5 types of taxes/fees to pay when buying and selling real estate

The types of taxes and fees that must be paid when buying and selling real estate are clearly regulated. However, currently, in many cases, the seller “covers” all costs of transferring the red book, meaning the seller pays all taxes and fees. There are also cases where the two parties agree that each party will pay half. However, regardless of whether the seller or the buyer pays, the following fees must still be paid:

Notary Fees

According to the law, a notarized contract is considered the highest legal basis when transferring home ownership from the seller to the buyer.

The current notary fee is stipulated in Circular No. 257/2016/BTC as follows:

Personal income tax

All activities from business, buying and selling real estate transactions will be subject to personal income tax. According to the 2007 Personal Income Tax Law, the taxable party is the seller of real estate, while the buyer is not subject to this tax.

The tax rate of 2% is calculated on the value agreed upon by the parties recorded in the notarized sales contract. For example, if the real estate is sold for 2 billion VND, the personal income tax payable is: 2 billion VND x 2% = 40 million VND.

In case the purchase price is lower than the land price according to the Land Price List issued by the Provincial People’s Committee in accordance with the provisions of the law on land at the time of tax declaration, the tax authority will calculate the tax according to the house and land price issued by the State.

For example: A 50m2 plot of land is agreed to be 20 million VND/m2, the total transfer value is one billion VND. However, the land price list stipulates that the area is 30 million VND/m2. Thus, the payment level will be: 1 billion 500 million VND x 2% = 30 million VND.

Registration fee

According to Article 3 of Decree 140/2016/ND-CP, organizations and individuals with assets in the group subject to registration fees must pay this fee when registering ownership with the competent authority. This means that when transferring land, the buyer must register land changes within 30 days and the buyer must pay the registration fee.

Formula for calculating the registration fee: Registration fee = 0.5% x area x price of 1m2 according to the land price list.

In which, the area of ​​the house subject to registration fees is calculated based on the floor area of ​​the house including the ancillary works under the legal ownership of that individual. The price of 1m2 of land is the actual price of building 1m2 of floor of the house level and class as prescribed by the Provincial People’s Committee.

Fee for granting certificates of land use rights, house ownership rights, and assets attached to land

The fee for granting certificates of land use rights, house ownership rights, and assets attached to land is the amount of money that organizations, households, and individuals must pay when being granted certificates of land use rights, house ownership rights, and assets attached to land by competent state agencies.

The fee for granting certificates of land use rights, house ownership rights, and assets attached to land includes: Certificate of land use rights, house ownership rights, and assets attached to land; Certificate of registration of land changes; Extract of cadastral map; Documents, cadastral records data (Circular 85/2019/TT-BTC).

The specific collection level is determined by each locality according to the socio-economic situation in the area. Currently, the collection rate of Hanoi City is according to Resolution 20/2016/NQ-HDND; Ho Chi Minh City is according to Resolution 124/2016/NQ-HDND.

Fee for appraisal of dossiers for granting Land Use Right Certificates

In Circular 85/2019/TT-BTC, the fee for appraisal of dossiers for granting Land Use Right Certificates is the collection for the work of appraising dossiers, necessary and sufficient conditions to ensure the implementation of granting Land Use Right Certificates, house ownership rights and other assets attached to land. Based on the area scale of the land plot, the complexity of each type of dossier, the purpose of land use and the specific conditions of the locality to prescribe the fee rate for each case.

Source baophapluat.vn – Link