A must-see for those who rent houses! The maximum deduction for housing rental expenses in the comprehensive income tax declaration is 180,000 yuan

The Taipei National Taxation Bureau of the Ministry of Finance stated that in order to reduce the financial burden of those who rent houses, starting from January 1, 2014, taxpayers, spouses, and dependent immediate family members who "do not own houses" in Taiwan and must rent houses for their own residence and not for business or operation purposes can report a special deduction for housing rental expenses up to NT$180,000 (the same below) from the rent paid by each declaring household each year, minus the portion received from government subsidies.

The bureau explained that in order to implement the policy of taking care of the rental needs of the homeless, the President amended and promulgated Article 17 of the Income Tax Act on January 3, 2014, changing the housing rental expense item to a special deduction so that taxpayers who choose the standard deduction can also report it, and the upper limit of the deduction is increased from NT$120,000 to NT$180,000. In addition, additional provisions for excluding the rich were set (those whose applicable tax rate for the comprehensive income tax return of the current year is above 20%, dividends are taxed separately at a rate of 28%, or whose basic income exceeds NT$7.5 million are not eligible). Taking into account some special circumstances in practice, although people own houses, they still need to rent another house to live in. The Ministry of Finance issued Order No. 11304656750 on December 3, 2014, which explains 5 special circumstances, including houses damaged by disasters, inherited shared houses and the total share of the people is not all, and the people need to rent houses in other places for employment, schooling, medical treatment, etc., and the total house owned is only one house (see the attachment). People's own houses can still be regarded as not their own houses, and they can still claim special deductions for house rental expenses if they rent another house.

The bureau gave an example. Mr. A owns a house in Taipei City. His children, B and C, attended universities in Hsinchu and Taichung respectively in 2014 and rented houses near the schools. The annual rental expenses of B and C were NT$120,000 and NT$96,000 respectively, totaling NT$216,000. If Mr. A, his spouse and dependent immediate family members only own one house in total, they can report a special deduction of NT$180,000 for house rental expenses.

The bureau reminds that when taxpayers declare house rental expense deductions, they should attach the house rental contract, a copy of the rent payment certificate, and a household registration at the rented address or a affidavit stating that the house is for self-residence and not for business or execution of business (choose one of the two). If the house meets the five circumstances determined by the Ministry of Finance as non-self-owned housing, relevant supporting documents (see attachment) should be attached for review by the National Tax Bureau. If you have any questions, please use the smart customer service "National Tax Assistant" to inquire online, or call the toll-free service number 0800-000-321 for inquiries. The bureau will serve you wholeheartedly.

(Contact person: Section Chief Su of the Inheritance Tax Group of the Institute; Tel: 2311-3711 ext. 1560)