Is the land levy paid in case of selling single-family social housing in Vietnam after a 5-year period? How to determine land levy when reselling social housing in Vietnam?

Is the land levy paid in case of selling single-family social housing in Vietnam after a 5-year period?

Based on Article 42 of Decree 100/2024/ND-CP regulating the requirement to pay land levy when reselling social housing after a 5-year period, as follows:

Payment of Land Levy When Reselling Social Housing After a 5-Year Period

For the payment of land levy when reselling social housing that is individual housing after a 5-year period stipulated at point e, clause 1 of Article 89 of the Housing Law, apart from the amounts required by law, the seller must pay 50% of the land levy as stipulated by land law. The time for calculating the land levy is the time when the valid application for recognition of land use rights is submitted, according to land law.

Thus, in cases where single-family social housing is resold after a 5-year period, the seller is required to pay a land levy, and the amount is 50% of the land levy as stipulated by land law.

Is the land levy paid in case of selling single-family social housing in Vietnam after a 5-year period? How to determine land levy when reselling social housing in Vietnam? (Image from Internet)

How to determine the land levy payable when reselling social housing in Vietnam?

Currently, there is no Circular guiding Decree 100/2024/ND-CP or specific guidance on determining the land levy when reselling social housing, so we may refer to how to determine the land levy when reselling social housing as stated in Article 7 of Circular 139/2016/TT-BTC (applicable to cases of selling social housing under clause 4 of Article 19 of Decree 100/2015/ND-CP) as follows:

- The land price for calculating the land levy is determined based on the price of homestead land set by the provincial People's Committee in the Land Price Table multiplied by the land price adjustment coefficient at the time the purchaser, lessee-purchaser resells the social housing.

- Land use fee payable when reselling social housing:

+ In cases where the purchaser, lessee-purchaser of social housing resells a social housing apartment, land levy is payable as follows:

Land Use Fee Payable = 50% x S x Land Price x Allocation Coefficient of Land Levy for the Apartment

Where:

(i) S is the land area of the apartment building for which the land levy needs to be determined.

(ii) Land price is determined according to the provisions of clause 1 of Article 7 of Circular 139/2016/TT-BTC.

(iii) Coefficient of allocation for the apartment building is determined according to the provisions of Article 8 of Circular 139/2016/TT-BTC.

What are the conditions to resell social housing in Vietnam after a 5-Year period?

According to point d, clause 1 of Article 89 of the Housing Law 2023 regulating the sale of social housing as follows:

Sale, Lease Purchase, or Lease of Social Housing

1. The sale of social housing is conducted according to the following stipulations:

a) The sale of future social housing is executed only upon ensuring compliance with clause 3 of Article 88 of this Law; the sale of existing social housing is executed only upon ensuring compliance with clause 4 of Article 88 of this Law;

b) The purchase and sale of social housing must be executed under a contract containing the provisions stipulated in Article 163 of this Law;

c) The advance payment by the purchaser of social housing is executed according to the agreement in the housing sale contract, consistent with the completion rate of housing construction work and approved project schedule, but the first advance payment amount should not exceed 30% of the contract value including any deposit (if applicable), and the total payment amount should not exceed 70% of the contract value prior to housing handover to the purchaser and should not exceed 95% of the contract value prior to issuing the Certificate to the purchaser for the house;

d) The purchaser of social housing is not permitted to resell the housing within a minimum period of 5 years, from the date of complete payment for the house, except for cases stipulated in point e of this clause;

e) Within 5 years from the date the purchaser of social housing has fully paid for the house and has a need to sell this house, it can only be resold to the investor of the social housing construction project or resold to entities eligible to purchase social housing at a maximum price equal to the sale price of this social housing in the purchase contract with the investor of the social housing construction project. The payment of personal income tax adheres to tax regulations;

...

Based on the above provisions, it can be seen that the conditions to resell social housing after a period of 5 years from the date the purchaser of social housing has fully paid for the house are:

- It can only be resold to the investor of the social housing construction project or to entities eligible to purchase social housing;

- The maximum sale price of social housing is equal to the sale price of social housing in the purchase contract with the investor of the social housing construction project.

- Additionally, the seller must also comply with personal income tax obligations according to tax regulations.