Vietnam ranks as the 14th-most-populated country in the world with a population of ~93 million as of 2017. It is also the 8th-most-populated country in the Asian region.
The fast-growing country is strategically located – bordered by China to the north, Laos to the northwest, Cambodia to the southwest and Malaysia across the South China Sea to the southeast.
Since the reunification of North and South Vietnam in 1975, Hanoi has established and remains as Vietnam’s Capital City till this day.
New Vietnam Foreign Property Ownership Guide
Since the newly reformed Vietnamese Law on Residential Housing (LRH) Officially kicked-off in 1st July 2015, several major past restrictions on property ownership have been removed for foreigners.
Here are the LATEST UPDATES on Vietnam Property Foreign Ownership Law Investors Need to Know:
Individuals: Foreign individuals are eligible to buy residential properties in Vietnam, as long as they can enter the country legally.
Entities: All legal entities like foreign investment funds, banks, Vietnamese branches and representative offices of overseas companies that are established in Vietnam; are eligible to buy Vietnam properties.
Types: The new Residential Housing Law allows eligible foreign entity and individuals to buy and own all residential sectors including apartments and landed properties such as villas and townhouses (previously only applicable to apartments).
Foreigner Quota Restrictions:
(i) Foreigners can own not exceeding 30% of the total units within one condominium complex;
(ii) and not exceeding 10% for the total number of the separate houses for each project.
Purpose of Purchase: The properties owned by foreigners can be sold, sub-leased, inherited and collateralize (previously only for owner occupying purpose).
(i) Foreign Individuals: up to 50 years leasehold from the date of issuance of ownership certificate + possible renewal (subjected to approval by authorities.)
(ii) Foreign Individuals + Vietnamese spouse: Freehold
(iii) Foreign organizations: up to the duration (inclusive of extended duration) indicated in the investment certificate.
What are the Taxes Involved in the New Vietnam Foreign Property Ownership?
The following taxes are applicable to property sales transactions:
Value Added Tax (VAT): 10% VAT is taxed on any sale of property by local or foreigners.
Registration Tax for Ownership: 0.5% registration tax for obtaining the house ownership certificate on the apartment value.
Personal Income Tax (For Resale): If personal income is earned through the assignment or resale of apartments or houses, a 2% personal income tax has to be paid on the transacted value.
Personal Income Tax (for Rental Income): If personal income is earned through rental of house/apartment, 5% VAT and 5% PIT has to be paid on revenue.
For rental income exceeding VND 1,500,000 per month, a business license tax of VND 1,000,000 (approx US$45) per year applies.
Administration Fee: A minimal administration fee is to be granted an ownership certificate at the current regulation.
GBS – Business & Legal services company in Vietnam
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