Quick answer: Foreigners transferring real estate in Vietnam pay personal income tax equal to the transfer price multiplied by the 2% rate — a simple formula applied uniformly to residents and non-residents alike, regardless of holding period (Article 24, Law on Personal Income Tax 109/2025/QH15). Taxable income is determined at the time the transfer contract takes effect or the time of registration of land use rights or property ownership (Clause 2, Article 14). The tax must be declared and paid before the title transfer paperwork — no tax payment, no new ownership registration.
Applicable legal bases
The framework below is in force as of 20 October 2026 and directly governs this article:
- Law on Personal Income Tax 109/2025/QH15 (effective 01/07/2026; replaces Law 04/2007/QH12) — Article 24 (PIT on real estate transfers: transfer price multiplied by the 2% rate); Clause 2, Article 14 (timing: when the transfer contract takes effect or when land use rights or property ownership are registered).
- Decree 253/2026/ND-CP (effective 01/07/2026) — guidance on determining the transfer price (contract price; where unstated or below the land price table, the table price with adjustment coefficients at transfer applies).
- Law on Tax Administration 108/2025/QH15 (effective 01/07/2026, replacing Law 38/2019/QH14) — declaration and payment obligations before ownership registration.
In-depth analysis
The first clarification, to avoid a major confusion: there was once a draft proposing a holding-period scale (10% under 2 years, 6% for 2–5 years, 4% for 5–10 years, 2% for 10 years or more) — but that was only a legislative option and was not adopted into the enacted law. The promulgated Law on Personal Income Tax 109/2025/QH15 keeps the 2%-of-transfer-price formula, applicable from 01/07/2026. Every computation and advisory for transactions from now on must use 2% — citing the draft’s 10/6/4/2% scale as current law is wrong.
The 2%-of-price formula — instead of 20% on the spread (sale minus purchase price) — is a deliberate legislative choice: simple, easy to collect, and independent of whether the transferor can prove the original purchase price. For foreigners this advantage is even clearer: they often bought years ago through multiple currency conversions, making an exact “purchase price” nearly impossible to establish. A 2% tax on the sale price eliminates all cost-basis disputes.
The transfer price follows the price stated in the contract at transfer. Where the contract states no price, or the stated price is below the land price table with adjustment coefficients issued by the competent authority at transfer, the taxable price follows the table. For houses and construction works attached to land: if the stated value is below the registration-fee value set by the provincial People’s Committee, the registration-fee value applies. In practice, “declaring low to save tax” is common but high-risk — the tax authority cross-checks against the land price table and actual transaction data; abnormal gaps trigger deemed assessments and penalties.
The tax procedure around title transfer
For a foreigner transferring Vietnamese real estate, the practical sequence has four steps. Step 1: sign the (notarized) transfer contract — this fixes when the tax obligation arises. Step 2: declare PIT — the transferor (or an authorized organization or individual) files with the tax authority. Step 3: pay 2% of the transfer price to the state budget and obtain the payment receipt. Step 4: file for registration of the change in land use rights and housing ownership at the land registration office — the dossier must include the tax payment receipt; without tax payment there is no title transfer. For a Vietnamese buyer, verify the seller’s tax obligations are complete before releasing the final payment — if the seller “vanishes” on the tax, the transfer stalls.
One foreigner-specific point: non-resident individuals transferring Vietnamese real estate use the same 2% formula — there is no separate non-resident rate for this income type (unlike employment income with its 20% non-resident rate). This simplicity and uniformity makes foreigners’ real estate deals far more predictable on tax cost than other income types.
Common risks and how to prevent them
- Citing the draft 10/6/4/2% scale: it is not current law — the enacted law keeps 2% on the transfer price.
- Declaring a contract price below the real price: the authority cross-checks the land price table and reassesses — gaps bring penalties.
- Filing for title transfer before paying tax: the dossier is returned — complete the tax obligation first (step 3 before step 4).
- Buyer releasing full payment before the seller pays tax: the deal stalls if the seller drags their feet — retain part of the price until the tax receipt exists.
Frequently asked questions
1. A foreigner sells an apartment for VND 5 billion — how much PIT?
Tax = 5 billion × 2% = VND 100 million — regardless of original purchase price, holding period or the seller’s residency status.
2. The contract states 4 billion but the land table implies 4.5 billion — which price counts?
VND 4.5 billion — where the contract price is below the land price table with adjustment coefficients at transfer, the taxable price follows the table.
3. Does the rate differ between residents and non-residents?
No. Real estate transfers uniformly bear 2% on the transfer price in both cases — unlike employment income (non-residents face a flat 20%).
4. When is the tax paid — before or after title transfer?
Before. The registration dossier for the change in land use rights and housing ownership must include the tax payment receipt; without it there is no title transfer.
Key takeaway for investors
Vietnamese real estate transfers have the simplest tax formula of all income types: 2% of the transfer price, no residency distinction, no holding-period scale. What matters is getting the taxable price right (check the land price table; do not under-declare), paying before title transfer, and not confusing a draft rate scale with enacted law.
This article has been quality-reviewed by the FLAW AI Legal Council This content is legal reference only and does not replace counsel for a specific case.
