What is the personal income tax rate for apartment transfer in Vietnam?

What is the personal income tax rate for apartment transfer in Vietnam?

According to Clause 2, Article 12 of Circular 111/2013/TT-BTC, which is amended by Article 17 of Circular 92/2015/TT-BTC, specific provisions regarding the personal income tax rate for apartment transfer are as follows:

Basis for Tax Calculation for Income from Real Estate Transfers

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2. Tax Rate

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

3. The time of tax calculation for real estate transfers is determined as follows:

- In cases where the transfer agreement does not stipulate that the buyer is responsible for paying the tax on behalf of the seller, the tax calculation time is when the transfer agreement becomes effective according to the law;

- In cases where the transfer agreement specifies that the buyer is responsible for paying the tax on behalf of the seller, the tax calculation time is when the procedures for registering the ownership rights or the use of real estate are completed. In cases where an individual acquires a future-built house or land use rights associated with future construction, it is when the individual files the tax declaration with the tax authority.

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Therefore, under the above regulation, the buying and selling of an apartment is subject to a personal income tax rate of 2% of the transfer price or the sublease price.

What is the personal income tax rate for apartment transfer in Vietnam? (Image from Internet)

How to calculate personal income tax for apartment transfer in Vietnam?

According to Clause 4, Article 12 of Circular 111/2013/TT-BTC, as amended by Article 17 of Circular 92/2015/TT-BTC, specific provisions on tax calculation are as follows:

- Personal income tax for income from real estate transfers is determined as follows:

- In the case of joint ownership real estate transfers, the tax obligation is determined separately for each taxpayer based on the ownership proportion of the real estate. The basis for determining the ownership proportion is legal documents such as initial capital contribution agreements, wills, or court division decisions, etc. In the absence of legal documents, each taxpayer's tax obligation is determined based on an average proportion.

Which income is exempt from personal income tax in Vietnam?

According to Article 4 of the Law on Personal Income Tax 2007, amended by Clause 2, Article 1 of the Law Amending the Law on Personal Income Tax 2012, provisions on personal income that is exempt from personal income tax are as follows:

- Income from real estate transfers between spouses; biological parents to biological children; adoptive parents to adopted children; parents-in-law to daughter-in-law; parents-in-law to son-in-law; paternal grandparents to grandchildren; maternal grandparents to grandchildren; siblings to each other.

- Income from the transfer of housing, the right to use homestead land, and assets attached to homestead land of an individual in cases where the individual has only one house, one homestead land.

- Income from the value of land use rights assigned by the State.

- Income from inheritance, gifts being real estate between spouses; biological parents to biological children; adoptive parents to adopted children; parents-in-law to daughter-in-law; parents-in-law to son-in-law; paternal grandparents to grandchildren; maternal grandparents to grandchildren; siblings to each other.

- Income of households and individuals directly producing agriculture, forestry, salt production, aquaculture, fishing that has not been processed into other products or only through simple processing.

- Income from the conversion of agricultural land of households and individuals assigned by the State for production.

- Income from interest from deposits at credit institutions, interest from life insurance contracts.

- Income from remittances.

- Nightshift wages, overtime wages received higher than working days wages, wages during working hours as prescribed by law.

- Pension provided by the Social Insurance Fund; pension from a voluntary pension fund paid monthly.

- Income from scholarships, including:

+ Scholarships received from the State budget;

+ Scholarships received from domestic and foreign organizations under their support programs for education and training.

- Income from life insurance compensation, non-life insurance, labor accident compensation, state compensation, and other compensations as prescribed by law.

- Income received from a charitable fund established or recognized by a competent state authority, operating for charitable and humanitarian purposes, not for profit.

- Income received from foreign aid for charitable, humanitarian purposes in government and non-government forms approved by a competent state authority.

- Income from wages and salaries of seafarers who are Vietnamese working for foreign shipping lines or Vietnamese shipping lines operating on international routes.

- Income of individuals who are ship owners, individuals with the right to use ships and individuals working on ships from activities providing goods and services directly serving offshore fishing and catching.