Preferential tax policies for housing transactions have been further expanded. On the evening of November 18, the Beijing Municipal Housing and Urban-Rural Development Commission, the Beijing Municipal Finance Bureau, and the Beijing Municipal Taxation Bureau jointly issued the "Notice on Matters Concerning the Cancellation of Ordinary Housing Standards" to cancel the standards for ordinary housing and non-ordinary housing.
After the standards for ordinary housing and non-ordinary housing are cancelled, if an individual will sell a house that has been purchased for more than 2 years (including 2 years), the value-added tax will be exempted. If an individual will sell a house that has been purchased for less than 2 years, a 5% tax will be charged. Pay VAT at full rate. The "Notice" will come into effect on December 1, 2024.
Highlights:
No longer distinguish between ordinary housing and non-common housing
The biggest highlight of the "Notice" is that it no longer distinguishes between ordinary housing and non-ordinary housing. The Third Plenary Session of the 20th Central Committee of the Communist Party of China clearly stated that each city government should be fully empowered with autonomy in real estate market regulation and implementation of city-specific policies.
In December 2023, Beijing optimized the identification standards for ordinary housing that have been used for many years since 2014, clarifying that from January 1, 2024, ordinary housing should meet three conditions: the floor area ratio of residential areas is 1.0 (inclusive) )above; The building area of a single unit is less than 144 square meters (inclusive); the actual transaction price is lower than the determined price standard, of which the unit price within the fifth ring road is less than 85,000 yuan per square meter, and the unit price between the fifth and sixth ring roads is less than 65,000 yuan per square meter. , the unit price outside the Sixth Ring Road is less than 45,000 yuan per square meter.
On November 13, the Ministry of Finance, the State Administration of Taxation, and the Ministry of Housing and Urban-Rural Development issued the "Announcement on Tax Policies to Promote the Stable and Healthy Development of the Real Estate Market" (hereinafter referred to as the "Announcement"). The "Notice" issued by Beijing this time has the same statement on deed tax as the "Announcement".
Specifically, if an individual purchases the only home for a family with an area of 140 square meters or less, the deed tax will be levied at a reduced rate of 1%; if the area is more than 140 square meters, the deed tax will be levied at a reduced rate of 1.5%. If an individual purchases a second home for a family with an area of 140 square meters or less, the deed tax will be levied at a reduced rate of 1%; if the area is more than 140 square meters, the deed tax will be levied at a reduced rate of 2%.
It is worth noting that before December 1, if the value-added tax and deed tax involved in individual sales and purchase of houses have not been declared and paid, the applicable provisions of the "Announcement" and "Notice" can be implemented.
Accounting:
Improved house purchase value-added tax
can save six figures
In second-hand housing transactions, the identification standards for ordinary housing are linked to tax incentives, the most important of which is value-added tax. According to the current policy, individuals who sell ordinary residences that are more than 2 years old are exempt from value-added tax; individuals who sell non-ordinary residences that are more than 2 years old are still required to collect differential value-added tax at a tax rate of 5%. Some market institutions estimate that about 30% of the residential buildings in Beijing are still considered non-ordinary housing.
“After Beijing’s common housing standards are cancelled, as long as the housing is more than two years old, it will be exempt from value-added tax when it is sold.” A real estate agent in Beijing told reporters.
After the new policy is implemented on December 1, how much cost can be saved by buying a house in Beijing? Take Mr. Deng, a citizen, as an example. Because his family has a second child, he wants to replace a house with an area of 138 square meters. The house payment is about 8 million yuan. Before the policy adjustment, the house was deemed to be non-ordinary housing. The landlord purchased it for 5 million yuan 6 years ago, and Mr. Deng had to pay a value-added tax of 150,000 yuan. After the policy adjustment, all this value-added tax can be saved.
In terms of deed tax for individual housing purchases, if Mr. Deng is the only home in the family, the deed tax before adjustment is 120,000 yuan, and after this adjustment it is 80,000 yuan, saving 40,000 yuan. If it is a second home, the deed tax before the adjustment was 240,000 yuan, and after this adjustment it was 80,000 yuan, a saving of 160,000 yuan.
analysis:
adapts to new changes in the supply and demand relationship of real estate
"The current real estate supply and demand relationship has undergone major changes. According to housing It is not reasonable to use area, floor area ratio and house price to determine the standard of ordinary housing and non-ordinary housing,” said Zhao Xiuchi, dean of Beijing-Tianjin-Hebei Real Estate Research Institute of Capital University of Economics and Business, who previously bought a small house in Beijing with a small area. It is also often "luxury-oriented" and buyers bear higher transaction costs.
"With the abolition of the standard distinction between ordinary housing and non-ordinary housing, more home buyers will receive preferential policies such as taxation and mortgage loans, and the transaction costs of home buyers will be further reduced." Zhao Xiuchi said that this is not only conducive to the recovery of the property market, but also conducive to residents' appreciation of the good life. The realization of housing wishes gives home buyers a greater sense of gain and happiness.
Since this year, Beijing has successively launched a number of property market policies. Driven by the policies, the transaction activity of Beijing's second-hand housing market has increased in recent times. Statistics from the Beijing Municipal Commission of Housing and Urban-Rural Development show that in October, 17,000 second-hand housing units were signed online in Beijing, with an average price of 52,300 yuan/square meter, a month-on-month increase of 31% and 2.4% respectively. The number of online signings for 17,000 units also hit a record high of nearly 19 A new monthly high, returning to above the "boom and bust line" for second-hand housing transactions.
Preferential tax policies for housing transactions have been further expanded. On the evening of November 18, the Beijing Municipal Housing and Urban-Rural Development Commission, the Beijing Municipal Finance Bureau, and the Beijing Municipal Taxation Bureau jointly issued the "Notice on Matters Concerning the Cancellation of Ordinary Housing Standards" to cancel the standards for ordinary housing and non-ordinary housing.
After the standards for ordinary housing and non-ordinary housing are cancelled, if an individual will sell a house that has been purchased for more than 2 years (including 2 years), the value-added tax will be exempted. If an individual will sell a house that has been purchased for less than 2 years, a 5% tax will be charged. Pay VAT at full rate. The "Notice" will come into effect on December 1, 2024.
Highlights:
No longer distinguish between ordinary housing and non-common housing
The biggest highlight of the "Notice" is that it no longer distinguishes between ordinary housing and non-ordinary housing. The Third Plenary Session of the 20th Central Committee of the Communist Party of China clearly stated that each city government should be fully empowered with autonomy in real estate market regulation and implementation of city-specific policies.
In December 2023, Beijing optimized the identification standards for ordinary housing that have been used for many years since 2014, clarifying that from January 1, 2024, ordinary housing should meet three conditions: the floor area ratio of residential areas is 1.0 (inclusive) )above; The building area of a single unit is less than 144 square meters (inclusive); the actual transaction price is lower than the determined price standard, of which the unit price within the fifth ring road is less than 85,000 yuan per square meter, and the unit price between the fifth and sixth ring roads is less than 65,000 yuan per square meter. , the unit price outside the Sixth Ring Road is less than 45,000 yuan per square meter.
On November 13, the Ministry of Finance, the State Administration of Taxation, and the Ministry of Housing and Urban-Rural Development issued the "Announcement on Tax Policies to Promote the Stable and Healthy Development of the Real Estate Market" (hereinafter referred to as the "Announcement"). The "Notice" issued by Beijing this time has the same statement on deed tax as the "Announcement".
Specifically, if an individual purchases the only home for a family with an area of 140 square meters or less, the deed tax will be levied at a reduced rate of 1%; if the area is more than 140 square meters, the deed tax will be levied at a reduced rate of 1.5%. If an individual purchases a second home for a family with an area of 140 square meters or less, the deed tax will be levied at a reduced rate of 1%; if the area is more than 140 square meters, the deed tax will be levied at a reduced rate of 2%.
It is worth noting that before December 1, if the value-added tax and deed tax involved in individual sales and purchase of houses have not been declared and paid, the applicable provisions of the "Announcement" and "Notice" can be implemented.
Accounting:
Improved house purchase value-added tax
can save six figures
In second-hand housing transactions, the identification standards for ordinary housing are linked to tax incentives, the most important of which is value-added tax. According to the current policy, individuals who sell ordinary residences that are more than 2 years old are exempt from value-added tax; individuals who sell non-ordinary residences that are more than 2 years old are still required to collect differential value-added tax at a tax rate of 5%. Some market institutions estimate that about 30% of the residential buildings in Beijing are still considered non-ordinary housing.
“After Beijing’s common housing standards are cancelled, as long as the housing is more than two years old, it will be exempt from value-added tax when it is sold.” A real estate agent in Beijing told reporters.
After the new policy is implemented on December 1, how much cost can be saved by buying a house in Beijing? Take Mr. Deng, a citizen, as an example. Because his family has a second child, he wants to replace a house with an area of 138 square meters. The house payment is about 8 million yuan. Before the policy adjustment, the house was deemed to be non-ordinary housing. The landlord purchased it for 5 million yuan 6 years ago, and Mr. Deng had to pay a value-added tax of 150,000 yuan. After the policy adjustment, all this value-added tax can be saved.
In terms of deed tax for individual housing purchases, if Mr. Deng is the only home in the family, the deed tax before adjustment is 120,000 yuan, and after this adjustment it is 80,000 yuan, saving 40,000 yuan. If it is a second home, the deed tax before the adjustment was 240,000 yuan, and after this adjustment it was 80,000 yuan, a saving of 160,000 yuan.
analysis:
adapts to new changes in the supply and demand relationship of real estate
"The current real estate supply and demand relationship has undergone major changes. According to housing It is not reasonable to use area, floor area ratio and house price to determine the standard of ordinary housing and non-ordinary housing,” said Zhao Xiuchi, dean of Beijing-Tianjin-Hebei Real Estate Research Institute of Capital University of Economics and Business, who previously bought a small house in Beijing with a small area. It is also often "luxury-oriented" and buyers bear higher transaction costs.
"With the abolition of the standard distinction between ordinary housing and non-ordinary housing, more home buyers will receive preferential policies such as taxation and mortgage loans, and the transaction costs of home buyers will be further reduced." Zhao Xiuchi said that this is not only conducive to the recovery of the property market, but also conducive to residents' appreciation of the good life. The realization of housing wishes gives home buyers a greater sense of gain and happiness.
Since this year, Beijing has successively launched a number of property market policies. Driven by the policies, the transaction activity of Beijing's second-hand housing market has increased in recent times. Statistics from the Beijing Municipal Commission of Housing and Urban-Rural Development show that in October, 17,000 second-hand housing units were signed online in Beijing, with an average price of 52,300 yuan/square meter, a month-on-month increase of 31% and 2.4% respectively. The number of online signings for 17,000 units also hit a record high of nearly 19 A new monthly high, returning to above the "boom and bust line" for second-hand housing transactions.
Reporter: Yuan Lu
Source: China News Weekly
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