1. What is real estate tax?

Real estate tax is an indirect tax, applied to houses, residential land, and construction land.

Real estate tax in English is:“Land & housing tax”.

2. Subjects subject to real estate tax:

All land not used for agricultural purposes is subject to real estate tax.

Subjects subject to real estate tax can be listed as follows:

– Land located in urban and rural residential areas includes: land where houses have been built, land for gardens, ponds, paths, yards, including vacant land around the house. Normally, this land is the land area registered on the family's red card number.

In the case of land that has not yet been built on housing but has been granted a permit, real estate tax must still be paid.

– Land for construction of traffic works, housing projects, or construction of aquaculture model systems (all land within the project scale including surrounding parts such as regulating lakes, working areas) amusement parks in urban areas).

For projects that have been registered but not yet built, they still have to pay real estate tax.

3. Subjects exempt from real estate tax:

Some of the following subjects are not subject to real estate tax, even though they are not used for agricultural purposes, including:

– Land used for public purposes, social welfare projects, and charity projects such as: land for roads, land for cemeteries, land for schools, stadiums.

– Land used for religious and worship purposes such as: communal houses, pagodas, shrines, religious houses, family houses.

4. Real estate tax payers:

– The person paying real estate tax is the person who owns or has the right to use land within the taxable area. When something happens land use right Transfer, individuals and organizations receiving the transfer will have to find people responsible for paying real estate tax according to regulations.

– Every year, taxpayers pay real estate tax in 2 periods, no later than May 30 for the first period and October 30 for the second period. Taxpayers can pay twice a year or pay once for the entire year in the first tax payment period.

– Some businesses apply the method of paying taxes on a stable cycle (every 5 years), then pay no later than December 31 of the requested year. In case of overpayment of real estate tax, the excess amount will be carried over to the next tax payment period.

5. Current real estate tax rates:

The calculated real estate tax rate will depend on the following factors:

– Taxable land area: For a household, the amount of real estate tax payable is usually based on the land area on the red book. In addition, for families using common land on one plot, the real estate tax amount is the actual area used by each family.

– Price of one square meter of land: The price of one square meter of land will be regulated by competent authorities and may change within a 5-year cycle. In case there is a change in land use purpose, the price of one square meter of land will be regulated at the time of transfer and stable for the remaining cycle.

– Tax rate: Tax rate for real estate tax will be applied according to the progressive tax schedule. As follows :

+ Area within limit: 0.03%

+ Area exceeding 3 times the limit: 0.07%

+ Area exceeding 3 times the limit: 0.15%

The allowable land limit depends on each area. Currently, it is divided into 5 limits. For wards, the maximum allowed land limit is 90 square meters. For communes adjacent to the city area, the maximum allowable land limit is 120 square meters. For communes in the delta, the land limit is 180 square meters. For communes in the midland region, the land limit is 240 square meters. Finally, for mountainous communes, the land limit is 300 square meters.

6. Types of taxes that land users may have to pay:

6.1. When issuing the Certificate for the first time:

Land use fees

– Case 1: No land use fees are required

If a household or individual uses land stably and has documents on land use rights as prescribed in Article 100 of the 2013 Land Law, Article 18 of Decree 43/2014/ND-CP, they do not have to pay use fees. land.

– Case 2: Must pay land use fee

Registration fee

Pursuant to Article 5 and Article 6 of Decree 140/2016/ND-CP amended and supplemented by Clause 1, Article 1 of Decree 20/2019/ND-CP, the registration fee when issuing the Certificate for the first time is calculated. as follows:

Registration fee payable = (Price of 1 square meter of land in the Land Price List x Area) x 0.5%

+ The price of 1 square meter of land to calculate the registration fee is the land price in the Land Price List issued by the People's Committee of the province or centrally run city at the time of registration fee declaration.

+ The land area subject to registration fee is the area for which the Certificate is issued.

Document appraisal fee

Normally, provinces and cities will not collect this fee when issuing a Certificate for the first time (only some provinces and cities collect it).

Certificate issuance fee

Collection rates:

– Usually from 100,000 VND/paper/issue or less (only a few provinces collect 120,000 VND).

– Fee levels between provinces are different.

6.2. When changing land use purpose:

Land use fees

– Case 1: No land use fees are required, including:

+ Converting annual crop land to other agricultural land includes: land used to build greenhouses and other types of houses for farming purposes; land to build barns for raising cattle, poultry and other animals as permitted by law; aquaculture for learning and experimental research purposes.

+ Converting land for growing other annual crops and aquaculture land to growing perennial crops.

+ Converting land for growing perennial crops to land for aquaculture and land for growing annual crops.

+ Converting residential land to non-agricultural land that is not residential land.

+ Converting commercial and service land to non-agricultural production and business land that is not commercial or service land; converting non-agricultural production and business land that is not commercial or service land or land for non-agricultural production establishments to land for construction of public works.

– Case 2: Must pay land use fee

Certificate issuance fee

Fee: Normally less than 100,000 VND/paper/issue

6.3. When transferring or donating land:

Registration fee

Registration fee is a fee used for buying, selling, transferring, donating, and inheriting, applied to those who receive property through declaration and payment to tax authorities before putting the property into use.

The recipient of property in a real estate transaction needs to pay registration fees to the competent State agency when registering ownership and use rights of real estate.

Registration tax is divided into two types for land and housing:

– For land, registration fee = Price of 1 square meter at Land Price List x Area x 0.5%

– For housing, registration fee = (Price of 1 square meter of land x Area x Remaining quality percentage) x 0.5%

Registration fee declaration dossiers are submitted to the agency receiving dossiers to handle registration procedures, the place that issues house use rights, land use rights or assets attached to land according to the provisions of the Land Law. .

personal income tax

According to the law, the person who is obliged to pay personal income tax is the income earner (seller). However, in many cases of real estate transactions and transfers, the seller and buyer can discuss to come to an agreement on who will pay this type of real estate tax.

How to calculate real estate tax for income earners is as follows:

Personal income tax payable = Transfer price x 2%

In particular, the transfer price is the price agreed upon by the buyer and seller and clearly stated in the contract.

Document appraisal fee

Document appraisal fees are specified in Clause 1, Article 5 of Circular 250/2016/TT-BTC as follows:

– For subjects who need to appraise real estate transfer documents, the appraisal fee is collected when registering for a Certificate of real estate use rights. This is an amount of money to offset the costs of document appraisal and other conditions for the State to grant real estate ownership and transfer real estate.

– The fee for dossier appraisal is set by the People's Council of each province and city.

– For competent State agencies to directly conduct appraisal in the transfer of use rights and ownership of real estate, only the application appraisal fee will be applied.

Certificate issuance fee

– Must be submitted if applying for a new Certificate.

– The fee is less than 100,000 VND/paper/issue.

6.4. When using land (no name transfer):

Tax calculation formula:

Tax amount payable = (Taxable land area x Price of 1 square meter of land x Tax rate) - Tax amount to be exempted or reduced (if any)

When people only use land (not transfer, donate, etc.), they must pay land use tax, unless exempted.

– Cases exempt from agricultural land use tax include:

+ Agricultural land use tax exemption for all agricultural land areas serving research and experimental production; annual crop land area with at least one rice crop per year; area of ​​land for salt production.

+ Agricultural land use tax exemption for the entire agricultural land area for the following subjects:

Households and individuals are assigned and recognized land by the State for agricultural production and receive transfer of agricultural land use rights (including inheritance and donation of agricultural land use rights).

Households and individuals who are members of agricultural production cooperatives, farm farms, and forestry farms have received stable land allocation from cooperatives, state-owned farms, state-owned forestry farms, and households. Individuals receive stable land allocation from agricultural and forestry companies for agricultural production according to the provisions of law.

Farm and forestry staff include: Officials, workers, and employees working for state-owned farms and state-owned forestry farms; Households with people working for state-owned farms, state-owned forestry farms or who have retired or lost their working capacity are entitled to the benefits of residing in the area; Households with direct needs for agricultural, forestry, and aquaculture production residing in the area.

Households and individuals engaged in agricultural production contribute their agricultural land use rights to establish agricultural production cooperatives according to the provisions of the Cooperative Law.

+ Agricultural land use tax exemption for all agricultural land areas allocated or recognized by the State for poor households.

– Exempt casesNon-agricultural land use tax:

+ Land of investment projects in fields with special investment incentives (special investment incentives); Investment projects in areas with particularly difficult socio-economic conditions; Investment projects in the field of investment promotion (investment incentives) in areas with difficult socio-economic conditions; land of enterprises employing more than 50% of the workers are war invalids and sick soldiers.

+ Land of establishments carrying out socialization activities in the fields of education, vocational training, health, culture, sports, and environment include:

Non-public establishments are established and qualified to operate according to regulations of competent State agencies in the fields of socialization;

Organizations and individuals operating under the Enterprise Law that have investment projects, joint ventures, associations or establish establishments operating in socialized fields are eligible to operate according to regulations;

Public service establishments contribute capital, mobilize capital, enter into joint ventures and associations according to the provisions of law to establish independent accounting establishments or enterprises operating in socialized fields according to regulations. determination;

For foreign investment projects in the field of socialization, the Prime Minister decides on the basis of the request of the Ministry of Planning and Investment and relevant specialized management ministries.

+ Land to build houses of gratitude, houses of great solidarity, facilities for nurturing lonely elderly people, disabled people, orphans, and social treatment facilities.

+ Residential land within the quota in areas with particularly difficult socio-economic conditions.

+ Residential land within the limits of revolutionary activists before August 19, 1945; wounded soldiers ranked 1/4, 2/4; People who enjoy policies such as war invalids of class 1/4, 2/4; sick soldier class 1/3; heroes of the people's armed forces; Vietnam heroic mother; biological father, biological mother, people who had the merit of raising martyrs when they were young; spouses of martyrs; Children of martyrs are receiving monthly benefits; Revolutionary activists were infected with Agent Orange; People infected with Agent Orange whose family circumstances are difficult.

+ Residential land within the limit of poor households according to the Prime Minister's Decision on poor household standards. In case the Provincial People's Committee has specific regulations on poverty standards applied locally according to regulations, the poverty standards issued by the locality will be based on the poverty standards issued by the locality to determine poor households.

+ Households and individuals who have residential land recovered in the year according to planning and plans approved by competent State agencies are exempt from tax in the year of actual recovery for land at the recovered place and land at new residence.

+ Land with a garden house is certified by a competent agricultural agency as a historical-cultural relic

+ Taxpayers encounter difficulties due to force majeure events if the value of damage to land and houses on land is over 50% of the taxable price.

Taxpayers must have confirmation from the People's Committee of the commune where the damaged land is located.

+ Households and individuals whose non-agricultural land use tax must be paid annually (after deducting tax exemptions or reductions (if any) according to regulations) are 50 thousand VND or less.

In case a household or individual has many plots of land within a province or centrally run city, the tax exemption according to this regulation is calculated on the total tax payable on all land plots.