According to the documents appraising the draft Decree on tax management for business households and individuals (collectively referred to as business households) that have just been announced, business households leasing real estate, except for accommodation business activities, paying personal income tax is determined by the revenue exceeding 500 million VND (x) with a tax rate of 5%.
With value-added tax, business households with production and business activities with annual revenue of over VND 500 million are taxable; apply the method of calculating direct tax based on revenue by the percentage (x) of revenue.
Taxable revenue from property lease activities is the amount of money that the lessee pays each period according to the lease contract. In case the lessee pays in advance for many years, the revenue to calculate taxable income shall be allocated to the number of years of payment in advance or determined according to one-time payment revenue.
Thus, with the same method of calculating tax on revenue, for personal income tax, taxable revenue is deducted to the threshold of VND 500 million; for value added tax, taxable revenue is not deducted from this threshold.
It is expected that the Decree will take effect from January 1, 2026.
