The government said on the 3rd it will temporarily ease, for two years starting next year, the capital gains tax surcharges on dwellings sold by multiple-home owners in designated adjustment areas. All of Seoul and 15 areas in Gyeonggi Province are currently designated as adjustment areas. When a multiple-home owner sells a dwelling in these areas, the basic capital gains tax rate (6%–45%) is surcharged by 20 percentage points for owners of two dwellings and 30 percentage points for owners of three dwellings.
The Ministry of Economy and Finance, in its "2026 tax reform plan," said it will temporarily ease, from 2027 to 2028, the capital gains tax surcharges on multiple-home owners' dwellings in adjustment areas to provide selling opportunities following the normalization of the comprehensive real estate holding tax. This measure can also apply to dwelling transactions sold this year that were subject to the higher surcharge rates, if a preliminary or final return is filed next year.
◇ For owners of two dwellings, if they sell in Seoul or Gyeonggi next year, the capital gains surcharge rate goes from 20%P → 5%P
Currently, the surcharge rate for owners of two dwellings is 20 percentage points, but it will be temporarily reduced to 5 percentage points next year and 10 percentage points the following year. In 2029, it will revert to 20 percentage points. For owners of three dwellings, the surcharge will drop from the current 30 percentage points to 10 percentage points next year and 15 percentage points the following year. In 2029, it will return to 30 percentage points.
For example, if an owner of two dwellings sells a dwelling in an adjustment area with an expected capital gain of 500 million won, about 270 million won in tax is due now because the surcharge applies. According to the government, under the eased surcharge, the capital gains tax would be 200 million won next year and 220 million won the following year.
◇ For single-dwelling owners aged 65 or older, sell in the Seoul metropolitan area next year and move to a non-metropolitan region to get up to 500 million won off capital gains tax
Starting next year for two years, the government will introduce a temporary special provision in the Act on Restriction on Special Cases Concerning Taxation to reduce capital gains tax by 30%–50% if a single-dwelling owner aged 65 or older sells a dwelling in the Seoul metropolitan area and moves to a non-metropolitan region. To qualify, the seller must have lived in the dwelling for at least five years. The dwelling must also be sold to a third party, not to a related party.
If these conditions are met and the person decides to move to a non-metropolitan region within six months, the capital gains tax can be reduced by up to 50% for sales next year and 30% the following year. The cap is 500 million won next year and 300 million won the following year. For jointly owned dwellings, the cap applies according to the equity ratio. If the move is not made within six months, the tax benefit will be clawed back. In addition, if the person returns to the metropolitan area or buys a metropolitan dwelling within five years after selling, the tax will be clawed back. If a household member repurchases the disposed dwelling within five years, the tax will also be clawed back.
◇ Temporary owners of two dwellings must sell within two years to get "single-dwelling special treatment"... shortened from three years
People who become temporary owners of two dwellings in an adjustment area through a dwelling purchase will have to sell their existing dwelling within two years to receive single-dwelling special treatment. The special-treatment period will be shortened from three years to two. Under current law, even if a single-dwelling owner buys a dwelling in an adjustment area and becomes a temporary owner of two dwellings, if the existing dwelling is transferred within three years, the capital gains tax and property tax rules apply as for a single-dwelling owner. As criticism mounted that this benefit was excessive, the special-treatment period will be reduced.
Benefits such as excluding multiple-home owners from capital gains tax surcharges on purchased rental apartments in adjustment areas and applying a 50% long-term holding deduction will be phased out. The exclusion from the surcharge will be maintained only through next year. The following year, owners of two dwellings will be surcharged 10 percentage points and owners of three dwellings 15 percentage points, and from 2029 they will be surcharged 20 percentage points and 30 percentage points, respectively, the same as other multiple-home owners. The 50% long-term holding deduction will also be maintained through next year, reduced to 30% the following year, and eliminated in 2029.