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Vietnam: Taxes and Costs

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Last Updated: Aug 25, 2007

Vietnam has a high flat rental income tax

Rental Income

There is no aggregate income tax in Vietnam. Each category of income (e.g., business income, regular or irregular individual income) is taxed separately, at the applicable tax rate, after deductions and exemptions.

Income Tax

Foreign nationals residing in Vietnam for a period of less than 183 days in any 12 month period are subject to tax at a rate of 25% on Vietnam-sourced income. Business investments in property are also taxed at 25% under the Business Income Tax, and less if the investment is in the form of a BOT. Expenses are deductible if they are matched by relevant income. Interest payments are deductible up to 70% of the capital invested. Depreciation is allowed at 2% to 4% for solid houses and buildings.

Withholding Tax

Withholding tax ("profit repatriation tax") is payable at 7% if the capital is less than US$5 million, if the money is transferred abroad by a foreign economic organization or individuals.

Land and Housing Tax

Land used for the construction of apartments for sale or lease is tax-free.

Capital Gains Tax

Capital gain tax is payable on each sale or transfer of a house or the right to use land in Vietnam by an individual not registered as a real estate agent. The gain is the difference between the selling price and the cost price. The cost price includes the acquisition or construction costs, improvement costs, transfer costs, and other costs incurred before the sale or transfer of the property took place.

Nonresident foreigners earning capital gains from selling Vietnamese property is taxed at a flat rate of 25%.

Transfer Tax

Transfer tax must be paid on profit earned on the transfer of property at the rate of 10% of the profit made.

 

Vietnam - more data and information

Your Comments

posted by teo c t | 2008-04-29

Accountant, Singapore

I would like to know more about the taxes in Vietnam, the registration and payment datelines for the various taxes in Vietname.Appreciate your input.Regards.Teo CT

posted by arthur | 2008-05-17

Accountant, Singapore

Could you advise if foreigners who never step into Vietnam can buy a condonimium or villa in Vietnam? Is he subject to 25% Capital gain tax as well as remittance withholding tax, if any? If there is a remittance, what is the withholding tax rate?Is there estate duty in Vietnam?Regards.Arthur

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