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Thailand Property Tax and Fees



Transaction Costs on Purchase (condominium, house, land)

✅  Transfer Fee 2% of the appraised value of the property

✅  Business Tax 3.3% of the appraised value if sold within 5 years

✅  Stamp Duty 0.5% of the registered value

Withholding tax:

  • If the seller is a company withholding tax is fixed at 1% over the registered sale value or appraised value (whichever is higher)
  • If the seller is a private person withholding tax is calculated at a progressive rate based on the appraised value of the property 


Note:

  • Stamp duty is exempt if Specific Business Tax is charged.
  • The Specific Business Tax does not have to be paid if the seller has possessed the property for more than 5 years.
  • The Specific Business Tax does not have to be paid if the seller transfers the real property to a legal heir by will.
  • The Specific Business Tax does not have to be paid if the seller transfers the real property to a legitimate child.
  • The Specific Business Tax does not have to be paid if the seller transfers the real property to a temple, church or mosque.


Lease Registration Fee

✅  Registration Fee 1%

✅  Stamp Duty 0.1%

As there are no restrictions on the foreign ownership of a lease, it is possible for foreigners to buy leasehold interests in Thailand property and register the lease directly in a personal name, or in the name of a company.

Thailand property lease registration fee is charged at the rate of 1% of the total lease throughout the whole lease term and collected by the land office at the time of registration. Also, stamp duty is collected at a rate of 0.1% of the total rental throughout the lease term. The total transaction cost for leasehold is 1.1%.


Who pays what when Transferring Real Estate

Unless you are buying from a developer in a licensed housing or condominium development there is no fixed rule for who pays which part of the land office transfer fees and taxes. It is part of the overall price negotiation to come up with an appropriate formula for sharing these costs and it can vary from sale to sale. It's most important that you have resolved this on the Reservation Agreement so both parties are clear and it can be spelled out in the contact.

In a private sale of real property (condominium, house, land) the following division of taxes and fees are commonly paid by:

Specific Business Tax :   the seller's duty
Stamp duty:   the seller's duty
Transfer fees:   the buyer's duty or shared
Withholding tax:   always the seller's duty


Fees when buying a newly built condominium directly from a builder:

When purchasing Thailand property in an off-plan condominium development the developer may only pass up to half of the transfer fee (2%) to the purchaser. Under consumer protection laws the developer is responsible in full for specific business tax and income withholding tax. Therefore, your total tax should be 1% when purchasing an off-plan condominium.


Appraised Value vs Registered Value

The appraised (government assessed) land office value of a property is often much lower than the actual sale price or market value of a Thailand property. The appraised property valuations are set by the Treasury Department and the Land Department and adjusted every 4 years. In practice, when selling a property in Thailand typically both parties agree on declaring and registering the sale price close to the appraised value as this decreases the overall taxes for both parties. This is a common and known practice when transferring property in Thailand.


Share Transfer

When the property is owned by a Thai company, there are two ways for "ownership" to be passed to a new owner: either to sell the company (share transfer) or transfer the property out of the company. In the case where the property is transferred out of the company, this constitutes a sale and the taxes and fees mentioned above apply. But if both parties are willing to do a share transfer, transaction costs are therefore limited to 0.1% stamp duty payable on the share sale.


Using a Realtor

One of the guiding principles behind tax planning is that everyone has the right to organize their business and personal affairs so as not to pay more tax than the law requires. This planning should take place before your purchase of Thailand property. A good realtor can help to minimize your tax exposure.



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