The government will expand the scope of the special rule for one jointly owned dwellings. As a result, couples who own one dwellings in joint names are expected to see their tax burden eased.
On the 25th, according to the government, the Ministry of Economy and Finance plans to revise the enforcement decree of the comprehensive real estate tax law next month to expand the scope of the special rule for one jointly owned dwellings. Under current law, a one-household, one-dwellings owner receives a basic deduction on the comprehensive real estate tax up to 1.2 billion won and is eligible for an elderly and long-term holding tax credit of up to 80%. The main point of the revised enforcement decree is to expand the scope of those eligible for this special rule.
Currently, when a couple jointly owns one dwellings, one of them can be designated as the taxpayer for that dwellings. If the taxpayer is the husband and the husband inherited the dwellings, the one-dwellings special rule still applies. However, if the wife, who is not the taxpayer, inherits the dwellings, she is classified as owning multiple dwellings and is not eligible for the deemed one-household, one-dwellings special rule.
When the amendment takes effect, even if the wife in the above example inherits the dwellings, she will be able to receive the 1.2 billion won basic deduction and the elderly and long-term holding tax credit. However, if it is judged that the existing method of a combined basic deduction of 1.8 billion won for the couple is more favorable, they may choose that option.
An official at the Ministry of Economy and Finance (MOEF) said, "With the revision of the enforcement decree, (couples with one jointly owned dwellings) will be able to choose between the '1.8 billion won basic deduction' and '1.2 billion won basic deduction + up to 80% elderly and long-term holding tax credit.'"