Business

New tax on land, property transfers

People who transfer land use rights and ownership of houses and apartments will be subject to a tax of 25 percent on their income from the transactions, said the Ministry of Finance.
People who transfer land use rights and ownership of houses andapartments will be subject to a tax of 25 percent on their income fromthe transactions, said the Ministry of Finance.

The newtax rate was stipulated in Circular 113/2011/TT-BTC, recently issued bythe Ministry of Finance. The circular also outlines ways to calculatepersonal income tax including income tax on real estate transactions.

Under the new circular, organisations and individuals payingcommissions, salaries, wages and other service charges valued at morethan 1 million VND per transaction will have the tax deducted beforepaying their general income tax. Deductions are applied at a rate of 10percent for individuals who have tax file numbers and 20 percent forthose without tax file numbers.

Purchasing contracts forhouses or apartments signed before Decree 71/2010/ND-CP on theimplementation of the Law on Housing came into effect on 23 June, 2010,have to pay 25 percent of their personal income tax.

Forthe transfer of purchasing contracts on housing to be built in thefuture, people making tax declarations will be subject to a tax of 25percent on their income./.
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