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)
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) |
| Residence Use | The property must be actually occupied by the settlor, spouse, or direct lineal relatives. Household registration must be completed. (mof.gov.tw) |
| 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) |
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)
Practical Implications & Examples
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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.
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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)
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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
- Review existing trust agreements: Confirm if trust agreements contain clauses allowing beneficiary changes; amend if necessary before the qualification becomes mandatory.
- Check household registration: Ensure proper registration of residence for settlor/beneficiaries.
- Assess property usage: Avoid renting out any portion if seeking self-use relief.
- Calculate benefits: Estimate tax saving differences between standard rates vs self-use rates on both land and house taxes.
- 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.