Condo Conveyance Tax in Thailand - transfer fees
Condominium Conveyance Tax: Total transfer fees and taxes involved with the transfer of ownership of a condominium unit in Thailand could range from a relatively small amount to a larger amount depending on the value and the amount of income tax involved for the seller. In a sale and purchase of a newly built condominium unit in a condo development under the Condominium Act
the law specifies that the developer may ONLY pass the transfer fee for a percentage of 50% of the total transfer fee to the buyer. In the transfer of an existing condominium in Thailand there is no fixed rule or legal requirement how to split fees and taxes associated with the transfer and how these costs and fees are shared. How these cost are split and at what percentage depends in the end on the bargaining power of the parties involved. Note that the seller's personal income withholding tax is part of the taxes and fees to be paid at the Land Office. Prior to buying or selling, paying a deposit or signing a sale and purchase agreement for a condominium in Thailand , it is advisable for a purchaser and seller of a condo in Thailand to clearly confirm in writing who will be responsible and at what percentage the parties are responsible for transfer fees and taxes. This is normally part of the condominium sale and purchase agreement outlining the sales process and responsibilities of the parties.
The local custom in Thailand to divide taxes and fees involved with the transfer or conveyance of an existing condominium is as follows:
* Transfer fees at 2%; the buyer's duty or shared
* Specific Business Tax 3% + 10% local municipal tax over the amount of Specific Business Tax = total tax of 3,3%; the seller's duty or shared
* Stamp duty; the seller's duty or shared between the seller and purchaser (does NOT have to be paid if Specific Business Tax is paid)
* Withholding tax; as this relate to seller's personal or corporate income tax this should be the seller's duty only.
Sample existing condo conveyance tax calculation in Thailand
Thailand transfer sample tax and fees indication based on the transfer of a condominium apartment unit in Thailand with an appraised value of 5 million Thai baht after 3 years of ownership by the current private owner. In the transfer of an existing condominium unit in Thailand some specific exemptions on condominium transfer fees and taxes may be applied based on the number of years of possession of the condominium and if specific business tax is paid by the seller.
| Transfer before March 28 2010 (under the temporary rate reduction): 1. Transfer fee 0.01% over 5,000,000 THB = 500 THB 2. Specific Business Tax & Local Tax 0.11% = 5,500 THB 3. Individual Withholding Tax approx 100,000 THB 4. Application fee and others approx 300 THB Total: 106,300 THB
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Transfer of a condo (value of 5 million) under the normal rates: 1. Transfer fee 2% over 5,000,000 THB = 100,000 THB 2. Specific Business Tax & Local Tax 3.3% = 165,000 THB 3. Individual Withholding Tax approx 100,000 THB 4. Application fee and others approx. 300 THB Total: 365,300 THB
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Related: Buying a condominium in Thailand
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Transfer costs of a privately owned condominium in Thailand
What you must pay depends A. on the number of years of ownership (4 years and 5 months counts for 5 years) and B. the appraised government value of the condominium. For private owners, including foreign owners, withholding income tax shall be calculated over the registered sale price at a progressive rate and withheld by the Land Department upon transfer and registration of ownership - with a deduction depending on the number of years of possession as follows: 1 years = 92% - 2 years = 84% - 3 years = 77% - 4 years = 71% - 5 years = 65 % - 6 years = 60% - 7 years = 55% - 8 years or more = 50%
Personal income tax rates in Thailand: Less than 100,000 baht = 5% - Between 100,000 and 500,000 baht = 10% - Between 500,000 and 1,000,000 baht = 20% - Between 1,000,000 and 4,000,000 baht = 30% - More than 4,000,000 = 37%
If at the time of transfer of ownership of the unit the period of ownership is less than 5 years specific business tax is charged at a rate of 3.3% - if at the time of transfer the condo is held for a period exceeding 5 years stamp duty is charged at a rate of 0.5%.
A transfer fee of 2% is charged over the appraised government value of the condo.
