Chinese Homeowners Getting Divorced to Avoid Stricter Capital Gains Tax

Chinese Homeowners Getting Divorced to Avoid Stricter Capital Gains Tax
Apr 08, 2013 By eChinacities.com

On February 26, the State Council issued new regulations aimed at reigning in the country’s bubbling property market, including a capital gains tax increase from 1-2 percent to 20 percent on all second home sales after March 1. However, hundreds of couples that own two properties have found a unique work-around to the new stricter tax rules: get divorced.

According to current state regulations, couples with two properties who divorce and put each property under one name can sell them tax-free, after which time they can remarry. The phenomenon caused by the tax loophole is now being referred to as getting a “fake divorce” in Chinese social media. 

It appears that thousands of couples have taken advantage of the loophole and gotten “fake divorces”. According to The marriage registration office in Tianjin’s Nankai district, during the month of March, it handled 501 divorce cases. At its peak, the clerks say, couples were lined up out the door, with some getting there at 03:00 or 04:00 to queue up.

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Keywords: china fake divorce

1 Comments

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beerdad

Is it really necessary to get divorced to avoid stricter capital gain tax? As far as I know, the Congressional Republicans have ordered a Congressional Research Service report erased, evidently because it conflicts with their ideological views on taxes. The report found that lower tax rates actually have nothing to do with financial growth. Source of article: https://www.personalmoneynetwork.com why not even undertake your hair a enjoy and have a look on each of our blog site?

Sep 05, 2013 16:14 Report Abuse