When is compensation for land investment costs?
According to Clause 1, Article 107 of the 2024 Land Law, when the State reclaims land, the following cases will not be compensated for land but will be compensated for investment costs on the remaining land:
- Land allocated by the State does not collect land use fees, except for agricultural land of households and individuals that are compensated for land;
- Land allocated by the State to organizations in cases where land use fees are collected but land use fees are exempted;
- Land leased by the State with annual land rent; leased land with one-time land rent for the entire lease term but exempted from land rent (except for households and individuals using non-agricultural land that is not residential land and are eligible for compensation, they will be compensated for the land)
- Land belonging to the agricultural land fund used for public purposes is leased by the People's Committee at the commune level;
- Land contracted for agricultural and forestry production, aquaculture, salt production.
- Agricultural land with allocated area exceeding the limit.
Note, only applicable when the State reclaims land for national defense and security purposes; socio-economic development for national and public interests.
Types of investment costs that are compensated
According to Clause 7, Article 3 of the 2024 Land Law, the remaining land investment costs are reasonable costs that land users have directly invested in land in accordance with the land use purpose, but by the time the State reclaims the land, the user has not fully recovered.
In Clause 2, Article 107 of the 2024 Land Law, the remaining land investment costs include all or part of the following expenses:
- Site clearance costs;
- Cost of improvement to increase soil fertility, wash away salt, prevent erosion and damage to land used for agricultural production purposes;
- Cost of reinforcing the ability to withstand vibration and subsidence of land used as production and business premises;
- Compensation/support/resettlement costs that have been advanced according to the plan approved by the competent state agency but have not been fully deducted from the land use fee and land rent payable;
- Other related costs invested in land suitable for land use purposes.
