The Law on Housing 2014 stipulates that foreigners can not to buy real estate in Vietnam, but they can still own lands but must follow legal procedures. What is some notes on inheritance with foreign elements? Let’s find out this question with LSX Law firm.
Law on Housing 2014
Civil Law 2015
Inheritance with foreign elements
In the context of strong international integration today; many social relations go beyond the scope of the country; one of which is inheritance relations with foreign elements. Inheritance cases involving foreign elements include:
- Firstly, the person who left the property is a foreigner or a Vietnamese residing abroad;
- Secondly, the property heirs are foreigners or Vietnamese residing abroad;
- Lastly, inherited property abroad.
Some notes on inheritance with foreign elements
Regarding regulations on recognition of land use rights and house ownership rights for inheritances involving foreign elements. Accordingly the new provisions of the 2014 Housing Law, from July 1, 2015, overseas Vietnamese and foreigners can not only inherit the value of the estate, but also have their names written on it. certification. This is an open regulation, creating favorable conditions for Vietnamese heirs residing abroad and foreigners to be able to legalize the right to use and own land in their own name – House. Specifically, the Housing Law 2014 stipulates:
- Firstly, for overseas Vietnamese, it is through the form of buying, renting and buying commercial houses of real estate enterprises and cooperatives (hereinafter referred to as real estate enterprises), buy, receive, donate, exchange or inherit houses of households and individuals ; receive the transfer of the residential land use right in the commercial housing construction investment project; which is allowed to sell the ground to organize the construction of houses by themselves in accordance with the law (clause 2, article 8);
- Secondly, foreign organizations and individuals may own houses in the cases of buying, renting, receiving, gifting or inheriting commercial houses, including apartments and separate houses in construction investment projects. housing , except for areas ensuring national defense and security as prescribed by the Government (point b, clause 2, article 160)
Regarding income tax payable in case of transfer of inherited land
Accordingly the provisions of Clause 4, Article 4 of the Law on Personal Income Tax; income from inheritance as immovable property between natural parents and biological children is not subject to tax. Accordingly the provisions of Clause 5, Article 3 of the Law on Income Tax Personal income; income from the transfer of real estate is taxable income.
However, for income derived from the transfer of inherited property, the transferor will not be subject to personal income tax in the following cases:
- Firstly, income from real estate transfer between husband and wife, biological father, natural mother with natural child, adoptive father, adoptive mother with adopted child, father-in-law, mother-in-law with daughter-in-law, father-in-law, mother-in-law with son-in-law, grandfather, grandmother with grandson, grandparents, grandmothers with grandchildren, brothers, sisters, siblings together;
- Secondly, incomes from the transfer of houses, residential land use rights, and properties attached to residential land of individuals in cases where the individual has only one house or only residential land.
Therefore, the heirs who want to transfer their inheritance, which are houses, land use rights and assets attached to land, will only be exempt from personal income tax when this land is the only property owned by them. property in Vietnam or only transfer that land to close family members (including: paternal grandparents (grandparents); adoptive parents, parents-in-law (wife); siblings).
Regarding the transfer of the money obtained from the transfer of inherited land abroad
In case the heir is a Vietnamese residing overseas or a foreigner who is not eligible to buy a house attached to residential land in Vietnam, upon receiving the value of the inheritance, he/she has the right to transfer that amount. abroad in accordance with the Ordinance on Foreign Exchange.
Specifically, Vietnamese citizens representing their heirs abroad may contact a bank authorized to conduct foreign exchange operations to carry out procedures for transferring and bringing foreign currency (obtained by inheritance) abroad.
– Written refusal to receive inheritance (accordingly the form above).
– Identity document (ID card or passport).
– Certificate of ownership of the property of the person refusing the inheritance.
– Other relevant papers: Birth certificate; Death certificate…
For inheritance under a will with foreign elements; The Civil Code stipulates as follows:
Firstly, the capacity to make a will; change; and cancelation if a will must comply with the law of the country of which the testator is a citizen
Secondly, the form of the will must comply with the laws of the country; where the will is created
If Vietnamese citizens make wills abroad; they must comply with foreign laws on the form of wills; if a foreign citizen makes a will in Vietnam; he/she must comply with the provisions of Vietnamese law on the form of a will.