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Tax and cost calculation for transferring property in Thailand



TAX

AMOUNT


Transfer fee

2% of registered value

Stamp Duty

0.5% of registered value

Withholding Tax

1% of appraised value

Business Tax

3.3% of appraised value


It is between seller and buyer to negotiate who pays what in regards to taxes when transferring property or land in Thailand. The Norm is for both seller and buyer shared the cost equally of property taxes in transferring a property, however as there are no absolute laws in Thailand concerning the transfer of property and how the costs are borne.


Example of how to Calculate Taxes and Costs:

 

1. Suppose that the government assessed price is Baht 50,000 per Sq.m.

2. All areas are 100 Sq.m.

3. The total assessed price is Baht 5,000,000

4. Actual selling price is 6,000,000

5. The Seller possessed this property for 3 years


1. Withholding Taxes

 

The government assessed price = 5,000,000 Baht Deduction with the expense of possession for 3 years for 77% = 3,850,000

Balance = 1,150,000 (5,000,000 – 3,850,000) Divided by the 3 year of possession Balance = 383,333.33 (1,150,000/3) Taxation on progression rate 1 to 80,000 = exempt 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 year of possession = 87,999.69 (29,333.23 x 3)

In this case withholding tax is Baht 87,999.69 (A)


2. Government Fee for Transfer

 

Is 2% based on the government assessed price so 5,000,000 x 2% Balance = 100,000

Transfer fee is 100,000 (B)


3. Stamp Duty

 

In this case is exempt. This is because transaction is subject to the specific Business Tax (possession of less than 5 year before sale).


4. Specific Business Tax

 

3.3% for Specific Business Tax based on the government assessed price or sale whichever is higher. In this case sale price is higher than government so 6,000,000 x 3.3% = 198,000.

Specific Business Tax is Baht 198,000 (C)


Total expenses are: Baht 385,999.69 (A+B+C)

 











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