Taxes and fees when foreigner buys house in Vietnam

The law of Vietnam does not distinguish between tax obligations and fees when buying a house between Vietnamese and foreigner. When foreigner buys house in Vietnam, they may be applied to the following taxes and fees:

Tax payable

• Value Added Tax: 10% of apartment selling price
• Sinking fund: 2% of apartment selling price
• Registration Tax for Ownership Certificate: 0.5% of apartment value
• Personal Income tax (Resale): 2% of transacted value
• Person Income tax (Rental income): 5% VAT & 5% Personal Income Tax on revenue
• Business License Tax: VND 1 million per year if rental income exceeds VND 1.5 million per month

Value Added Tax (VAT)

The VAT is only applicable when buying condominiums on the primary market. It is usually 10% of the unit value.

Maintenance Fee

The Maintenance fee or Sinking Fund is paid by the buyer on the completion of the payment schedule. The buyer has to pay an additional 2% of the unit value as the Sinking Fund.

Registration Fee

Before the buyer is issued with the ownership certificate, they have to pay 0.5% of the purchase value as the registration fee.

Rental Income Tax

If you are buying a house to let, you will incur two types of taxes that are paid jointly. You have to pay a VAT of 5% plus a personal income tax of 5%, totaling 10% as the rental income tax.

Capital Gains Tax

This is one of the hidden costs that foreign property buyers should know, though the tax does not exist theoretically. When selling your property, you need to pay 2% of the gains as your income tax.  This fee can be agreed upon by the buyer or seller.

Land Tax

Even though foreigners cannot buy land in Vietnam, they still have to incur a land tax of between 0.03 to 0.15% when buying any landed projects. This means you should consult your real estate agency or property lawyer to understand how to deal with such hidden costs..

In addition to the above fees, to ensure safety when buying a house in Vietnam. Some foreigners may pay an extra fee to hire a personal consultant or lawyer to check, select a project/apartment and assist with the purchase procedure.