Entity Setup
Taiwan’s Family Trusts and ‘Self-Use’ Home Tax Relief Clarified
Taiwan’s Ministry of Finance has issued new clarifications permitting certain family trusts housing self-use properties to enjoy preferential house and land taxes, increasing fairness in homeownership structures.
By NomadicTax Research Team • 5-8 min read • August 18, 2026
## Background
Trusts, particularly family trusts, are often used in Taiwan for estate planning, asset protection, or managing family-held real estate. Historically, preferential tax rates for **self-use residential property**—lowered land value tax and house tax—were narrowly available. A recent clarification extends these benefits under tight conditions. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai))
---
## Key Features of the Clarification (Issued June 23, 2026)
Under the interpretation order (台財稅字第11504521730號令) by Taiwan’s Ministry of Finance, **trust property (“信託房地”)** may be eligible for **self-use property rates** under both the *Land Tax Act* and *House Tax Act*, provided the following conditions are met:
| Condition | Description |
|---|---|
| Beneficiary Relationship | The beneficiary must be the settlor’s spouse or direct lineal relative, receiving all benefits; the settlor must **not** retain the right to change the beneficiary. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai)) |
| Residence Use | The property must be actually occupied by the settlor, spouse, or direct lineal relatives. Household registration must be completed. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai)) |
| Non-use / Area & Ownership Caps | No portion used for renting or business. Area caps: urban land ≤3 *公畝*, non-urban land ≤7 *公畝*. The family may only have up to 3 self-use homes under these tax-friendly rates. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai)) |
Additional eligibility: The property must be declared under the trust arrangement without provisions for sale or transfer to third parties. Use must remain residential and non-commercial. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai))
---
## Practical Implications & Examples
- **Estate planners**: If you set up a trust to hold a self-use home for your spouse or children, and meet the conditions above, you can enjoy the same tax rates as direct ownership (self-use rates) rather than commercial or vacant property rates.
- **Example**: Alice transfers urban land and a house into a trust naming her children as beneficiaries, with no right to change beneficiaries, and all live in the property. The property is ≤3 *公畝* and they have no other self-use homes. Then Alice’s family may enjoy land price tax at 2‰ and housing tax at 1.2%. Without meeting conditions, rates would be far higher. ([mof.gov.tw](https://www.mof.gov.tw/singlehtml/384fb3077bb349ea973e7fc6f13b6974?cntId=a4c794fbf3774036bb5eb4bc523bb9e1&utm_source=openai))
- **Limitation**: If any part of the property is rented out, or if the beneficiary is allowed to change, or if area limits exceeded, you lose eligibility.
---
## What You Should Do
1. Review existing trust agreements: Confirm if trust agreements contain clauses allowing beneficiary changes; amend if necessary before the qualification becomes mandatory.
2. Check household registration: Ensure proper registration of residence for settlor/beneficiaries.
3. Assess property usage: Avoid renting out any portion if seeking self-use relief.
4. Calculate benefits: Estimate tax saving differences between standard rates vs self-use rates on both land and house taxes.
5. Consult local government tax office: Since this involves house tax / land tax, local authorities’ guidance will be essential.
---
## Why It Matters
- **Fairness**: Aligns with public interest in ensuring homeownership tax relief is accessible even within trust frameworks.
- **Estate & succession planning tool**: Enables more flexibility in structuring family property ownership without losing key tax benefits.
- **Risk management**: Non-compliance with the rules can lead to unexpected tax liabilities or loss of relief.
---
## Conclusion
This clarification by Taiwan’s MoF empowers families using trusts to plan for property ownership while preserving tax relief for self-use homes — as long as they comply with specific conditions. Carefully structured trust agreements and residential use practices will be key.