Unpaid Taiwan tax can stall a property transfer even during a challenge

A taxpayer sought re-examination of a supplementary individual income-tax assessment of a little over NT$3.6 million, the Central Area National Taxation Bureau reported in an October 15, 2026 press release. The tax remained unpaid, no equivalent security had been provided, and the bureau notified the land and motor-vehicle authorities to register a restriction on disposing of property in the taxpayer's name.

If a sale or mortgage of Taiwan property is coming up, can it still be registered while the assessment is under challenge? The bureau's October 15 press release answers part of that. Contesting the assessment does not, on its own, stop the tax from counting as unpaid, and it does not lift a restriction placed to secure its collection. The bureau's example is one individual's income tax; the release says nothing about company tax debts or company officers' own property.

What re-examination puts on hold

Under Article 39 of the Tax Collection Act, when tax is still unpaid 30 days after the payment period ends, the tax office refers it for compulsory execution. When the taxpayer has applied for re-examination under the Act's procedure, the office temporarily defers that referral. That pause covers the referral only. Article 39 says nothing about lifting other collection safeguards while the review runs.

That is what happened in the bureau's October 15 example: re-examination was already pending when the restriction was registered. The taxpayer objected that property should not be restricted while the tax was still being contested. The bureau's answer: tax not paid by the deadline is in arrears, challenged or not. The release does not say how the challenge or the objection turned out, or whether any sale or transfer was planned.

Two timetables run side by side: one for the tax challenge, one for the transfer. A filed challenge may explain why an execution referral is on hold, but it cannot serve as proof that the land or vehicle record is clear. When the signing or registration date is fixed, the restriction notice and the registry entry are what show whether the transfer can go through.

A safeguard tied to the unpaid amount

Under Article 24(1)(1), if a taxpayer has not paid tax by its due date, the tax office may notify the relevant authorities that the taxpayer's property, up to a value equal to the tax owed, may not be transferred or have other rights, such as a mortgage, created over it. It also says the restriction does not apply where equivalent security has already been provided. The power is discretionary: the office decides whether to use it, and an unpaid bill does not lead to a registration by itself.

In the same October 15 release, the bureau says a restriction can be registered once arrears reach what it calls a certain amount (一定金額), but it gives no figure. Article 24(1)(1) itself does not state one. The amounts that appear later in Article 24 apply to exit bans, a separate measure, not to property restrictions.

What is actually blocked? The statutory notice bars any transfer of the identified property and any new right over it. For a buyer, lender or other transferee, the practical questions are whether the deal involves a transfer or a new right over the property, and whether the land or vehicle authority has recorded a restriction. The tax office's notice and the registry record show which property is affected; the bureau's general example cannot answer that for any particular deal.

How a registered restriction comes off

For a taxpayer who needs to transfer the restricted property, the bureau's October 15 guidance is to pay the outstanding tax in full or provide equivalent security. The tax office would then ask the relevant authority to cancel the registered restriction. The release gives no timeframe for the cancellation, which matters when a closing date is already fixed.

Article 24(2) lists when the tax office must lift a restriction already in place, to the extent the release ground covers it. One ground is equivalent security supplied by the taxpayer or by a third party. Another is a tax assessment challenged through an administrative remedy and finally cancelled on administrative appeal or in administrative litigation, a stage a pending re-examination has not reached.

There is a narrow exception to release after cancellation. If the cancelled assessment must be decided again and there are indications that the taxpayer is hiding or transferring property to evade tax execution, Article 24(2) says the restriction is not lifted. Both conditions must be present.

With security, the question is whether the tax office will treat what is offered as equivalent to this debt. Raising the proposed security with the tax office well before the transfer date leaves time to learn whether it will be accepted. Article 24(2) lets someone else put up the security, but the registration stays until the tax office has the registry cancel it.

A different test follows the re-examination decision

Once the re-examination decision is out, Article 39(2) gives three ways to keep a deferred case from being referred for compulsory execution. The first is to pay one third of the tax due under that decision and file an administrative appeal in accordance with law. A taxpayer for whom that one-third payment is genuinely difficult may instead furnish equivalent security, with the tax office's approval.

The third route applies when both paying the one third and furnishing equivalent security are genuinely difficult. That route is open only if the tax office has already notified the relevant authority under Article 24(1)(1) that the taxpayer's property equal in value to the tax due under the re-examination decision may not be transferred or have new rights created over it. Without one of these three alternatives (and filing the next challenge is not a fourth), Article 39 directs referral for compulsory execution.

Of the three, only this route needs neither a payment nor security; what holds the referral back is the transfer restriction itself. For anyone who needs to sell or borrow against that property, that is the trade-off.

How we can help

Hovering International Law Firm (昊鼎國際法律事務所) can review the assessment, the status of the challenge and the registry record before a planned transfer. Attorney Wei Tseng (曾雋崴) handles consultations. Send the name of the tax office, the property involved and the planned transfer date to wei@hoveringlaw.com.tw, and we can weigh the payment and security options against that timetable.

Taipei office: 7F-2, No. 35, Sec. 1, Chengde Rd., Datong Dist., Taipei City 103, Taiwan Taichung office: 6F-1, No. 19, Guanqian Rd., North Dist., Taichung City 40453, Taiwan

Sources

• Central Area National Taxation Bureau press release, October 15, 2026: individual income-tax example and guidance on removing a property restriction.
• Tax Collection Act, Article 24, checked October 16, 2026: preservation measure, value limit, security exception and release grounds.
• Tax Collection Act, Article 39, checked October 16, 2026: deferral of referral for compulsory execution and the three post-re-examination alternatives.

Checked: October 16, 2026.