The Hong Kong government has exceeded the NT$100 billion level for two consecutive years, and the authorities are working hard to find ways to increase revenue for the government. In addition to promoting the event economy to attract tourist funds, wage earners must have noticed that the government has taken measures in taxation. For example, the upper limit of salary tax reduction has been significantly narrowed. If wage earners want to save taxes, they can apply for tax deductions on mortgage interest. If readers plan to take advantage of the low prices to enter the market, they must be aware of this tax-saving method.
For example, the government has significantly narrowed the upper limit of salary tax reduction. From the 2017 to 2020 Budget, the upper limit is NT$20,000, with a maximum reduction of NT$75%. From 2021 to 2022, the upper limit will be narrowed to NT$10,000, with a maximum reduction of NT$100%. Last year, the upper limit was reduced to NT$6,000, and this year it was halved again, leaving the upper limit only NT$3,000, which is a disguised tax increase. As long as the owner still contributes to the property for self-occupation and the property is located in Hong Kong, he can apply for "tax deduction on home loan interest".
Deductible for 20 tax years
The tax deduction limit is up to 100,000 yuan per year, and there are a total of 20 tax years that can be applied for, that is, the tax can be deducted for 20 years.
Since the tax deduction time in these 20 years is flexible, owners can decide when to use or not use it. The following are three common good times to use the property tax deduction.
(1) People who have just bought a property: If the owner just bought the property, the current interest rate is high, and the interest repayment ratio of the main initial payment is high, the chance of exhausting the tax deduction limit is high, naturally. A good time to use tax deductions. And if the owner does not plan to change the property in the future, he can be more bold and continue to use the tax deduction period. After all, the relevant policies may have the opportunity to be extended or tightened in the future. In the early stages of property payment, he can use more tax deductions and retain cash flow. , which is also a prudent approach.
(2) High interest period: If the owner has paid for the property for a short period of time, it is naturally a good time to use it when the current interest rates are high.
Basically, it is not difficult to use up the tax deductions. If Hong Kong further cuts interest rates in the future, and the owner has calculated whether the tax deductions will be used up, he can not use them temporarily or use them later.
(3) The period when the payment increases significantly after changing the property: In addition to the interest rate situation that determines whether to use the tax deduction, if the owner plans to change the property in the short term and also expects that the payment will increase significantly in the future, the tax deduction can be reserved until the property is changed. .
As long as the owner uses it properly, the "home loan interest tax deduction" can indeed save a lot of expenses for the owner and reduce the burden on life.
Tax deduction does not apply to off-the-plan properties
However, it should be noted that since the "tax deduction for home loan interest" does not apply to uncompleted properties, if the owner buys the uncompleted property when the developer has recently slashed the price to sell new properties, he cannot apply for "home loan interest tax deduction" before taking over the property. tax deduction".
Therefore, if you choose to purchase an off-the-plan property immediately, the buyer is not currently eligible to apply for tax deduction.