There is no annual property tax on residential real estate in Vietnam. The main expenses arise when buying, selling, or renting out housing. When purchasing on the primary market, a 10% VAT is applied (usually included in the price) along with a 0.5% registration fee. A 2% income tax is levied upon sale, and a fee of up to 10% applies to rental income (while incomes up to 1 billion VND per year (~$38,000) are fully tax-exempt).
Taxes When Buying Real Estate
When purchasing residential real estate, foreign and local investors pay two main fees:
- Value Added Tax (VAT): 10%. Applies to new residential properties purchased directly from developers. This amount is usually already included in the final price, which is fixed in the Sales and Purchase Agreement (SPA).
- Registration Fee: 0.5%. Calculated based on the property value and payable at the final stage — upon issuance of the state Certificate of Land Use Rights and Ownership of House and Other Land-Attached Assets (Pink Book/Sổ Hồng).
Ownership and Sales Tax
Unlike many Southeast Asian countries, Vietnam completely lacks an annual property ownership tax for individuals. This rule significantly reduces asset maintenance costs and allows investors to maximize net returns on long-term holdings.
When exiting an asset and selling real estate, a fixed property transfer tax of 2% (Personal Income Tax - PIT) is applied. This fee is calculated from the gross transaction value specified in the contract, rather than from net profit or capital gains. The 2% rate is mandatory for all sellers, regardless of their citizenship, tax residency, or how long they have owned the apartment.
Summary Table of Tax Rates
| Operation | Tax Type | Rate | Calculation Base |
|---|---|---|---|
| Purchase | VAT | 10% | Developer's property price |
| Purchase | Registration Fee | 0.5% | Value upon Pink Book issuance |
| Ownership | Annual Tax | 0% | None |
| Sale | Property Transfer Tax | 2% | Gross transaction amount per contract |
| Rental | VAT + Personal Income Tax | up to 10% | Annual income (up to 1 billion VND (~$38,000) - tax-free) |
Rental Income Taxes (New 2026 Rules)
In 2026, Vietnam updated its taxation rules for real estate rental income. A law was passed in April raising the tax-free threshold to 1 billion VND (~$38,000) per year. This regulation is retroactive and applies to all income generated starting from January 1, 2026.
Important: The 1 billion VND limit is calculated per individual landlord, not per individual property. If you rent out multiple apartments, your annual income from them is aggregated.
The total base rate remains the same at 10% (5% VAT and 5% Personal Income Tax), but taxes are now calculated using a combined algorithm. The following scheme applies to individuals:
Rental Tax Calculation Mechanics (Base Rate 10%)
| Tax Type | If income ≤ 1 billion VND per year | If income > 1 billion VND per year |
|---|---|---|
| VAT (Thuế GTGT — 5%) | 0% | 5% applies to the entire income amount |
| Personal Income Tax (Thuế TNCN — 5%) | 0% | 5% applies only to the excess amount |
Understanding this mechanics allows you to accurately forecast financial burdens when leasing out a property. Let's look at how these rules apply with real figures.
Practical Calculation Examples
| Indicator | Case A: Income up to 1 billion VND | Case B: Income over 1 billion VND |
|---|---|---|
| Initial Data | 75 million VND per month (900 million/year) | 100 million VND per month (1.2 billion/year) |
| VAT Calculation (5%) | 0 VND | 1,200,000,000 × 5% = 60,000,000 VND |
| Personal Income Tax Calculation (5%) | 0 VND | (1,200,000,000 - 1,000,000,000) × 5% = 10,000,000 VND |
| Total Annual Tax | 0 VND | 70,000,000 VND |
| Note | Filing a zero-tax return (Mẫu số 01/BĐS) is mandatory | - |
Summary for Investors
Vietnam's real estate tax system is known for its transparency. All rates are fixed with no hidden fees. Complete exemption from annual property taxes makes the market attractive for investment. Furthermore, raising the tax-free limit to 1 billion VND allows the majority of apartment owners to rent out their real estate completely legally and without paying rental income taxes.
The VINPROP team provides full legal support at all stages of the transaction.
How We Can Help:
Investment consulting and market analysis: we select primary and secondary market projects, match them with relevant investment strategies, calculate potential yields, taxes, and expenses, and help build an ownership and subsequent exit strategy.
Comprehensive legal audit (Legal Due Diligence) and support: we conduct independent checks on property title clarity, developer permits, and remaining foreign quota limits. We coordinate legal transaction support: document preparation, notarization, and interaction with government authorities.
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FAQ
Is there an annual property tax in Vietnam?
No. Vietnam has no annual property or real estate tax for individuals.
What tax does a property buyer pay in Vietnam?
When buying a new property from a developer, a 10% VAT applies, which is usually already included in the price. A 0.5% registration fee is also paid upon property registration.
What tax is paid when selling an apartment in Vietnam?
When selling an apartment in Vietnam, individuals pay a Personal Income Tax at a rate of 2% of the total transaction amount (the selling price stated in the contract). This fee is mandatory even if the property is sold without making a profit or at a loss.
Do I have to pay rental income tax in Vietnam?
If annual rental income does not exceed 1 billion VND (~$38,000), VAT and Personal Income Tax are not charged. If the threshold is exceeded, VAT is 5% of the total income, and Personal Income Tax is 5% on the excess amount. This rule applies to income starting from January 1, 2026.
❗️Important: The 1 billion VND limit is calculated per individual landlord, not per property. Incomes from multiple apartments are aggregated.
Do I need to declare rental income if it is less than 1 billion VND?
Yes. The absence of tax does not exempt you from the obligation to declare rental income in the prescribed manner.
Is there a difference in real estate taxes for foreigners and locals in Vietnam?
No, Vietnam applies uniform taxation rules for all individuals. Foreign nationals and local residents pay the exact same taxes and fees when buying, selling, and renting out real estate. There is no distinction between residents and non-residents regarding higher rates or special holding periods: rates are fixed for everyone regardless of citizenship.