Worrying whether land mortgaged at banks being auctioned needs to pay VAT

Xuyên Đông |

On the Government Portal on July 2, the Ministry of Finance answered people about the regulation on VAT payment when selling auctioned assets that are land plots mortgaged at banks.

Ms. T.T. P. T in Son La reflected that she had a bank loan from 2023. The collateral is land use rights.

There are no construction works on the land. By the beginning of 2026, due to business difficulties leading to insolvency, Ms. T and the bank agreed on a plan to handle bad debts.

Ms. T signed the minutes of handover of secured assets, handover of the site to the bank for management; signed the minutes of agreement on handling secured assets (agreement on selling price, selection of auction organization, valuation...), but has not carried out land use right transfer.

After that, the bank sold the asset through auction and the auction was completed.

However, when carrying out procedures for transferring rights to the auction winner, the tax authority requires the asset buyer to declare and pay value-added tax at a tax rate of 10%.

Ms. T believes that this tax has been deducted by the auction organization from the money from the sale of assets and declared on behalf of the buyer. This leads to the fact that her debt obligations have not been thoroughly handled and additional value-added tax obligations arise.

Ms. T investigated and was cited by the tax authority as Official Dispatch No. 13401/BTC-CST of the Ministry of Finance. Ms. T believes that such application is not really appropriate, because the assets are still owned by her at the time of handling.

Therefore, assets may fall under the case of not being subject to value-added tax as prescribed in Clause 3, Article 4 of Decree No. 181/2025/ND-CP.

She requested competent authorities to consider and specifically answer the above-mentioned problems.

Regarding this issue, the Ministry of Finance has the following opinions:

Official Dispatch 13401/BTC-CST of the Ministry of Finance responding to the Vietnam Bank for Agriculture and Rural Development regarding the proposal to amend the Law on Value Added Tax No. 48/2024/QH15.

Clause 1, Article 4 of the Value Added Tax Law No. 48/2024/QH15 stipulates that taxpayers include:

Organizations, households, and individuals producing and trading goods and services subject to value-added tax (hereinafter referred to as business establishments)".

Clause 24, Article 5 of the Law on Value Added Tax No. 48/2024/QH15 (amended and supplemented in Article 2 of Law No. 09/2026/QH16) stipulates that subjects not subject to tax include:

Goods and services of households and individuals producing and doing business with annual revenue from the Government's regulations or below; assets of non-business organizations and individuals who are not value-added taxpayers sold; national reserve goods sold by the national reserve agency; fees and charges according to the provisions of law on fees and charges. Based on macroeconomic indicators and budget balancing capacity; the Government shall stipulate the annual revenue level in this clause in accordance with the socio-economic context in each period.

Clause 1, Article 1 of Decree No. 141/2026/ND-CP dated May 29, 2026 of the Government stipulates:

Amending the phrase "500 million VND" to "01 billion VND" in Article 3, Article 4, Clause 1, Article 8, Article 9, Article 10, Clause 3, Article 11, Clause 1 and Clause 2, Article 12, Clause 4, Article 17, Clause 3, Article 18 of Decree No. 68/2026/ND-CP".

Clause 3, Article 9 of the Value Added Tax Law No. 48/2024/QH15 stipulates the tax rate:

The 10% tax rate applies to goods and services not specified in Clauses 1 and 2 of this Article, including services provided by foreign suppliers without permanent establishments in Vietnam to organizations and individuals in Vietnam through e-commerce channels and digital platforms".

Xuyên Đông
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