Is the income from sale of a house subject to personal income tax in Vietnam in 2025? How to calculate personal income tax for income from sale of a house of Vietnamese residents?

Is the income from sale of a house subject to personal income tax in Vietnam in 2025?

Based on Clause 5, Article 2 of Circular 111/2013/TT-BTC, the incomes subject to tax are defined as follows:

Income Subject to Tax

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5. Income from Real Estate Transfers

Income from real estate transfers is the income received from the transfer of real estate, including:

a) Income from the transfer of land use rights.

b) Income from the transfer of land use rights and assets attached to the land. Assets attached to the land include:

b.1) Residential houses, including future houses.

b.2) Infrastructure and constructions attached to the land, including constructions to be formed in the future.

b.3) Other assets attached to the land including assets that are agricultural, forestry, and fisheries products (such as crops, livestock).

c) Income from the transfer of ownership rights of residential houses, including future houses.

d) Income from transferring the right to lease land, water surface.

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Thus, income from the transfer of real estate, specifically residential houses, is subject to personal income tax. Therefore, when income is derived from buying and selling houses, personal income tax must be paid.

>>> Read more: How much tax is paid when buying a house at 300 million VND in Bac Lieu City? The personal income tax rate for buying and selling houses in Bac Lieu City?

Is the income from sale of a house subject to personal income tax in Vietnam in 2025? (Image from the Internet)

How to calculate personal income tax for income from sale of a house of Vietnamese residents?

According to Article 17 of Circular 92/2015/TT-BTC, the basis for tax calculation for income from real estate transfers is as follows:

The basis for calculating tax on income from real estate transfers is the transfer price on each occasion and the tax rate.

Wherein, the transfer price and tax rate are determined as follows:

(1) Transfer Price

- The transfer price for transferring land use rights with constructions on land, including houses, and constructions to be formed in the future is the price recorded in the transfer contract at the time of transfer.

- If the transfer contract does not indicate the land price or if the land price in the transfer contract is lower than the price set by the provincial People's Committee, the transfer price is the price set by the provincial People's Committee at the time of transfer in accordance with land regulations.

- In the case of transferring a house attached to the land, the value of the house, infrastructure, and architectural works attached to the land is determined based on the registration fee calculation price for houses prescribed by the provincial People's Committee.

If the provincial People's Committee does not stipulate the registration fee calculation price for houses, reference the regulations of the Ministry of Construction on house classification, standards, basic construction norms, and the actual remaining value of the projects on the land.

(2) Tax Rate

The tax rate on real estate transfers is 2% of the transfer price or the sublease price.

(3) Tax Calculation Method

Personal income tax on income from real estate transfers is calculated as follows:

Personal income tax payable = Transfer price x tax rate (2%)

Additionally, if the real estate transferred is co-owned, the tax obligation is determined separately for each taxpayer according to their real estate ownership share.

The basis for determining the ownership share is legitimate documents such as the original capital contribution agreement, wills, or court division decisions, etc.

In the absence of legitimate documents, each taxpayer's tax obligation is determined according to the average ratio.

What are cases where real estate transfers are exempt from personal income tax in Vietnam?

Based on Article 4 of the Personal Income Tax Law 2007 (supplemented by Clause 3, Article 2 of the Law Amending and Supplementing a Number of Articles of Various Laws on Tax 2014 and Clause 2, Article 1 of the Amended Personal Income Tax Law 2012), the personal income tax exemption is regulated in the following cases:

Income Exempt from Tax

1. Income from real estate transfers between spouses; birth parents with biological children; adoptive parents with adopted children; in-laws with daughters-in-law; in-laws with sons-in-law; grandparents with grandchildren; siblings with each other.

2. Income from the transfer of residential houses, homestead land use rights, and assets attached to the homestead land of individuals in cases where the individual possesses only one residential house, homestead land.

3. Income from the value of land use rights allocated by the State to individuals.

4. Income from inheritance, gifts being real estate between spouses; birth parents with biological children; adoptive parents with adopted children; in-laws with daughters-in-law; in-laws with sons-in-law; grandparents with grandchildren; siblings with each other.

5. Income of households and individuals directly engaged in agricultural, forestry, salt production, and aquaculture not yet processed into other products or only through preliminary processing.

6. Income from the conversion of agricultural land of households and individuals allocated by the State for production.

7. Income from interest on deposits at credit institutions, interest from life insurance contract.

8. Income from remittances.

9. Portion of night shift salary, overtime pay that is higher than the day shift salary as regulated by the law.

10. Pension distributed by the Social Insurance Fund; monthly pension from a voluntary pension fund.

11. Income from scholarships, including:

a) Scholarships awarded from the state budget;

b) Scholarships from domestic and international organizations under their scholarship programs.

12. Income from compensation of life insurance contracts, non-life insurance, compensation for workplace accidents, State compensation, and other compensations according to legal regulations.

13. Income from charitable funds authorized or recognized by competent state bodies, operating for charity, humanitarian purposes, non-profit motives.

14. Income from foreign aid for charitable, humanitarian purposes in both governmental and non-governmental forms, endorsed by competent state agencies.

15. Income from wages, salaries of Vietnamese seafarers working for foreign shipping companies or Vietnamese international shipping companies.

16. Income of individuals who own, possess the right to use boats and those working on boats from the provision of goods, services directly serving offshore fishing activities.

Thus, the real estate transfer cases exempted from personal income tax are:

- Income from real estate transfers between spouses; birth parents with biological children; adoptive parents with adopted children; in-laws with daughters-in-law; in-laws with sons-in-law; grandparents with grandchildren; siblings with each other.

- Income from transferring residential houses, homestead land use rights, and assets attached to the homestead land in cases where the individual has only one residential house, homestead land.

- Income from the value of land use rights allocated by the State to individuals.

- Income from inheritance, gifts being real estate between spouses; birth parents with biological children; adoptive parents with adopted children; in-laws with daughters-in-law; in-laws with sons-in-law; grandparents with grandchildren; siblings with each other.