© Reuters. A large number of regulated areas are levied… The irrelevance of a ‘heavy transfer tax’ for multi-homers
From the 14th of this month, the government decided to lift the adjustment zone for all areas except Seoul, Gwacheon, Seongnam, Hanam, and Gwangmyeong. When the adjustment area is raised, the taxation system, such as acquisition tax, heavy taxation comprehensive real estate tax, heavy taxation and tax-free capital gains tax, etc., will be significantly different.
When donating a house, the acquisition tax rate is 3.8%. A heavy tax rate of 12.4% is applied to houses with an official price of 300 million won or more in the adjustment area. However, this will not be excessive in the case of a gift from a person with one house per household to a spouse or lineal descendant or descendant.
When a multi-homed person sells a house in the adjustment area at the time of transfer, a heavy tax rate is applied. Therefore, when selling a house in a zone that is not an adjustment zone that has been released from an adjustment zone, transfer tax must be paid at the basic tax rate regardless of the number of houses. If a house in the adjustment area is sold by May 9 next year, it will be taxed at the basic tax rate with a temporary exemption from heavy taxation.
If you acquire a house in the adjustment area, tax exemption only applies to one house per household if you have lived there for at least two years during the retention period. However, if it is acquired in an unmodified area, a tax exemption is applied as long as it is held for more than two years. The same is true even if it is re-designated as an adjustment area at the time of the subsequent transfer.
When the transfer tax exemption for two houses is temporarily applied, the disposal period of the old house is extended from 2 years to 3 years if the old house is located in a converted area and that a new house is bought in an area that has not been modified. .
When calculating comprehensive real estate tax, if each person owns three or more houses or two or more houses in a modified area, the heavy tax rate (1.2-6%) is applied instead of the basic tax rate (0.6-3%). For example, if Kim Ha-na (pseudonym) owns two houses, the Seoul house with a public notice of 2 billion won and the Sejong house with a public notice of 1.2 billion won, the basic tax rate is applied, not the heavy rate tax, because Sejong was raised from the adjustment area this time. Accordingly, the comprehensive real estate tax next year is expected to decrease by approximately 20 million won from 37 million won to 17 million won.
Daekyung Kim, Tax Accountant, Wealth Management Group, Hana Bank
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