Real Estate Tax Mini-Class
Taiwan LVIT (Land Value Increment Tax) Cheat Sheet
Compiled from publicly available guidance by the Ministry of Finance and local tax authorities
💡 When transferring land or a house, the tax people often find the most confusing is Land Value Increment Tax.

What is Land Value Increment Tax? Key Points at a Glance

Land Value Increment Tax (LVIT) is imposed on the “natural increase” in land value. When land ownership is transferred or a dian right (mortgage pledge) is created, the tax authority calculates the tax based on the announced land value, holding period, and land use.

Scope & taxpayer Owner-occupied 10% preferential rate Progressive 20 / 30 / 40% Once-in-a-lifetime · One-house benefit Eligible agricultural land may apply for exemption
Quick Formula (Concept)
Total Land Value Increment =
Current announced land value − Original land value (CPI-adjusted)
  • ● Tax applies to the “natural increase,” not the full price.
  • ● Standard rates are progressive: 20% / 30% / 40%.
  • ● If owner-occupied conditions are met, you may apply for the 10% preferential rate.
Final tax is subject to local tax authority assessment. This page is for conceptual reference only.

1. What Land Value Increment Tax Means Basics

LVIT is levied on land with a regulated/announced value when ownership is transferred or a dian right is created, and it taxes only the “natural increase” in land value. If there is no increment, there is no LVIT.

1) When LVIT is triggered

  • Compensated transfers such as sale, exchange, and government purchase/expropriation.
  • Gratuitous transfers such as gift or bequest.
  • Creation of a dian right on land with regulated value (tax may be pre-collected on creation; paid tax may be refundable upon redemption under certain rules).
Sale Gift / Bequest Government purchase / expropriation Dian right

2) Who is the taxpayer?

  • Compensated transfer (sale/exchange): generally the original landowner.
  • Gratuitous transfer (gift/bequest): generally the acquirer of the land.
  • Dian right: generally the party who creates the dian (the landowner/transferor).
  • Trust land: during the trust period, for compensated transfer or dian creation, the trustee is generally responsible.

Practical note: Land administration agents often assist with filing, but the statutory taxpayer is still the party listed above.

3) Filing timeline & process (concept)

  • Filing deadline: generally within 30 days from the contract date (sale/gift/dian), filed with the local tax authority where the land is located.
  • What you file: transfer land value, original acquisition basis, and whether you apply for owner-occupied benefits or agricultural-land exemption, etc.
  • Assessment & payment: after assessment, you pay the tax bill; transfer registration typically requires proof of payment.

If filing is late, assessment may be based on the announced land value in effect when the tax authority receives the case, which can affect the final amount.

2. How LVIT Is Calculated Base & Rates

Two core elements drive the calculation: Total land value increment and the applicable tax rate.

1) Total land value increment (tax base)

Conceptually:

Total land value increment = “Announced land value at transfer” − “Original assessed/announced land value (CPI-adjusted)”

In practice, the tax authority uses published figures such as announced land values and CPI adjustment factors—this is not simply the difference between purchase and sale prices.

2) Standard progressive rates (20% / 30% / 40%)

In standard cases (without owner-occupied preference), the total increment is subject to progressive rates of 20%, 30%, and 40% based on increment multiples. For long holding periods, certain brackets may qualify for reductions.

For understanding only. Final assessment follows the local tax authority.
Tier (concept) Increment multiple (concept) Nominal rate Notes
Tier 1 Increment below 100% of the original value 20% Lowest tier for smaller increases.
Tier 2 Increment exceeds 100% but below 200% 30% (may be reduced by holding years) For holdings exceeding 20/30/40 years, reductions may apply per rules.
Tier 3 Increment exceeds 200% or more 40% (may be reduced by holding years) Highest tier with heavier tax burden.

3) Owner-occupied residential land preferential rate (10%)

If the transferred land qualifies as owner-occupied residential land and you apply for the preferential treatment, LVIT may be taxed at a single 10% rate instead of the progressive 20%–40%.

  • The building on the land is owned by the landowner, spouse, or lineal relatives.
  • Household registration is completed before sale, and the property has not been rented out or used for business within the required period.
  • Area limits apply (e.g., up to 3 ares in urban areas and up to 7 ares in non-urban areas, subject to rules).

Practical review details vary slightly by locality. Before filing, confirm with the local tax authority or a professional.

4) “Once in a lifetime,” “one house,” and repurchase refund (high-level)

  • Once in a lifetime: one time in a person’s life, selling qualifying owner-occupied residential land may apply the 10% rate.
  • One-house benefit: related preferential recognition and usage limits tied to owner-occupied conditions (commonly referred to as “one house”).
  • Repurchase tax refund: after selling qualifying owner-occupied residential land, if you repurchase qualifying owner-occupied land within a specified period, you may apply for a partial or full refund of LVIT paid (subject to rules).

These benefits involve detailed conditions (time limits, area limits, family/registration rules). Always check the latest laws and local announcements before applying.

5) Simplified example (concept only)

Example: CPI-adjusted original assessed value is NT$5,000,000 and the announced value at transfer is NT$11,000,000. The total increment is roughly NT$6,000,000. If everything fell into one bracket (simplified):

  • Standard 20%: 6,000,000 × 20% ≈ 1,200,000
  • Owner-occupied 10%: 6,000,000 × 10% ≈ 600,000

Actual assessment may differ due to progressive tiers, differential amounts, and holding-year reductions. This example is purely to illustrate the direction of change.

3. When Can LVIT Be Reduced or Exempt? Tax Planning

LVIT is not always “heavy.” If statutory conditions are met, the burden can be reduced.

1) Long holding periods may reduce part of the tax

If the land has been held for more than 20, 30, or 40 years, certain reductions may apply to Tier 2 and Tier 3 portions, lowering the effective rate for long-term holders (subject to rules).

2) Owner-occupied residential land → 10% rate

If the land meets area, actual use, household registration, and non-rental/non-business conditions, you may apply for the 10% preferential rate.

3) Eligible agricultural land used for farming → may apply for non-levy

To support the “agricultural land for agricultural use” policy, qualifying agricultural land may apply for LVIT non-levy upon transfer (subject to rules).

Common requirements include:

  • The land is classified as agricultural land and is actually used for agricultural production.
  • The applicant meets statutory identity/usage requirements and provides supporting documents.

Standards vary by locality. Check with the local tax authority before applying.

↩ Back