The National Taxation Bureau of the Northern Area （NTBNA）, MOF, indicated that, to further implement tax fairness and alleviate the financial burden on renting households, Article 17 of the Income Tax Act has been amended to include a new “Special Deduction for Rental Housing,” which will effectively reduce the tax liability for renters while ensuring a fair tax system.

     The NTBNA stated that, rent for housing in the R.O.C. paid by a taxpayer, his or her spouse, and lineal dependents and used as their own residence rather than for business or performing professional services, may be deducted from their consolidated income up to a limit of NT$180,000 per year per tax return, not including government subsidy. However, no deduction shall be made for taxpayers, their spouse, or lineal dependents who own a house in the R.O.C.

     The NTBNA further clarified that the Ministry of Finance issued an interpretation on December 3, 2024, outlining five specific situations where taxpayers, their spouse, or lineal dependents may still be eligible for the special deduction for rental expenses, even if they own a house. These situations consider cases where there is a legitimate need to rent elsewhere. In such instances, their owned property will be considered “non-self-owned housing” for the purpose of this deduction.

     For renters who do not own a house in Taiwan, the NTBNA advises that to claim the special deduction for rental expenses for the 2024 tax year, the following documents must be submitted:
     1. Photocopies of the lease contract and payment receipts （such as a receipt from the landlord, ATM receipts, or remittance paper）.
     2. The certificate of a family member that the taxpayer, his or her spouse, or lineal dependent(s) maintained the household registration at the address of the leased house during the taxable year, or an affidavit from the taxpayer declaring that the leased house was used for self-used residence only rather than for business or performing professional services during 2024.

     The NTBNA emphasizes that the special deduction for rental expenses includes an “anti-avoidance clause” and does not apply to individuals who meet any of the following conditions:
     1. Taxpayers applying a tax rate of 20％ or higher on their consolidated income tax return.
     2. Taxpayers opting for a separate taxation of dividends at a 28％ rate.
     3. Taxpayers whose basic income, calculated under the Income Basic Tax Act, exceeds the prescribed deduction amount （NT$7,500,000 for the 2024 tax year）.

     For any inquiries regarding the above information, please call the toll-free service number 0800-000321. The NTBNA will provide detailed consultation services.
〔Contact person: Ms. Chiu, Section Head of Individual Income, Estate and Gift Tax Division；Tel:（03）3396789, ext. 1430〕