Question:
I have a land parcel comprising residential land and an attached portion recorded as garden pond land or agricultural land within the same parcel. I intend to apply for conversion of that portion to residential land to regularize the land use purpose and proceed with related procedures. I would like to know the percentage applied to the land price difference, how the within quota and over quota portions are determined, and if I already obtained a decision permitting conversion before 01 January 2026, how the tax authority will recalculate, collect, or refund the payable amount.
Answer:
Concept: The land use levy payable upon a competent authority’s approval of conversion of land use purpose to residential land is determined based on the difference between the land use levy calculated using residential land prices and that calculated using agricultural land prices, as of the time the conversion decision is issued. Depending on whether the converted area falls within or exceeds the local residential land allocation quota, the payable rate may be 30 percent, 50 percent, or 100 percent of the relevant difference.
(Legal basis: Article 10 of Resolution No. 254/2025/QH15 on a number of mechanisms and policies to remove difficulties and obstacles in the implementation of the Land Law, hereinafter referred to as “Resolution No. 254/2025/QH15”.).
1. Timing and basis for determining the difference used to calculate the land use levy
- The difference used to calculate the land use levy is determined as of the time the competent authority issues the decision permitting the change of land use purpose.
- The land price basis for determining the financial obligation is linked to the provincial land price list and the land price adjustment coefficient in accordance with the Resolution.
(Legal basis: Clause 1 Article 5, clause 1 Article 7, clause 2 Article 8, point c clause 2 Article 10 Resolution No. 254/2025/QH15).
2. Rates of 30 percent, 50 percent, and 100 percent by within quota and over quota areas
- 30 percent of the difference applies to the area converted within the local residential land allocation quota.
- 50 percent of the difference applies to the area exceeding the quota but not exceeding one time the local residential land allocation quota.
- 100 percent of the difference applies to the area exceeding the quota and exceeding one time the local residential land allocation quota.
- The above rate structure is applied only once for a household or an individual and is calculated on a single land parcel.
(Legal basis: Point c clause 2 Article 10 Resolution No. 254/2025/QH15).
3. Transitional treatment where conversion was permitted before 01 January 2026
- Where, from 01 August 2024 to before 01 January 2026, a decision permitting conversion to residential land under the specified case was issued but the land use levy has not yet been paid under the tax authority’s notice, the tax authority recalculates the payable amount under the Resolution and adjusts the notice accordingly. Any late payment interest (if any) is calculated on the recalculated amount in accordance with the referenced rules.
- Where the land use levy has already been paid under the tax authority’s notice, the land user may request a recalculation. If the recalculated amount is lower than the amount paid, the excess is handled through offsetting or cash refund mechanisms as referenced.
(Legal basis: Points a and b clause 10 Article 4 Resolution No. 254/2025/QH15).
