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3 useful FAQs for foreign buyers in Vietnam

Viet Nam is one of Southeast Asia’s premier emerging markets. From 2014 to 2016, Viet Nam’s economy recovered, with strong GDP growth of 5.4%, 6.0% and 6.7% mostly due to the implementation of effective monetary policy. The positive signals of the economy and new updated land laws have led to a significant growth in demand from foreign buyers aiming to own properties in Vietnam. 

1. What are the regulations on foreign property ownership in Viet Nam?

    • Current Law: effective 1 July 2015 
    • Who: Foreigners permitted entry to Viet Nam. 
    • Property: Residential properties: apartments and landed houses 
        • 30% total units of any apartment development 
        • 10% of landed villa and/or housing project stock 
        • 250 landed properties in one administrative ward 
    • Duration: 50 year leasehold with extension, subject to authority approval 
    • Purpose: Living, sale, lease, inheritance, gift or donation.
  • 2. A local bank account

    To ensure more seamless transfer for local property purchases, foreign investors are advised to set up a local bank account. There are many international banks in Viet Nam such as: Shinhan Bank, Citi Bank, HSBC and Standard Chartered.
  • 3. What taxes are involved?

    A foreigner is responsible to directly declare and pay tax at the district tax bureau where the property is located. A third party may be legally authorized to act on their behalf. 
    • Value added tax (VAT): 10% VAT is applied on any property sale whether local or foreigner. 
    • Administration fees: A minor fee is payable for property ownership certificate issuance. 
    • Ownership registration tax: 0.5% registration tax against property value to obtain the ownership ‘pink book’ certificate. 
    Maintenance fee / sinking fund: 
    • Maintenance fees are referred to as a ‘sinking fund’ and are contributed to by development unit buyers. 
    • Fees are for major building and common area servicing to maintain development quality standards. 
    • Current sinking fund fees are 2% of the house/apartment price, before VAT. 
    Personal income tax: Personal income earned through assignment or apartment/houses resale requires 2% personal income tax paid on the transacted value. 

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