Land Use Fee Exemption When Converting Garden/Pond Land to Residential Land under Resolution 254/2025/QH15
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Based on:254/2025/QH15 - Ministry of Finance
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A citizen asked the Ministry of Finance whether his mother's land plot - which since a 2020 inheritance split contains only perennial-crop land (CLN) and other annual-crop land (BHK), with no residential land - qualifies for the land-use-fee exemption/reduction under point c, clause 2, Article 10 of National Assembly Resolution No. 254/2025/QH15, given the family's plan to convert part of it to residential land to build a house. The tax authority replied that under point c, clause 2, Article 10 of Resolution 254/2025/QH15, the policy applies only where garden or pond land sits within the same plot as existing residential land, or where land originally was garden/pond land attached to residential land but was split off through a land-use-right transfer, or was surveyed and split into a separate plot by the cadastral agency before July 1, 2014. In those cases, the land use fee for converting to residential use is reduced as follows: a 30% cut on the gap between the fee calculated at residential land price and at agricultural land price, within the locality's residential land allocation limit; a 50% cut for area exceeding that limit but not more than one time the limit; and no reduction (100% of the gap payable) for area exceeding more than one time the limit. This preferential calculation applies only once, to one plot, per household or individual. Decree No. 50/2026/ND-CP (dated January 31, 2026) provides implementing detail: the preferential calculation under this rule may be applied only once per household/individual, on one plot of their choosing, even if they hold multiple eligible plots (including plots across different provinces). The counting of conversion instances and the applicable land allocation limit are determined from August 1, 2024. Because the mother's plot in this case currently consists only of CLN and BHK land with no residential land, whether it qualifies under point c, clause 2, Article 10 depends on the land's origin, the timing of the plot split, and the cadastral records - specifically, whether that plot was previously garden/pond land attached to residential land. The tax authority advised the citizen to contact the local one-stop administrative service unit or the competent land management authority directly for specific guidance on the required dossier, procedures, and an accurate determination of the financial obligation based on the actual land records.
Question
In 2020 the questioner's family land plot was split into two ownership certificates through inheritance; the mother's portion consists only of perennial-crop land (CLN) and other annual-crop land (BHK), with no residential land. The family now wants to convert part of that area to residential land to build a house. The question: does the mother's case qualify for land use fee exemption/reduction under point c, clause 2, Article 10 of Resolution No. 254/2025/QH15?
Tax Authority's Answer
Legal Basis - Resolution 254/2025/QH15
Pursuant to point c, clause 2, Article 10 of National Assembly Resolution No. 254/2025/QH15, regarding exemption/reduction of land use fees and land rental fees, and payment of land use fees and land rental fees upon land-use-purpose conversion, specifically:
«Article 10. Exemption, reduction of land use fees, land rental fees; payment of land use fees, land rental fees upon conversion of land use purpose:
- Upon conversion of land use purpose specified at points b, c, d, dd, e and g of clause 1, Article 121 of the Land Law, the land user must pay land use fees or land rental fees as follows:
c) Where garden land, pond land, or agricultural land within the same plot as residential land - as determined upon recognition of land use rights - is converted to residential land; or land whose origin is garden/pond land attached to residential land but which the land user split off to transfer land use rights, or which the cadastral survey unit itself surveyed and split into a separate plot before July 1, 2014, is converted to residential land, the land use fee is calculated at: 30% of the difference between the land use fee calculated at residential land price and at agricultural land price at the time of the decision permitting the purpose conversion (hereinafter the 'difference'), for the area converted within the locality's residential land allocation limit; 50% of the difference for area exceeding the limit but not more than one time that limit; 100% of the difference for area exceeding more than one time that limit. This fee level applies only to one household or individual (calculated on one plot).»
Exemption/reduction of land use fees upon land-use-purpose conversion applies to specific subjects and conditions set out in Article 6 [continued below].
Implementing Detail - Decree 50/2026/ND-CP
Government Decree No. 50/2026/ND-CP dated January 31, 2026, detailing certain articles of National Assembly Resolution No. 254/2025/QH15 dated December 11, 2025 on mechanisms and policies to resolve difficulties and obstacles in implementing the Land Law regarding land use fees and land rental fees, states:
«Article 6. Calculating land use fees for households and individuals converting garden, pond, or agricultural land to residential land under point c, clause 2, Article 10 of Resolution No. 254/2025/QH15:
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The fee calculation under this Article applies once per household or individual, calculated on one plot of the household's or individual's choosing; a subsequent conversion on that same plot, or conversion of a different plot, is charged at 100% of the difference between the land use fee at residential land price and at agricultural land price at the time of the competent authority's decision permitting the conversion.
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Where a household or individual holds multiple plots (including plots across multiple provinces or centrally run cities) eligible for purpose conversion under this Decree, that household or individual may choose one (1) plot to apply the fee calculation under this Decree. The household or individual must commit to this in the application for land-use-purpose conversion and bear responsibility for that commitment...
Where a competent authority or person discovers that a household or individual has already had the fee calculated under point c, clause 2, Article 10 of Resolution No. 254/2025/QH15 but still requests to choose a plot to continue receiving this policy, the information is forwarded to the tax authority, which recalculates the land use fee at 100% of the difference between the fee at residential land price and at agricultural land price at the time of the conversion decision; any amount already paid is credited against the recalculated fee; and the household or individual must also pay an amount equivalent to the late-payment charge on the land use fee, calculated from the time of the conversion decision to the time the competent authority issues a written referral of the violation to the tax authority under tax administration law.
- The counting of the number of purpose conversions, the determination of the residential land allocation limit, and the selection of the plot for conversion under this Article are calculated from August 1, 2024.
...6. The land use fee payable for purpose conversion under this Article is determined in accordance with Article 20 of Decree No. 103/2024/ND-CP...»
Application to the Specific Case
Applying this to the questioner's case: the mother's plot currently consists only of CLN and BHK land with no residential land; therefore, whether it falls under point c, clause 2, Article 10 of Resolution No. 254/2025/QH15 depends on the plot's origin, the timing of the plot split, the cadastral records, and whether that plot was previously garden/pond land attached to residential land.
The questioner is advised to contact the local one-stop administrative service unit or the competent authority under land law where the land is located, for specific guidance on the required dossier and procedures, and to provide the relevant legal documents so the financial obligation can be accurately determined based on the actual records.
Tax Sub-Department No. 1 provides this answer for the questioner's information.
Editorial note: a few lines at the image edges are low-resolution; all figures, dates, and document references in this transcription were read and cross-checked carefully, and none were found illegible.