the personal income tax refund for the taxpayer replacing the housing is as follows:

? ? ? ? If the newly purchased housing amount is greater than or equal to the current housing transfer amount, the tax refund amount = the individual income tax paid at the time of the current housing transfer;

? ? ? ? If the amount of newly purchased housing is less than the transfer amount of the current housing, the tax refund amount = (the amount of newly purchased housing ÷ the transfer amount of the current housing) x the individual income tax paid at the time of the transfer of the current housing.

? ? ? ? If the amount of the current transfer of housing or the amount of the newly purchased housing is inconsistent with the approved assessable tax price, the approved assessable tax price shall prevail.

? ? ? ? The transfer amount of the current housing and the newly purchased housing amount are exempt from VAT.

? ? ? ? II. For the sale of multi-owned housing or the newly purchased housing is multi-owned, the amount of the taxpayer’s current housing transfer or newly purchased housing shall be determined according to the taxpayer’s share of property rights.

? ? ? ? III. The time of selling the current house shall be subject to the time when the individual income tax is paid when the taxpayer sells the house. If the newly purchased housing is a second-hand house, the time of purchasing housing shall be the time of paying the deed tax or the registration time specified in the real estate title certificate. If the newly purchased housing is a new house, the time of purchase shall be subject to the time of filing the housing transaction contract with the housing and urban and rural construction department.

? ? ? ? IV. Taxpayers who apply for the benefit of the individual income tax refund policy of residents exchanging houses shall pay the individual income tax related to the transfer of the current houses in accordance with the law and complete the registration of the change of the ownership of the immovable property; If the newly purchased house is a second-hand house, it shall pay the deed tax according to law and complete the registration of the change of the ownership of the real estate. If a newly purchased house is a new house, it shall complete the filing of the housing transaction contract in accordance with the requirements of the local housing and urban and rural construction department.

? ? ? ? V. Taxpayers who enjoy the policy of individual income tax refund for residents who exchange houses shall apply to the competent tax authorities that collect the individual income tax from the current transfer of houses, fill out the Application Form for Individual Income Tax Refund for Residents who Exchange Houses (see the attachment for details), and shall provide the following information:

? ? ? ? (I) the taxpayer’s identity document;

? ? ? ? (II) The housing transaction contract of the current house

? ? ? ? (III) If the newly purchased house is a second-hand house, the housing transaction contract, the real estate right certificate and the copies thereof shall be provided;

? ? ? ? (IV) If the newly purchased housing is a new house, the housing transaction contract filed (signed online) by the housing and urban and rural development department and the copy thereof shall be provided.

? ? ? ? Relying on the tax payment information of the taxpayer selling the current housing and newly purchased housing, the tax authorities provide the taxpayer with the pre-filling service of the application form, and keep the copy of the certificate of real estate rights and the copy of the housing transaction contract of the newly purchased new housing. Taxpayers check and confirm the application form before submitting the tax refund application.

? ? ? ? VI. Tax authorities use information such as the filing of housing transaction contracts shared by housing and urban and rural construction departments to review tax rebates. If the requirements for tax refund are met after examination, tax refund shall be handled in accordance with relevant provisions; Those who do not meet the requirements for tax refund after examination shall not be refunded according to law.

? ? ? ? VII. If the taxpayer no longer meets the conditions for enjoying the tax refund policy due to the rescission, cancellation or invalidation of the housing transaction contract of the newly purchased housing, it shall take the initiative to pay the refunded tax to the competent tax authorities within 15 days of the next month when the rescission, cancellation or invalidation of the contract occurs.

? ? ? ? Where a taxpayer meets the circumstances specified in the first paragraph of this Article but fails to repay the refunded tax as required, or fails to meet the conditions specified in this announcement to fraudulently obtain a tax refund, the tax authorities shall deal with the case in accordance with the Law of the People’s Republic of China on the Administration of Tax Collection and its implementation rules and other relevant provisions.

? ? ? ? VIII. Tax authorities at all levels should carry out publicity and guidance, strengthen policy interpretation and tax payment guidance, continuously optimize the handling process, carry out reminders, and facilitate taxpayers to enjoy tax incentives.

? ? ? ? IX. This Announcement shall be effective from October 1, 2022 to December 31, 2023.

? ? ? ? It is hereby announced.

? ? ? ? Attachment:Application form for individual income tax refund for residents changing houses

The interpretation of the Announcement of the State Administration of Taxation on Matters related to the collection and administration of the Individual Income Tax Policy of Supporting Residents in Purchasing Housing

? ? ? ? In order to support the demand of individuals to exchange houses, the State Administration of Taxation issued the Announcement of the State Administration of Taxation on the Collection and Administration of the Individual Income Tax Policy of the State Administration of Taxation on the Collection and Administration of the Individual Income Tax Policy of the State Administration of Taxation on the Collection and Administration of the Individual Income Tax Policy of the State Administration of Taxation on the Support for Residents to Exchange Houses (No. 30, 2022). The interpretation is as follows:

? ? ? ? I. When can the taxpayer enjoy the tax refund policy?

? ? ? ? Between October 1, 2022 and December 31, 2023, taxpayers who sell their own homes and re-buy their homes in the market within one year after the sale of their current homes will be given a tax refund on the personal income tax they have paid on the sale of their current homes.

? ? ? ? Example 1:Taxpayer Xiao Zhou sold a house in December 2022 and bought another house in the same city in July 2023. Since Xiao Zhou sold and bought the house from October 1, 2022 to December 31, 2023, the taxpayer met the time conditions stipulated by the policy.

? ? ? ? II. How is the taxpayer’s tax refund amount calculated?

? ? ? ? During the period from October 1, 2022 to December 31, 2023, for taxpayers eligible for tax refund, when the amount of newly purchased housing is greater than or equal to the current housing transfer amount, all the individual income tax already paid will be refunded; When the newly purchased housing amount is less than the current housing transfer amount, the individual income tax paid by the current housing is refunded according to the proportion of the newly purchased housing amount to the current housing transfer amount. The calculation formula is:

? ? ? ? 1. If the newly purchased housing amount is greater than or equal to the current housing transfer amount, the tax refund amount = the individual income tax paid at the time of the current housing transfer;

? ? ? ? 2. If the newly purchased housing amount is less than the current housing transfer amount, the tax refund amount = (the newly purchased housing amount ÷ the current housing transfer amount) x the individual income tax paid at the time of the current housing transfer.

? ? ? ? Among them, the transfer amount of the original housing and the newly purchased housing amount are not VAT.

? ? ? ? Example 2:In December 2022, Yang sold an apartment with a transfer amount of 2.4 million yuan and paid personal income tax of 40,000 yuan. In May 2023, he re-purchased a house in the same city, with the newly purchased house amount of 3 million yuan. It is assumed that Xiao Yang meets the other conditions of enjoying the personal income tax policy of exchange housing at the same time. Since the newly purchased housing amount is greater than the current housing transfer amount, the tax refund amount Xiao Yang can apply for is the personal income tax paid at the time of the current housing transfer of 40,000 yuan. If the amount of newly purchased housing is 1.5 million yuan, the amount of tax refund can be applied for is 25,000 yuan (150÷240× 40,000 yuan). (Assume the above prices are excluding VAT)

? ? ? ? III. How should taxpayers calculate their tax refund amount for houses jointly held by more than one person?

? ? ? ? For the sale of more than one jointly held housing or newly purchased housing for more than one jointly held, should be determined according to the taxpayer’s share of property rights to determine the taxpayer’s current housing transfer amount or new housing purchase amount.

? ? ? ? Example 3:Xiao Li and Ma hold a house together, each holding 50 percent of the property rights. In January 2023, they transferred the house at the price of 2 million yuan, each paying personal income tax of 20,000 yuan. In May of the same year, Xiao Li re-purchased a house in the same city at the price of 1.5 million yuan. When Xiao Li applied for the tax refund, the amount of his current house transfer was 1 million yuan (200×50%=100), and the amount of his new house purchase was 1.5 million yuan. The tax refund amount = the individual income tax paid at the time of the current house transfer = 20,000 yuan.

? ? ? ? In July of the same year, Ma and others in the same city for the price of 2 million yuan jointly bought a house, Ma accounted for 40 percent of the property rights. When Ma applied for the tax refund, the amount of the current housing transfer was 1,000,000 yuan (200×50%=100), the amount of the new housing purchase was 800,000 yuan (200×40%=80), the amount of the tax refund = (the amount of the new housing purchase ÷ the amount of the current housing transfer) × the individual income tax paid at the time of the current housing transfer =80/100×2= 16,000 yuan. (Assume the above prices are excluding VAT)

? ? ? ? IV. How to determine the sale of housing, and house purchase to the time?

? ? ? ? The time of selling the current house shall be subject to the time when the individual income tax is paid when the taxpayer sells the house. If the newly purchased housing is a second-hand house, the time of purchasing housing shall be the time of paying the deed tax or the registration time specified in the real estate title certificate. The tax authorities will pre-fill the above tax-related information for the taxpayer, and the taxpayer can check with the time marked on the tax payment certificate obtained at the time of tax payment. If the newly purchased house is a new house, the time of purchasing the house shall be subject to the time of filing the housing transaction contract in the housing and urban and rural construction department. The taxpayer may fill in the housing transaction contract according to the facts.

? ? ? ? V. Where should a taxpayer eligible for the policy apply for tax refund?

? ? ? ? Taxpayers who enjoy the policy of individual income tax refund for residents who exchange houses shall apply to the competent tax authorities that collect the individual income tax on the current housing transfer income. That is to say, taxpayers shall apply for the tax refund to the tax authorities where they have paid the individual income tax at the time of selling the houses. Tax authorities implement a one-window system for the registration of real estate taxes. Under normal circumstances, taxpayers should pay the individual income tax from the transfer of housing at the local government service hall or real estate trading hall and other places, so they should still apply for the tax refund at the government service hall or real estate trading hall. If the local tax authorities have other provisions, the relevant provisions shall be followed.

? ? ? ? VI. What materials should taxpayers provide when applying for individual income tax refund for residents to exchange housing?

? ? ? ? In order to apply for the individual income tax refund for residents’ replacement of housing, a taxpayer shall, in addition to submitting the Application Form for Individual Income Tax Refund for Residents’ Replacement of Housing to the competent tax authorities, provide the following information: (1) the taxpayer’s identity certificate; (2) house sales contracts of existing houses; (3) If the newly purchased housing is a second-hand house, the housing sales contract, the real estate right certificate and the photocopies thereof; (4) If the newly purchased housing is a new house, the housing transaction contract submitted to the housing and construction department for the record (signed online) and a copy thereof.

? ? ? ? VII. In order to facilitate taxpayers’ enjoyment of tax policies, what services have the tax authorities provided?

? ? ? ? In order to facilitate taxpayers to enjoy tax policies, tax authorities have launched a series of service measures. One is to simplify data submission and provide pre-filling services. Relying on the tax payment information of the taxpayer selling the current house and the newly purchased house, we provide the taxpayer with the pre-filling service of the application form. The data that the taxpayer needs to carry when applying for the tax refund is mainly used for the taxpayer to check the information of the application form. The tax department only keeps the copy of the real estate right certificate of the newly purchased second-hand house or the copy of the housing transaction contract of the newly purchased new house. Second, according to the system pre-filled, taxpayers filled in and confirmed the relevant information, automatic calculation of tax refund. Third, through a variety of channels and ways to carry out publicity interpretation and training, remind and help eligible taxpayers timely apply for tax refund, enjoy tax policies.

? ? ? ? VIII. What should be done with the tax refund that has been obtained if the taxpayer terminates the housing transaction contract after enjoying the individual income tax policy of residents for housing exchange?

? ? ? ? If the taxpayer no longer meets the conditions for enjoying the tax refund policy due to the rescission, cancellation or invalidation of the housing transaction contract for newly purchased houses, it shall take the initiative to pay the refunded tax to the competent tax authorities within 15 days of the next month when the rescission, cancellation or invalidation of the contract occurs. If a taxpayer delays in paying the tax refund, the tax authorities will impose a fine for overdue payment. Tax authorities will strengthen the review of tax refunds and the management of tax repayments after cancelling contracts by sharing information with housing and urban-rural development authorities.

? ? ? ? IX. What else should taxpayers pay attention to when applying for tax refund?

? ? ? ? The individual income tax policy to support residents to exchange houses is aimed at encouraging residents to exchange houses and improving living conditions. Taxpayers shall apply truthfully according to laws and regulations, fill in and check the application form carefully, and be responsible for the authenticity, reliability and completeness of the contents filled in and the attached information. Those who provide false information or materials to defraud tax refunds shall be dealt with by the tax authorities in accordance with the Law of the People’s Republic of China on the Administration of Tax Collection and its implementation rules and other relevant provisions.

? ? ? ? State Administration of Taxation