📄 Individual House Rental – Can Companies Deduct Rent Expense for Tax?
In business practice, many companies rent houses from individuals as offices or warehouses. A common question: if the individual landlord has not registered for tax, can the company still deduct the rental expense for Corporate Income Tax (CIT)? Let’s find out!
🌟 1. Introduction
Main keyword: Individual house rental
Companies frequently rent property from individuals. However, uncertainty often arises on whether rent paid to individuals without tax registration can still be deductible for CIT purposes.
✅ 2. Individual Rental Income ≤ VND 100 Million/Year
According to Article 4 of Circular 96/2015/TT-BTC, individuals with rental income of ≤ VND 100 million per calendar year are exempt from VAT and Personal Income Tax (PIT).
Note: In this case, tax authorities will not issue a one-off invoice to the individual landlord.
📌 For the rent expense to be deductible for CIT purposes, the company must prepare:
- Lease agreement: Clear contract between company and individual.
- Payment evidence: Cash voucher, bank transfer, or payment order.
- ID copy: National ID or Citizen ID of the landlord.
Important: No need to prepare Form 01/TNDN list per Circular 78/2014/TT-BTC.
✅ 3. Individual Rental Income > VND 100 Million/Year
If the landlord’s rental income exceeds VND 100 million/year, the individual is liable for VAT and PIT.
📌 If the company pays tax on behalf of the individual, prepare:
- Tax payment receipts: Treasury payment slip or electronic tax receipt.
The total rent expense (including tax) is deductible when calculating taxable CIT.
⚠️ 4. Conclusion
Companies renting from individuals without tax registration can still record the rental cost as deductible for CIT, provided that sufficient documents and evidence are maintained. The landlord’s tax registration status does not affect the company’s right to deduct rent expense.
If you need further tax or filing advice, contact MBA Audit Firm for timely and accurate support!
