Taipei City Revenue Service

Part 1 Calculating the land value increment tax
I. Calculating the total land increments value
It entails taking the current value declared in the land property transfer proceedings at the time of deeds transfer, minus the current value declared in the previous transfer (or an originally designated land value), times the current consumer price index, in which any land improvement cost shall be subtracted from.
1. Declaring the current transfer value: The current value declared in the transfer proceedings may be taken from either one of the following two cost factors.
(1)Total contract price: The cost as it appeared in the property closing contract between the buyer and seller, referring to the actual property closing cost.
(2)Present land value: The present land value per square meter released by government land administration authorities on January 1 once a year times the acreage of property to be transferred. Nevertheless, if the total contract price assessed falls below the present land value, the property can either be acquired by government authorities as per the declared total contract price, or have a land value increment tax levied as per the present land value.
2. The present value declared in the previous transfer, or an original decreed land value:
(1)It entails either the present value declared with tax authorities in the previous transfer of a land, or based on the original decreed value assessed by government authorities if the land has never been transferred.
(2)The adaptation of either the present value declared in the previous transfer or the original decreed value subject to adjustment based on the latest consumer price index for the Taiwan region.
3. Cost of land improvements consists of the following categories:
(1) Cost of land improvements.
(2) Development surcharge already paid.
(3) Cost of land rezoning.
(4) Published present value on a fixed percentage of land donated at no charge from land used on public facilities, because of the change of land use.

II. Formula for calculating theamount of Land Value Incremental Tax payable
1. Tax rate on regular land
The tax rates on regular land under the land value increment tax come in 3 classes.

Remarks:
a= Total amount of Land Value Increment
b= Originally set land price or the reported value of last transfer (adjusted per consumer price index. )
* Note
Reduction tax rate ＝ Original tax rate －【(Original tax rate – Min. tax rate) × reduction ratio】
1. If held more than 20 years, reduction ratio is 20%
Class 2 tax rate: 28%＝30%－【(30%-20%) × 20%】 and the original accumulative
difference 10% reduced to be 8% at the same time
Class 3 tax rate: 36%=40%-【(40%-20%) × 20%】 and the original accumulative
difference 30% reduced to be 24% at the same time
2. If held more than 30 years, reduction ratio is 30%
Class 2 tax rate: 27%=30%-【(30%-20%) × 30%】 and the original accumulative
difference 10% reduced to be 7% at the same time
Class 3 tax rate: 34%=40%-【(40%-20%) × 30%】 and the original accumulative
difference 30% reduced to be 21% at the same time
3. If held more than 40 years, reduction ratio is 40%
Class 2 tax rate: 26%=30%-【(30%-20%) × 40%】 and the original accumulative
difference 10% reduced to be 6% at the same time
Class 3 tax rate: 32%=40%-【(40%-20%) × 40%】 and the original accumulative
difference 30% reduced to be 18% at the same time

III. Filing Deadline
At the time a land ownership is to be transferred, the buyer and seller are required to declare a present land value in a formal transfer proceedings with local land administration authorities no later than 30 days from the date of contract. A late filing will be subject to a land value increment tax assessed by government land authorities based on the present published land value on the date the proceeding is received at the land administration authorities.