Recently, Mr. Wu from Taiwan sold a property in Pudong New District, Shanghai, and planned to go back to retire with Mrs. Wu. However, when he was preparing to remit the sale proceeds back to Taiwan, he did not know how to remit the funds legally. And he heard that he would have

Recently, Mr. Wu from Taiwan sold a property in Pudong New District, Shanghai, and planned to go back to retire with Mrs. Wu. However, when he was preparing to remit the money from the sale of the house to Taiwan, he did not know how to repatriate the funds legally. , and heard that high taxes will be paid after remittance. Mr. Wu was in trouble and came to consult the editor.

I believe that Taiwan compatriot friends in mainland China will definitely encounter the same problem, so the editor will take this opportunity today to explain to you how to remit the money back to Taiwan in the most cost-effective way after selling the house.

First of all, after Taiwanese people sell real estate in mainland China, they can remit the sale price back to Taiwan in one go by applying for foreign exchange purchase. For the specific foreign exchange purchase process, please refer to the editor’s previous article on foreign exchange purchase... (end of article There are links to related articles)

Today we will focus on the most cost-effective way to pay taxes when funds are returned to Taiwan. Currently, when repatriating house sales to Taiwan, in addition to previous interpretation orders, Taiwan has implemented a new preferential tax rate under special laws in 2019. Therefore, there are currently two taxation methods: interpretation orders and special laws.

1. Interpretation order , based on whether documents proving the original purchase cost and expenses are provided, are divided into:

With documents proving the cost and expenses:

Tax amount = (Income from house sales - Original purchase cost) * Comprehensive income tax rate - progressive difference

No cost Expenses supporting documents:

Taxable amount = House sale income * Real estate transaction income rate * Comprehensive income tax rate - progressive difference

Among them, the comprehensive income tax rate is based on the actual amount, and the tax rate is between 5% and 40%.

2. The special law (Special Law on the Repatriation of Overseas Funds) came into effect on August 15, 2019. According to whether the funds have substantial investment, they are divided into:

There is substantial investment: tax amount = income from house sales * 4%~5 %

No substantial investment: tax amount = income from house sales * 8%~10%

Compared with the tax rates of previous interpretation orders, the special law tax rate is indeed very preferential, but the special law is only valid for two years, and for investment There are special requirements for projects and deposit and withdrawal cycles.

Let’s take Mr. Wu as an example. The transaction price of the property he sold this time was 9.5 million. The original purchase price was 4.5 million. He wanted to remit the funds back to Taiwan in one go. According to the needs of different taxation methods The tax amounts paid are:

Note: The amounts in the table are all in ten thousand yuan; the exchange rate of and will change, and the specific tax amount shall be based on the latest exchange rate;

It can be seen that although the tax rate of is more favorable, according to In Mr. Wu’s actual situation, it is most cost-effective to pay tax through an explanation without proof of cost expenses.

He Jianqun-Cross-Strait real estate expert

[Related articles]

Foreign compatriots from Hong Kong, Macao and Taiwan, check it out! What should you pay attention to when remitting funds from selling a house abroad?

How do Taiwanese compatriots in Shanghai buy a house and settle foreign exchange to enter the country and sell a house to purchase foreign exchange out of the country?

How do Taiwan compatriots remit the funds obtained from selling real estate in the mainland back to Taiwan?

If a Taiwanese resident sells a house in the mainland, what tax will he pay when remitting the money back to Taiwan?

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