Apartment management boards must pay taxes on advertising and common area rentals.

This development marks a significant shift in Vietnam’s real estate regulatory landscape, emphasizing fiscal transparency for apartment management boards. Previously, many boards treated income from common area rentals—such as ATM spaces, elevator advertising, or telecom station leases—as informal revenue, often sidestepping tax declarations. The Khánh Hòa Tax Department’s explicit guidance now forces boards to treat these activities as taxable business operations under VAT and CIT laws. For investors and buyers, this means management boards must adopt stricter financial governance, potentially increasing operational costs. However, it also reduces opaque revenue pools, enhancing trust in fee usage. In the short term, boards may pass tax burdens to tenants or advertisers, slightly raising common fees or rental rates. For property investors, this is a net positive: clearer financial management improves asset valuation and reduces legal risks. I recommend boards immediately audit all income sources, register for tax codes, and implement transparent accounting. Failure to comply could lead to retroactive tax assessments and penalties, undermining property values. This move aligns with Vietnam’s broader push for formalization in the real estate sector, benefiting long-term market stability.