Each counterparty who makes a transaction for Thai property, regardless the citizenship, must pay the following taxes:
Transferring Fee - 2% of the value of the property calculated by the Land Department. The payer of this tax is registered in the contract of sale. The tax needs to be paid to the representative of the Land Department on the day of transfer of ownership.
Stump Duty - is 0.5% of the property value stated in the contract or calculated by the Land Committee. The calculation is carried out at a greater cost. The payer of this tax is registered in the contract of sale. This tax is paid if this property has been owned by the last owner for more than 5 years, and if the owner, accordingly, should not pay.
Specific Business Tax - entrepreneurial tax. Entrepreneurial tax is withdrawn if the seller has owned the property for less than 5 years and amounts to 3.3% of the property value (indicated in the contract or calculated by the Land Department - which is higher). The seller has to pay the tax.
Withholding Tax - income tax. Established by Thai tax legislation and paid if the owner makes a profit by selling real estate. The base of the tax is the housing cost set by the Land Department, multiplied by a factor (from 50% to 92%). Its value depends on how many years a particular property was owned by the last owner:
92% - 1 year,
84% - 2 years,
77% - 3 years,
71% - 4 years,
65% - 5 years,
60% - 6 years,
55% - 7 years,
50% - 8 years+.
The size of income tax varies from 0 to 37%.
0 to 80,000 THB: 0%
80,001 to 100,000 THB: 5%
100,001 to 500,000 THB: 10%
500,001 to 1,000,000 THB: 20%
1,000,001 to 4,000,000 THB: 30%
An example of calculating the amount of tax payments when making of sale transaction.
- Estimated cost of 1 sq.m estimated by the Land Department 50,000 THB
- Apartment square: 100 sq m
- Estimated cost of the apartment: 5,000,000 THB
- Contract Cost: 6,000,000 THB
- The apartment was in the possession of the last owner: 3 years.
1. WithholdingTax - Income tax:
Estimated value = 5,000,000 THB
Amount reducing the tax base: 3 years in posession, 5,000,000*77% = 3,850,000 THB
The tax base (three year tenure) : 383,333.33 THB (5,000,000 - 3,850,000):3
1 to 80,000 = tax free
80,001 - 100,000 = 5% (1,000)
100,001 - 383,333.33 = 10% (28,333.23)
Total = 29,333.23 (1,000 + 28,333.23)
Multiply by the number of years in possession = 87,999.69 (29,333.23 x 3)
Total: income tax amount 87,999.69 THB (A)
2. Transferring Fee - property transfer tax: 5,000,000 x 2% = 100,000
Total: property transfer tax 100,000 THB (B)
3. Stamp duty:
In this case, this payment is not available, because the apartment has been owned for less than 5 years.
4. Specific Business Tax :
3.3% from the contract price or calculated by the Land Department. So far contract price is as following: 6,000,000 x 3.3% = 198,000 THB
Total: total business tax: 198,000 THB (C)
Total cost 385,999.69 (A + B + C)