When converting the purpose of use from agricultural land to residential land (commonly known as "residential land", the land user is obliged to carry out financial payments with the State. Fees and charges payable include:
- Land use fees.
- Registration fee.
- Fees for appraisal of documents for granting land use right certificates.
- Fees for granting certificates of land use rights and ownership of assets attached to land.
In which, there are 2 types of land use fees in the land price list as the basis for calculating land use fees and registration fees. Land use fee is also the amount of money that accounts for the majority of the cost of land acquisition from agricultural land.
Pursuant to Clause 1, Article 8 of Decree 103/2024/ND-CP on calculating land use fees when changing land use purposes for households and individuals.
Land use fee when converting to residential land from agricultural land is determined according to the following formula:
Land use fee payable = Land use fee of the land type after changing purpose - Land use fee or land rent of the land type before changing land use purpose (if any)
In which:
Land use fee of the land type after conversion = Land area for calculating land use fee × Land price for calculating land use fee (according to the Land Price List)
Land use fee or land rent of the land type before conversion, if it is agricultural land, is divided into two cases:
+ For agricultural land allocated by the State without collecting land use fees or originating from legal transfers from other households and individuals:
Land fee before transfer = Land area × Agricultural land price in the Land Price List
+ For agricultural land leased by the State with one-time payment for the entire lease term:
Land fee before transfer = Land area with rental fee collection × Land price corresponding to lease term × (Restant land use term / Land lease term before transfer)
Thus, land use fee when converted to residential land is the difference between the value of residential land and the value of agricultural land at the time of conversion. The amount to be paid will be even greater if the price of agricultural land is much lower than the price of residential land. On the contrary, when agricultural land prices increase, the difference will decrease, causing land use fees to be paid to decrease accordingly.
Note: The phrase "land price" mentioned in this article is the land price in the land price list issued by the provincial People's Committee according to the provisions of law.
