Family property sales in Seoul, Gyeonggi to face 12 percent tax

Starting next year, family members who buy or sell property at well below market value in designated real estate adjustment zones, including all of Seoul and parts of Gyeonggi Province, will face an acquisition tax of up to 12 percent of the transaction price. The measure follows the government’s Oct. 15 housing policy designating Seoul and parts of Gyeonggi as adjustment zones, and the submission of a bill on the same day classifying low-priced intra-family sales as gifts.

The Ministry of the Interior and Safety said on Oct. 24 that a partial amendment to the Local Tax Act was proposed on Oct. 16. Under the bill, property transactions between spouses or direct relatives, including parents and children, will be considered gifts if the sale price is significantly below market value. The amendment is scheduled to take effect Jan. 1, pending National Assembly approval.

The threshold for determining how far below market value a sale must be is expected to follow the Inheritance and Gift Tax Act. That law classifies sales 30 percent or more below market value as gift transactions, but the final criteria will be set by presidential decree. A ministry official said the government is using inheritance and gift tax rules as a reference and will outline the standards in the enforcement decree by the end of the year.

For example, if a parent sells a Seoul apartment worth 1 billion won to a child for 500 million won, the transaction would be 50 percent below market value and subject to a 12 percent acquisition tax. The buyer would owe 60 million won in tax, while any capital gains tax for the seller would be calculated separately.

The ministry said the amendment is unrelated to recent housing measures. It was first announced in the 2025 Local Tax Reform Plan on Aug. 28 and was open for public comment through Sept. 22.


송진호 jino@donga.com