On September 15, China’s first specialized administrative regulation on housing rental activities, the “Housing Rental Regulation,” will officially take effect. This regulation focuses on addressing long-standing issues in the rental market, such as fake listings and arbitrary security deposit deductions, aiming to create a healthier and more orderly housing rental environment.
However, as the implementation date approaches, many have linked the regulation to a so-called “landlord tax,” sparking widespread speculation and discussion. Some claim that tax burdens will increase, while others worry that rents will rise as a result. Multiple regions have debunked such claims.
What exactly is the so-called “landlord tax”? What specific provisions does the “Housing Rental Regulation” include? What taxes are involved in renting out housing in China?
The “Housing Rental Regulation” is unrelated to taxation
No new “landlord tax” has been added
Online discussions about the so-called “landlord tax” mainly stem from interpretations of Articles 8 and 30 of the “Housing Rental Regulation.”
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Article 8 stipulates that landlords must, in accordance with regulations, file housing rental contracts with the local real estate management authorities through the housing rental management service platform or other means.
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Article 30 mentions that county-level and above local government real estate management departments should use the housing rental management service platform to conduct management and services such as contract filing, rental housing information management, and statistical monitoring, and establish information-sharing mechanisms with civil affairs, natural resources, education, market supervision, financial management, public security, taxation, statistics, and other departments.
Some interpret “filing” and “information sharing” as implying comprehensive taxation of landlords. In response, it has been clarified that the regulation’s introduction is unrelated to taxation. The core content of the regulation is to standardize the housing rental market order and protect the legitimate rights and interests of tenants and landlords, not to increase tax burdens.
Tax authorities have also debunked rumors about the so-called “landlord tax” and “tax increases.” The Chengdu Municipal Taxation Bureau of the State Taxation Administration stated that the corresponding tax policies for renting out housing have been in place for decades and have not been adjusted due to the regulation’s introduction. There is no new “landlord tax.” Promoting rental information filing through the regulation is essentially about standardizing the tax process, not suddenly “increasing taxes.”
What taxes are involved in renting out housing?
In China, tax rules for rental income have long existed. The taxes involved in renting out housing by individuals cover multiple categories, including value-added tax, property tax, personal income tax, and additional fees.
Any business activity may generate taxes. To facilitate taxpayers, especially individuals renting out housing, local tax authorities typically use a simplified consolidated collection method, meaning these taxes are collected together.
For example, for individuals renting out residential properties with monthly rents not exceeding 100,000 yuan, Beijing and Shanghai impose a comprehensive tax rate of 2.5%. In Guangzhou, Guangdong, for self-owned housing rentals with rents between 2,000 and 30,000 yuan, a comprehensive tax rate of 4% is applied. In Chengdu, Sichuan, for individuals renting out housing who file through the Chengdu Housing Rental Transaction Service Platform, a comprehensive tax rate of 0% is applied. These comprehensive tax burdens are far lower than the rumored “20% to 30%.”
The “Housing Rental Regulation” standardizes housing rental activities in multiple aspects, including conditions for renting out housing, rights and obligations of both parties, and the behavior of housing rental enterprises and brokerage agencies. As China’s housing rental market continues to develop and improve, the rights and interests of both tenants and landlords will be better protected, and the market will operate in a healthier and more orderly manner.
Contract filing is a basic standardized process in housing rental transactions, not aimed at collecting taxes or monitoring listings and contracts. The introduction of the “Housing Rental Regulation” is more about protecting the rights and interests of tenants and landlords, better promoting rental business processes, and playing a positive role in the high-quality development of the entire housing rental market.
