Hi all,

I recently agreed to sell my place to someone. I've owned it for about 3 years now. Here's the deal. I don't know how much i'll be paying in taxes?
I sold the place in Pudong for around 4.4MM RMB and i've read so much about how China has cut taxes and even Shanghai cut taxes..

The place was 166.39 sq meters so i know it doesn't fall into the "ordinary" category, but that being said, this was the one and only house i have in Shanghai.

Wondering if anyone can give me a breakdown of what the taxes would be NOW... in light of all thats gone on...

cheers

ask your agent. your agents will knowteh current status and what taxes you will need to pay and to whom. They should be able to provide a breakdown.

"ask your agent".. ok that was really helpful! Here's the deal.. some agents know.. and some don't know because they haven't sold a house in ages! sometimes, they just collect their fees and don't know how much the taxes are... As those bozos at Zhong Yuan (Centerline) on Dong Chang lu in Pudong or the now almost bankrupt Pu Jing agency in front of Summit Residences..

Anyway, had a friend who sold his 134sqm apartment in xujiahui. He told me his total fees and taxes amounted to 4.2% of his total price of his house, and that was done in mid-November!

My understanding and correct me if i'm wrong here is this:
The main components of the fees are:

1) Business tax: 5.55% (5.05% for foreigners) of the total housing sale amount (supposedly now scrapped if you owned the place for 2 years or more)

2) Other tax (ge ren suo de shui) - 2% for properties bigger than 90sqm. 1% for 90sqm or below. However, again, if property is the only one you own and owned for 2 years or more, this is scrapped.. ?? perhaps...

3) Commission (1% for both buyer an seller) - hear this can be negotiated

4) Value added tax (tu di zheng zhi fei) - now gone now but heard this could be 0.5% of total housing value if owned less than 3 years, 0.25% if owned between 3-5years and 0% after 5 years.. again, this is gone i hear..

other fees? don't know...

As I understand it from my wife, who is Chinese, The previous system was you pay tax on a NEW place to sale price. In other words 100% of sale price. And that was only selling in less than 5 years.
2nd. hand place: under 5 years sale you had to pay tax on the capital gains. (Fapio required to show purchase price). So tax was paid on difference between buy and sell. I understood in both cases tax was 5.1 %, could well have been 5.5 %, not sure.

As I understand it, and mentioned above, the Shanghai Govt. about a week ago scrapped most taxes, so if you sold after owning for 2 or more years, the capital gains were scrapped on all properties. So the tax liability was changed from less than 5 years to less than 2 years. Good news.

Your apt doesn't meet the requirement to be "ordinary" category since it is more than 140m2. You have to Business Tax, BT.
But if you have owned it for more that 2 yrs you only need to pay BT for the descrepancy.
BT=5%*(Sales Price - Purcharse Price)
You may need to provide the invoice of buying the apt.
Hope that can help you and you may ask the agent to check more details.