What are the conditions for non-agricultural land use tax exemption for households and individuals in Vietnam?

What are the conditions for non-agricultural land use tax exemption for households and individuals in Vietnam?

Under Clause 10, Article 10 of Circular 153/2011/TT-BTC (supplemented by Article 4 of Circular 130/2016/TT-BTC):

Tax Exemption

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10. A household or individual shall be exempted from the annual tax on non-agricultural land use if the tax payable, after reduced owing to any tax exemption or deduction as per the Law on taxation of non-agricultural land use and guiding documents, is fifty thousand Vietnam dongs or less. If such household or individual has several land parcels in a province, the exemption of the tax on non-agricultural land use, according to this Article, shall be based on the total tax payable on all land parcels. The procedure for exemption of non-agricultural land use tax, according to this Article, is governed by the Circular No. 153/2011/TT-BTC.

A household or individual who has paid the tax on non-agricultural land use to the state budget though being eligible for exemption of such tax as per this Circular, shall receive a refund of the tax from tax authorities according to the Law on tax administration and guiding documents.

Thus, households and individuals whose non-agricultural land use tax payable is below 50,000 VND per year are eligible for tax exemption.

What are the conditions for non-agricultural land use tax exemption for households and individuals in Vietnam? (Image from the Internet)

What are the principles for non-agricultural land use tax exemption and reduction in Vietnam?

According to Article 9 of Circular 153/2011/TT-BTC, the principles for exemption and reduction of non-agricultural land use tax are as follows:

- Tax exemption and reduction will only apply directly to taxpayers and be calculated based on the lax amounts payable under the Law on Non-Agricultural Land Use Tax 2010  and Circular 153/2011/TT-BTC.

- Tax exemption and reduction for residential land shall apply only to residential land registered under the name of taxpayers in a locality chosen by themselves, except the cases specified in Clause 9, Article 10, and Clause 4, Article 11 of Circular 153/2011/TT-BTC.

- A taxpayer that is eligible for both tax exemption and reduction for a single land plot may enjoy tax exemption. A taxpayer eligible for tax reduction under two or more conditions specified in Article 11 of Circular 153/2011/TT-BTC may enjoy tax exemption.

In case both the taxpayer and at least one member of his/her household are eligible for a 50% reduction of tax each, the taxpayer's household may enjoy tax exemption. These persons must have grandparent-grandchild or parent-child relations and be named in the household's permanent residence registration book.

- A taxpayer that has many investment projects eligible for tax exemption or reduction may enjoy tax exemption or reduction for each investment project.

What does the application for non-agricultural land tax exemption or reduction in Vietnam include?

According to Article 57 Circular 80/2021/TT-BTC, the application for non-agricultural land tax exemption or reduction in Vietnam include:

- In case of exemption of reduction of annual non-agricultural land use tax payable by a household or individual which is not exceeding 50.000 VND, the application shall contain:

+ The application form No. 01/MGTH in Appendix I hereof;

+ Copies of documents relevant to the land plot on which tax is imposed, such as, the LUR Certificate, land allocation decision, land lease decision or contract, decision to permit land repurposing;

+ Documents of documents proving eligibility for exemption or reduction of non-agricultural land use tax.

The head of the tax authority responsible for the area where the land plot is location shall, on the basis of the application for tax exemption/reduction specified in this Clause, determine the amount of non-agricultural land use tax eligible to exemption or reduction and decide whether to grant exemption or decision.

 In the cases specified in Clause 4, Clause 5, Clause 6 Article 9 and Clause 2, Clause 3 Article 10 of the Law on Non-agricultural Land Use Tax 2010, the head of the tax authority responsible for the area where the land plot is located shall issue a common decision according to the list of eligible taxpayers compiled by the People’s Committee of the commune. Annually, the People’s Committee of the commune shall review and send the list of taxpayers eligible for tax exemption or reduction to the tax authority.

In the cases specified in Clause 9 Article 9 and Clause 4 Article 10 of the Law on Non-agricultural Land Use Tax 2010, the head of the tax authority responsible for the area where the land plot is located shall issue a decision on tax exemption or reduction according to application submitted by the taxpayer and confirmation of the People’s Committee of the commune where the land plot is located.

- In case the annual non-agricultural land use tax payable by a household or individual is not exceeding 50.000 VND, submission of the tax exemption application is not required. The tax authority shall, via TMS application, extract a list of taxpayers eligible for tax exemption and send it to the People’s Committee of the communes where the taxpayers' land is located for comparison and confirmation.