Procedures for requesting to change the form of land rental payment for the project

Procedures for requesting to change the form of land rental payment for the project is a solution that helps investors be more flexible in financial management and optimize land use costs. Correct implementation of legal regulations not only ensures legality in the process of adjusting financial obligations but also helps businesses be proactive in long-term investment plans, facilitates calculating business efficiency and minimizes legal risks arising.

Is it allowed to request to change the form of land rental payment for the project?

According to the provisions of Clause 1, Article 30 of the Land Law 2024, economic organizations, public service units, individuals, people of Vietnamese origin residing abroad, and economic organizations with foreign investment capital that are being leased land by the State with annual land rent payment but are in the case of being leased land by the State with one-time land rent collection for the entire lease period according to regulations can choose to switch to land lease with one-time land rent payment for the remaining land lease period.

In this case, it is necessary to re-determine the land price to calculate the land rent at the time of the decision to allow conversion to land lease in the form of one-time land rent payment for the entire lease period as prescribed.

Thereby, the tenant is allowed to switch from paying annual land rent to a one-time payment for the remaining lease term.

On the contrary, economic organizations, individuals, people of Vietnamese origin residing abroad, and economic organizations with foreign investment capital that are being leased land by the State with a one-time land rent payment for the entire lease period can choose to switch to land lease with annual land rent collection. Paid land rent is deducted from the annual land rent payable according to Government regulations.

Changing the form of land rent payment helps businesses be flexible in managing cash flow, optimizing costs and adjusting financial plans according to the actual situation of the investment project. Especially for long-term projects, switching the form of land rental payment can create significant financial advantages.

>>> See more: The right to choose the form of land rental payment of the enterprise.

Procedures for requesting to change the form of land rental payment for the project

To carry out the procedure for requesting to change the form of land rental payment for the project to suit the financial requirements, investors need to keep in mind the following contents.

Documents need to be prepared

Pursuant to the provisions of Article 51 of Decree No. 102/2024/ND-CP. Dossier requesting to change the form of land rent payment must include all required documents to ensure legality and speed up the processing process by the competent authority.

The dossier includes a written request to change the form of land allocation or land lease according to Form 02d in the Appendix issued with Decree 102/2024/ND-CP and one of the following documents:

• Certificate of land use rights, Certificate of house ownership and residential land use rights, Certificate of house ownership, Certificate of ownership of construction works, Certificate of land use rights, ownership of houses and other assets attached to land have been issued;
• One of the types of documents specified in Article 137 of the Land Law 2024;
• Decisions to allocate land, decisions to lease land, and decisions to allow change of land use purpose by competent state agencies according to the provisions of land law over time.

Implementation procedures

The procedure for changing the form of land rent payment is regulated according to specific steps, ensuring transparency in the application processing process. Article 51 of Decree No. 102/2024/ND-CP has detailed instructions on the process of implementing procedures for changing the form of land rent payment for investment projects.

Step 1: Submit application

The land user submits an application to change the form of land rent payment at the application receiving agency, the One-Stop Department, according to the regulations of the Provincial People’s Committee on receiving documents and returning results of administrative procedures at the provincial, district and commune levels.

Step 2: Appraisal of documents

The receiving agency is responsible for checking the completeness and validity of the dossier and issuing a receipt.

After that, the agency with land management function completes the dossier and submits it to the People’s Committee of the competent level to issue a decision allowing the conversion of the form of land rent payment, along with the content of the land price to calculate land use fees, land rent payable and the tax authority’s responsibilities in guiding land users to pay land use fees and land rent according to the provisions of law on land use fees and land rent.

Step 3: Return results

The time to process a dossier to change the form of land rent payment is no more than 20 days from the date of receipt of complete and valid dossiers. During the processing process, the competent state agency will appraise the conversion conditions, determine the land price, calculate the amount of land rent payable and issue a decision allowing the conversion of land rent payment method.

Step 4: Complete tax obligations

After a decision is made to allow changing the form of land rent payment, the tax authority will determine the amount of land rent payable and notify the land user. Land users are responsible for paying land rent according to the notice and re-signing the land lease contract with the land management agency.

How to calculate rent when changing the project’s form of land rent payment

The method of calculating land rent when converting the form of land rent payment is specifically stipulated in Article 33 of Decree 103/2024/ND-CP. The way to calculate land rent depends on the form of conversion and the status of financial obligations of the land user.

In case of changing from renting land with annual land rental payments to renting land with one-time payment of land rent for the entire lease period:

In case the State issues a decision allowing the land user to switch from annual land lease payment to one-time land lease payment for the entire lease term, they must pay one-time land rent for the remaining lease term according to the provisions of Clause 2, Article 30, Decree 103/2024/ND-CP.

The land rental unit price for one-time land rental payment for the remaining land rental period is determined according to the provisions of Clause 2, Article 26, Decree 103/2024/ND-CP; in which the land price used to calculate the land rental unit price is the land price at the time the State issues the decision to allow conversion to land lease with one-time land rental payment.

In case of changing from renting land with one-time payment of land rent for the entire lease period to renting land with annual payment of land rent, the land rent is calculated as follows:

• In case the land rental obligation has been fulfilled, the land user does not have to pay annual land rental for the remaining land rental period.
• In case the land rent obligation has not been fulfilled, the land user must pay land rent annually from the time the State issues a decision allowing the switch from renting land with one-time payment for the entire lease period to renting land with annual payment. For the period of land use, it will be handled as follows:

In case the land rent has not been paid, the land user must pay the land rent for the period of land use:

Land rent must be paid	=	The land rental amount is paid in one lump sum for the entire land rental period	x	Time spent using land
		Land lease term

At the same time, land users must pay late payment interest on land rent calculated on the amount of land rent payable according to the provisions of law on tax administration from the time the competent state agency decides to lease the land to the time of permission to switch from land lease with one-time payment of land rent for the entire lease period to land lease with annual payment of land rent.

In case a part of the land rent has been paid but the paid amount is less than the payable amount (excluding late payment interest), the land user must pay the remaining amount and the amount of late payment of land rent is calculated on the outstanding amount according to the provisions of law on tax administration.

In case the amount paid is greater than the amount payable according to regulations (excluding late payment interest), the increased difference will be deducted from the annual land rent by converting into the number of years and months in which the annual land rent obligation has been completed according to the annual land rent unit price determined according to the land price at the time the State issued the decision allowing the switch from renting land with one-time payment of land rent for the entire lease period to land rent with annual payment of land rent.

Consulting services to support changing the project’s form of land rent payment at Long Phan Consulting Company

Consulting services to support changing the project’s form of land rental payment is an effective solution to help businesses save time, costs and ensure compliance with legal regulations. Long Phan Consulting Company provides professional services in the field of land and investment, supporting customers to complete procedures for changing the form of land rental payment.

Long Phan Consulting Company’s consulting services include:

• Analyze the current legal status of investment projects and land use rights;
• Consulting on choosing a form of land rent payment that is consistent with the business’s financial strategy;
• Prepare documents requesting to change the form of land rent payment;
• Business representatives work with competent state agencies;
• Monitor document processing progress and resolve arising problems;
• Consulting on implementing financial obligations after deciding to change the form of land rent payment.

Long Phan Consulting Company’s team of experts has extensive experience in handling legal issues related to land. This helps ensure that the application for changing the form of land rent payment is fully prepared, accurate and meets the requirements of competent state agencies.

Frequently asked questions

Below are frequently asked questions about procedures for converting project land rent payment methods.

Can I request to change the project’s land rental payment method?

Yes, according to the Land Law 2024, economic organizations, public service units, individuals, overseas Vietnamese, and foreign-invested economic organizations that are leasing land with annual payments can switch to one-time payment if they fall into the case of one-time payment. On the contrary, people who are paying once can also switch to paying annually if needed.

What documents need to be prepared to request a change in land rent payment method?

Documents include the application, decision or land lease contract, land use right certificate (if any), project approval decision or investment certificate, land rent payment voucher (if any), copy of ownership documents of assets attached to the land (if any), and bank approval document if the property is mortgaged.

What is the procedure for changing the method of paying land rent?

Step 1: Submit application to the Department of Natural Resources and Environment or Provincial Public Administration Service Center.

Step 2: The receiving agency evaluates the application and issues a receipt.

Step 3: The competent authority appraises, determines the land price, calculates the rent and issues a decision. The tax authority will notify the amount to be paid, and the land user will pay and re-sign the land lease contract. Processing time should not exceed 30 days.

How is land rent calculated when converting the payment method?

When switching from annual to one-time payment, the one-time land rent for the remaining period is calculated according to the land rent unit price at the time of the conversion decision. When switching from one-time to annual, if you have paid in full, you do not have to pay more. If not paid in full, the amount payable for the time used is calculated according to the ratio of the time used to the total rental period, multiplied by the land rent paid in one lump sum. Additional late payment fees may arise.

How is the land rental unit price for a one-time payment for the remaining lease period determined?

The one-time land rental unit price of the remaining land rental period is determined according to the provisions of Clause 2, Article 26, Decree 103/2024/ND-CP, based on the land price at the time the State issues the decision to allow conversion.

If I have fulfilled the obligation to pay land rent once, do I have to pay land rent annually when converting?

No, if the obligation to pay land rent once for the entire lease period has been fulfilled, the land user does not have to pay annual land rent for the remaining land lease period upon conversion.

In case the land rent has not been paid in one lump sum, how is the annual land rent calculated?

The annual land rent will be calculated from the time the State issues a decision allowing conversion. For the period of land use, the land user must pay land rent according to the formula: (Land rental amount paid in one lump sum for the entire land lease period x Land use period) / Land lease term.

What happens if you have already paid part of the land rent in one lump sum when you switch to paying it annually?

If the paid amount is less than the payable amount, the land user must pay the remaining amount and late payment interest. If the paid amount is larger, the difference will be deducted from the annual land rent by converting into the number of years and months in which the obligation has been completed according to the annual land rent unit price at the time of conversion.

Which agency has the authority to handle procedures for changing the form of land rent payment?

The Department of Natural Resources and Environment where the land is located is the agency that receives and processes applications for changing the form of land rent payment.

What is the maximum time to complete the conversion procedure?

The time to process a dossier to change the form of land rent payment is no more than 30 days from the date of receiving a complete and valid dossier.

Is it necessary to re-sign the land lease contract after converting the form of land rent payment?

Yes, after the decision to change the form of land rent payment, the land user needs to re-sign the land lease contract with the land management agency.

Conclude

Understanding and properly implementing the procedures for requesting to change the form of land rental payment for the project will help businesses optimize costs and be flexible in financial management. Customers who need in-depth consulting support on procedures for changing the form of land rent payment, please contact Long Phan Consulting Company via the hotline: 1900636389 to analyze the optimal solution and support in implementing the necessary legal procedures.