Land Rent Reduction for 2024
On 11 April 2025, the Government issued Decree No. 87/2025/ND-CP on the reduction of land rent payable for 2024 (“Decree 87”).
Following Decree 87, a reduction of 30% of the land rental amount payable for 2024 will be granted to domestic companies, individuals, and foreign direct investment (FDI) enterprises as long as they are paying annual land rental to the State (“land user(s)”).
If a Land User benefits from a separate land rental reduction or site clearance compensation advance costs set-off against payable land rental, the 30% reduction will apply to the amount remaining after this reduction or set-off.
Decree 87 also specifies that the 30% reduction will not apply to outstanding land rental accrued from previous years or any late payment interest.
To apply for the reduction, Land Users must submit a written request following the standard form in the appendix of Decree 87 and submit it to the tax authority by 31 July 2025. Other than this request, Land Users are not required to submit any other documents, such as land lease decisions, land lease contracts, or land use rights certificates.
Upon receipt and following a review of the request, the competent authority will determine the amount eligible for reduction and issue a land rental reduction decision in accordance with applicable land rent and tax administration laws.
It is important to note that any requests submitted after 31 July 2025 will not be accepted. In this case, the Land User will have to pay 100% of the land rental for 2024.
If a Land User is later found to be ineligible for the reduction following an inspection by the competent authorities, they must return the reduced amount plus late payment interest to the State budget as prescribed by tax administration laws.
If a Land User has already paid the 2024 land rent before receiving the reduction, the overpaid amount shall be deducted from future rent or offset/refunded, depending on the circumstances, as per tax administration laws.
Decree 87 took effect immediately upon signing.
For more detailed analysis of Decree 87 and its impact on your business, please contact us at: contact@apflpartners.com
Disclaimer: This article and its content are for information only and are not given as legal or professional advice. they do not necessarily reflect all relevant legal provisions with respect to the subject matter. Readers should seek legal or professional advice before taking or refraining to take any action.
