According to the current legal regulations, tax must be paid on activities such as transfer of land use rights, transfer of land lease rights, sublease of land or transfer of assets attached to the land if any income is generated…  A tax rate varying between 10-22% will be applied in such situations based on individual circumstances.

According to Circular No. 78/2014/TT-BTC, enterprises subject to income tax from real estate transfer include not only enterprises of all economic sectors, all industries that generate income from real estate transfer activities, but also real estate enterprises with income from land sublease activities.

Income from real estate transfer activities 

  • Income from the transfer of land use rights, the transfer of land lease rights. This part of income includes the transfer of projects associated with the transfer of land use rights and land lease rights;
  • Income from land sublease activities of real estate enterprises. Enterprises should note that this income does not distinguish whether there is infrastructure or architecture attached to the land;
  • Income from the transfer of houses or construction works attached to the land, including assets attached to such houses and construction works, if the value of the property is not separated when transferring regardless of whether there is a transfer of land use rights or the transfer of land lease rights;
  • Income from the transfer of assets attached to the land;
  • Income from the transfer of ownership or right to use the housing;
  • Income from land sublease of real estate enterprises. However, it does not include the case of only renting houses, infrastructure, and architectural works on land. The corporate income tax rate for real estate transfer activities is 22% (a 20% tax rate is applied from January 1st, 2016).

Enterprises should note that income from the transfer of real estate must be determined separately to declare and pay taxes. Enterprises that do not have real estate business functions must declare each occurrence for real estate transfer activities. However, enterprises with real estate business functions can also declare according to each arising time if there is a need.

Enterprises with real estate business functions shall pay temporary corporate income tax quarterly according to the regulations. At the end of the tax year, enterprises carry out corporate income tax finalization procedures for all real estate transfer activities that have temporarily paid corporate income tax quarterly or according to each occurrence.

Tax incentives

Pursuant to Clause 3, Article 19 of the Circular No. 78/2014/TT-BTC, enterprises are only entitled to corporate income tax incentives, specifically a lower tax rate of 10% when enterprises implement social housing investment and business projects to sell, rent or lease to buy for objects as prescribed in Article 53 of the Law on Housing.


According to Circular No. 96/2015/TT-BTC, if an enterprise has real estate transfer activities but suffers a loss, this loss will be offset by the profit of production and business activities (including other income specified in Article 7 of Circular 78/2014/TT-BTC). After clearing, if there is still a loss, it will continue to be carried forward to the next years within the time limit for carrying forward the loss in accordance with current laws.

Thus, enterprises with income arising from the transfer of real estate must declare and pay the tax. Businesses with and without the function of real estate business will declare and pay taxes according to regulations.

The article is based on laws applicable at the time noted as above and may no longer be appropriate at the time the reader approaches this article as the applicable laws and the specific cases that the reader may wish to apply may have changed. Therefore, the article is for referencing only.


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