Dec. 4 – The State Administration of Taxation has released Circular 639 to further explain individual income tax (IIT) treatments on income derived by individuals from on-letting real property.

According to the circular, income earned from on-letting real property is taxable under the IIT’s property rental category. On-lessor rental given to the landlord is qualified for deduction from the on-letting income for IIT purposes.  Taxpayers should be able to provide the leasing agreement and payment vouchers for reference.

For IIT purposes, the following are qualified for deduction: taxes and fees paid during the on-letting, rentals paid to the landlord and other expenses paid for by the taxpayer for the maintenance of the property.

For help with your individual income tax treatments, email Dezan Shira & Associates at info@dezshira.com