Official letter 484/TCT-CS 2025 concerns the corporate income tax policy for land plot subdivision activities, selling to relatives for use as burial plots.

To: Mekong Joint Stock Company
(Representative office: No. 22 Ly Tu Trong, An Cu Ward, Ninh Kieu District, Can Tho City)

The General Department of Taxation has received document No. 35/CPMK.2024 from Mekong Joint Stock Company (the Company), requesting tax incentives for corporate income tax for land subdivision activities related to selling plots for tombs to be used by family members. Regarding this issue, the General Department of Taxation has the following opinion:

• According to Article 3, Clause 2 of the Corporate Income Tax Law No. 14/2008/QH12 dated June 3, 2008, which regulates taxable income;

• According to Article 7, Clause 3 of the Corporate Income Tax Law No. 14/2008/QH12 dated June 3, 2008, which stipulates:

“3. Income from the transfer of real estate must be declared separately for tax purposes.

The Government shall provide detailed regulations and instructions on the implementation of this provision.”

• According to Article 13 of Decree No. 124/2008/ND-CP dated December 11, 2008, the Government states: "Income from the transfer of real estate includes income from the transfer of land use rights, transfer of land lease rights; income from re-renting land by real estate businesses according to the land law, regardless of whether or not there are infrastructure works and architectural constructions attached to the land."

• According to Clause 2, Article 19 of Decree No. 124/2008/ND-CP dated December 11, 2008, income from the transfer of real estate is not subject to corporate income tax incentives;

• According to Clause 2, Article 1 of the Corporate Income Tax Law No. 32/2013/QH13 dated June 19, 2023, which regulates other incomes, including income from real estate transactions;

• According to Article 13 of Decree No. 218/2013/ND-CP dated December 26, 2013, the Government stipulates: "Income from the transfer of real estate includes income from transferring land use rights, transferring land lease rights, re-renting land by real estate businesses according to the land law, regardless of whether or not infrastructure works and architectural constructions are attached to the land; income from transferring houses or other constructions attached to the land, including any assets related to the house or construction, whether or not the land use rights or land lease rights are transferred."

• According to Clause 2, Article 19 of Decree No. 218/2013/ND-CP, there is no application of corporate income tax incentives for income from real estate transactions.

• According to Point d, Clause 4, Article 14 of Decree No. 23/2016/ND-CP dated April 5, 2016, the Government stipulates:
  “d) Registration and transfer of individual tomb plots:

• A person registered for an individual tomb plot as prescribed in Point a, Clause 5 of this Article cannot transfer the tomb plot;

• The transfer of land use rights attached to infrastructure for individual tombs in cemeteries built with non-state budget capital is carried out through a contract signed between the investor and the service user. The contract can be separate or combined with a cemetery service contract. If the service user has signed a contract but wishes to donate, gift, or transfer the contract to another user, they must establish a new contract between the investor and the transferee, complying with current legal provisions."

• According to Clause 9, Article 11 of the Law on Complaints No. 02/2011/QH13 dated November 11, 2011, it stipulates:
  "Article 11. Complaints not subject to resolution
  …

9. Complaints already accepted or resolved by the Court with a judgment or decision, except for decisions to terminate the resolution of administrative lawsuits."

Based on the provisions of tax law and regulations on the construction, management, and use of cemeteries, the activity of subdividing land into plots for sale to family members for burial purposes is considered a transfer of land use rights. Income from the transfer of land use rights must be accounted separately for corporate income tax filing, and income from this activity does not qualify for tax incentives according to the regulations.

Regarding the tax policy for the socialization activities related to the investment in the cemetery project by Mekong Joint Stock Company, the General Department of Taxation has already sent a document No. 5508/TCT-CS dated November 27, 2024, to the Company (with a photocopy of the document attached).

If the Company's complaint has been resolved by a court judgment, it is considered a complaint not subject to resolution. The Company is advised to comply with the appellate judgment No. 296/2017/HCPT dated October 13, 2017, by the People's Court of Ho Chi Minh City.

The General Department of Taxation responds for the Company’s awareness and compliance.