The Ministry of Finance issued Official Letter 18491/BTC-CST on receiving and explaining the opinions of the Committee on the draft Law on Personal Income Tax (PIT) amendment.
In this document, the Ministry of Finance stated that for individuals with real estate leasing activities that are not regular business activities leased under contracts (except for accommodation business activities), to ensure simple tax payment, the draft Law stipulates that individuals with real estate leasing activities with annual revenue of over VND500 million/year will only apply the method of calculating the ratio on revenue. Accordingly, there will be no need to determine costs, no need to offset income (if there is more than 1 rental property), no need to settle annual taxes.
In recent days, localities have instructed real estate rental businesses to declare taxes.
On December 1, Hanoi Tax Department instructed individuals and households on a number of contents related to leasing activities in the real estate sector.
Accordingly, individuals and households leasing real estate are individuals and households with revenue from leasing, including: Renting houses, premises, stores, factories, warehouses, ... excluding accommodation services;
Accommodation services not included in property leasing activities include: Providing short-term accommodation facilities for tourists and other visitors; Providing long-term accommodation facilities other than apartments for students, workers and similar entities; Providing accommodation facilities with food and beverage services or entertainment facilities.
How to determine the taxable revenue threshold
Revenue from real estate leasing activities is the entire amount of money that households and individuals earn from real estate leasing.
In case the household or individual leasing real estate carries out other business activities, the taxable revenue includes revenue from real estate leasing activities and revenue from other production and business activities.
In case the revenue from production and business activities in the calendar year is below the taxable revenue threshold, it is not subject to tax payment according to the provisions of law.
What taxes must individuals leasing real estate pay?
Regarding revenue from real estate leasing activities, Hanoi Tax said that it is the entire amount of money that households and individuals earn from real estate leasing.
In case the household or individual leasing real estate carries out other business activities, the taxable revenue includes revenue from real estate leasing activities and revenue from other production and business activities.
In case the revenue from production and business activities in the calendar year is below the taxable revenue threshold, it is not subject to tax payment according to the provisions of law.
According to the tax authority, individuals leasing real estate with annual revenue below the taxable threshold must pay VAT and personal income tax.
According to current regulations, individuals leasing real estate must declare taxes directly to tax authorities or organizations declaring taxes on their behalf, paying taxes on behalf of individuals leasing real estate.
The tax declaration file is submitted to the tax authority directly managing the place where the real estate is for rent.
Currently, the Tax Department is implementing an Experience Portal for business households and individuals to get acquainted with before officially applying it from January 1, 2026 to help business households and individuals more conveniently declare and pay taxes later.
Business households and individuals access the eTax Mobile application, on the display screen, click "Experience for Business Households and Individuals". At this function, households and individuals can get acquainted and practice electronic declaration.
