The Dajyh Office, National Taxation Bureau of the Central Area, Ministry of Finance (hereinafter “the Office”) stated that starting from January 1, 2024, for taxpayers, their spouses, and dependent direct relatives renting a residence in Taiwan for self-occupation—and not for business or professional use—the annual deduction ceiling for housing rental expenses per reporting household has been increased from NT$120,000 to NT$180,000 (after subtracting any government subsidies). This deduction has been reclassified from a standard deduction to a special deduction. However, individuals who own property in Taiwan are not eligible for this deduction. This measure aims to alleviate the burden on renters and fulfill the goal of addressing the housing needs of citizens.

The office explained that considering taxpayers, their spouses, or dependent direct relatives who own property but still have a need to rent another residence, the following five special circumstances allow the property to be deemed as not self-owned, thereby qualifying for the special deduction of rental expenses:

1. Homes publicly designated for demolition or labeled as dangerous following emergency evaluations under the Disaster-Damaged Buildings Assessment Regulations.

2. Properties with damage exceeding 50% of the total building area, certified by the local government as requiring repairs before use.

3. Shared inheritance properties, where the taxpayer, spouse, or dependents do not hold full ownership.

4. Cases where the taxpayer, spouse, or dependent direct relatives need to rent a residence in a different location due to employment, education, or medical reasons, and collectively own only one property (including co-owned property) aside from those mentioned in the first three points, used for self-occupation and not for business or professional purposes.

5. Where the taxpayer and spouse file taxes separately under eligibility requirements for legally recognized marital separation, and the spouse owns a home.

The office further explained that if a taxpayer’s property meets the above recognition criteria, he(she) may submit relevant supporting documents during the filing of the 2024 comprehensive income tax return for verification by the tax authorities.

The office also reminded that the special deduction for housing rental expenses is subject to an exclusion clause for high-income individuals. It does not apply to those whose comprehensive income tax return for the year is subject to a tax rate of 20% or higher, whose dividends are taxed separately at a 28% rate, or whose basic taxable income, calculated under the Income Basic Tax Act, exceeds NT$7.5 million (for the 2024 tax year).

If you have any questions, please call our toll-free service number 0800-000321 for consultation, and we will do our best to serve you.

Contact person: Dajyh Office, Individual Income Tax Section, Ms. Chang
Tel: (04)22612821 ext.213