Exemption/Tax Relief Information


This document was prepared by the Real Property Assessment Section of the Department of Finance, County of Kauai, to assist Kauai property owners seeking information on home exemptions. It explains how to qualify for exemptions that reduce the net taxable assessed value of the property used in determining the property tax.


The first home exemption law was enacted in 1896 by the Republic of Hawaii to provide some tax relief, encourage home ownership and the settlement of land. In 1896, the home exemption amount was $300. Currently, the homeowner's exemption is $220,000. This means that $220,000 is deducted from the assessed value of the property and the homeowner is taxed on the balance. For homeowners 60 years and older, an additional age exemption is applied.

Who Qualifies for the Home Exemption?

You are entitled to the home exemption if:

  1. You own and occupy the property as your principal home ("real property owned and occupied as the owner's principal home") means occupancy of a home in the county with the intent to reside in the county. Intent to reside in the county is evidenced by, but not limited to.: occupancy of a home in Kauai county for more than 271 calendar days of a calendar year; registering to vote in the county; filing annual Hawaii Residential Income Taxes (N-11) with a Kaua'i County Address, holding a Hawaii Driver's License or State ID, or being stationed in the county under military orders of the United States, with a reported address in the county;
  2. Your ownership is recorded at the Bureau of Conveyances, State Department of Land and Natural Resources, in Honolulu on or before SEPTEMBER 30th preceding the tax years for which you claim the exemption. In the case of a lease, the document must indicate that the lessee has a lease for residential purposes for a term of fifteen years or more and will pay all property taxes;
  3. You file a claim for home exemption (Form P-3) with the Real Property Assessment Division on or before SEPTEMBER 30th preceding the tax years for which you claim the exemption.
  4. You filed a State of Hawai'i Income Tax (N-11) return for the prior year.

Claim for Home Exemption

Homeowners or lessees, defined as Homeowners under Chapter 5.A-11.4 (a) and up until 60 years of age, will be eligible for a home use exemption of $220,000. Only one exemption is allowed. For a taxpayer who is at least sixty (60) years of age, but not yet seventy (70) years of age, the amount of one hundred eighty thousand dollars $240,000. For a taxpayer who is seventy (70) years of age or over, the amount will automatically increase to two hundred thousand dollars $260,000 A husband and wife shall not be permitted exemption of separate homes owned by each of them, unless they are living separate and apart, pursuant to a court issued separation order in which case they shall be entitled to one-half (1/2) of one (1) exemption, for a maximum period of two (2) years;


NOTE: You are required to contact the Real Property Assessment office should you change your status, such as moving, renting and/or using any portion of your residence as a business within 30 days.

Additional Home Exemption Based on Owner-Occupant's Income

The exemption claim must be filed each year by SEPTEMBER 30th. Results in an additional $120,000 Exemption & reduces the Refuse Collection fee by 1/2. Applicants are required to have an approved Home Exemption. Qualification for $120,000 Additional Income Exemption based upon an annual gross income of ALL of the owner-occupant(s) not to exceed the qualified gross income ceiling (80% of the Kauai Median Household Income) for that year. The income used for qualifying is the Federal & the State of Hawaii gross income from the year preceding the date of application. YOU MUST APPLY ANNUALLY FOR THIS ADDITIONAL EXEMPTION.

Very Low-Income Tax Credit

Homeowners with household incomes that do not exceed 50% of the Kaua‘i Median Household Income published by the Kaua‘i Housing Agency for the calendar year preceding the application, shall be entitled to a credit equal to the difference between the calculated market taxes and 3% of the combined gross income of ALL Titleholders on the property. Applicant must have a current home exemption, taxes must be current, and the amount of the credit cannot result in lowering the annual property taxes below the minimum tax. YOU MUST APPLY ANNUALLY FOR THIS ADDITIONAL TAX CREDIT.

Disabled Veterans

If you are at least 80% disabled veteran, due to injuries received while on active duty with the U.S. Armed Forces, your home is exempted from all property taxes except the minimum tax of $150. The home exemption under Section 5A-11.4 has been established by a disabled veteran will be valid as long as the veteran claiming the exemption remains disabled or the widow or widower of the disabled veteran remains unmarried and resides on the subject property as their principal residence. For this special exemption, veterans must file a claim on RP Form P-6 and Claim for Home Exemption (P-3) on or before SEPTEMBER 30th.

Blind, Deaf, Totally Disabled or Disabled Veteran

If you have impaired sight or hearing or are totally disabled or Disabled Veteran, you may file a claim on RP Form P-6 for a $50,000 real property tax exemption on property you own. This claim is in addition to the regular or multiple home exemption. Your condition must be certified by a licensed physician of State of Hawaii, a commissioned medical officer in the United States Army, Navy, Marine Corps or Public Health Service. "Certification" will be determined on the basis of a written report resulting from an examination performed by the authorized physician.

The following requirements must be satisfied to qualify for the exemption:

An individual whose eyesight does not exceed 20/200 in the better eye with corrective lenses or whose visual sharpness is greater than 20/200. In this latter case, the field of vision must have a width of 20 degrees or less.

An individual whose average loss in the speech frequencies (500/2,000 hertz) in the better ear is 82 decibels, A.S.A, or worse.

Totally Disabled:
A person who is totally and permanently disabled, either physically or mentally, which results in the person's inability to engage in any substantial gainful business or occupation. For example, medically-certified heart attack or stroke victims, unable to engage in any substantial gainful business or occupation may qualify for this exemption.
Once filed and granted, these home and real property exemptions do not have to be filed annually, as long as all requirements continue to be met. 

Disabled Veteran:
A person who is a disabled veteran and is less than eighty percent (80%) disabled due to injuries received while on duty as a member of the armed forces of the United States shall, so long as he or she is disabled, be exempt from real property taxes on all real property owned by him or her up to, but not exceeding a taxable value of fifty thousand dollars ($50,000). The disability shall be certified on forms prescribed by the Director of Finance. 

If You Sell, Rent or Purchase Another Home

If there is any charge which might affect your home exemption, such as no longer occupying the property as your home, ceasing to own the property, and/or renting the property during the tax year, then you must report the change of exemption status to the Real Property Assessment Section, Department of Finance, County of Kauai. The report must be submitted within 30 days of the change. Failure to file a report within 30 days of any change in status may result in a penalty and additional real property taxes being assessed.

Minimum Real Property Tax

If the total amount of exemptions meet or exceed the net taxable assessment for qualified year, then the minimum tax assessed shall be $150 or $75 when you file and qualify for Additional Exemption Relating to Income.

Home Preservation Limit

A homeowner who meets the criteria in Subsection 5A-11A.2 (c) shall pay real property taxes at the higher of an amount equal to 3% of the combined gross income of all owners or $500.00. The Home Preservation Limit Application must be filed annually on or before September 30.

Long-Term Affordable Rental

Any owner who owns real property that is rented or leased as a long-term affordable rental shall receive the owner-occupied tax rate as provided in Section 5A-6.4 provided that all dwellings on the property are long-term affordable rentals or owner-occupied. Rent levels must not exceed the affordable rental rates established by HUD and reported by the Kaua'i Housing Agency based on 90% of the Kaua'i Median Household Income.