Does the Transfer of Land Use Rights Incur VAT?
Is the transfer of land use rights subject to VAT?
According to Article 4 of Circular 219/2013/TT-BTC, supplemented by Clause 2, Article 1 of Circular 26/2015/TT-BTC, the subjects not subject to VAT are specified as follows:
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Salt products produced from seawater, natural rock salt, refined salt, and iodized salt whose main component is Sodium Chloride (NaCl).
State-owned houses sold by the State to the tenants.
6. Transfer of land use rights.
- Life insurance, health insurance, student insurance, and other insurance services related to humans; pet insurance, crop insurance, other agricultural insurance services; insurance of ships, boats, equipment, and other necessary tools directly serving aquatic exploitation; reinsurance.
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Thus, according to the above provisions, the transfer of land use rights is one of the subjects not subject to VAT. When your father prepares the documents to transfer the land use rights to you, it will be exempt from VAT.
Are there any cases where the transfer of land use rights is exempt from personal income tax (PIT)?
According to Article 4 of the Law on Personal Income Tax 2007, supplemented by Clause 3, Article 2 of the Law on Amendments to Tax Laws 2014, taxable income is specified as follows:
- Income from the transfer of real estate between spouses; biological parents and biological children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; grandparents and grandchildren; grandparents and grandchildren; siblings with each other.
2. Income from the transfer of houses, land use rights of homestead land, and assets attached to homestead land by individuals who have only one house or homestead land.
Income from the value of land use rights granted by the State to individuals.
Income from inheritance, gifts which are real estate between spouses; biological parents and biological children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; grandparents and grandchildren; grandparents and grandchildren; siblings with each other.
Income of households and individuals directly engaged in agricultural production, forestry, salt production, aquaculture, and fishing that has not been processed into other products or has only undergone preliminary processing.
Income from the conversion of agricultural land by households and individuals granted by the State for production.
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Therefore, the case of being exempt from personal income tax for the transfer of land use rights is when individuals have only one homestead land.
Respectfully!
