Transfer tax, income withholding tax, fees, stamp duty, business tax are paid at the land office
Condo conveyancing fees and taxes
CONDOMINIUM TRANSFER tax in Thailand is a tax imposed by the Thai government and paid at the local land office when transferring ownership of a condominium in Thailand. There are a variety of taxes and fees involved when transferring a condominium unit in Thailand; transfer fee, stamp duty, withholding tax (personal or corporate) and specific business tax (if applicable).
Transfer tax in case of a re-sale of an existing condo
Total transfer fees and taxes could range from a small amount to a relatively larger amount depending on the amount of income tax involved for the seller. Another variation of the transfer taxes and fees in case of a re-sale condominium relate to the agreement between the seller and buyer and how the buyer and seller of the condominium unit have agreed to share these costs.
Transfer tax and fees in a off-the-plan condominium project
Developing and selling new condominiums is a contract controlled business in Thailand and must comply with government regulations. One condition is that the buyer of a new unit or in an off-the-plan purchase of a condominium cannot be charged more than half of the 2% ownership transfer fee only. All other duties and taxes related to the registration and transfer of ownership must be paid by the developer. It is common that developers of condos in Thailand try to pass on transfer costs to the buyer for which they are by law responsible.
How to divide the conveyancing costs of an existing re-sale condo
How ownership transfer fees and taxes are split in a private sale, and at what percentage, depends on the agreement between the seller and buyer. As there is in a private sale no fixed rule or legal requirement how to split these costs it can vary from seller pays all to buyer pays all (which could include paying the seller's personal withholding tax). It is advisable for a purchaser of a re-sale condominium to clearly confirm with the seller in the condominium sale and purchase agreement who will be responsible for transfer fees and all taxes and/or at what percentage.
The local custom in Thailand in a private sale of a condominium is to divide the taxes and fees involved with the transfer of a condominium as follows:
|Transfer fees||rate= 2%||the buyer's duty or shared|
|Specific Business Tax (SBT)
||rate= 3.3 %
||the seller's duty|
|Stamp duty||rate= 0,5%*||the seller's duty|
|Withholding tax (income)||rate= 1% or progressive rate**||the seller' duty (as this relate to the seller's personal or corporate income tax)
Note: stamp duty does not have to be paid if specific business tax is applicable. When a privately owned condo is sold within 5 years of acquisition the sale is considered 'sale of an immovable property in a commercial or profitable manner' (section 91 bis Revenue Code) and subject to 3,3 % sspecific business tax (assessment tax) calculated over the government appraised value (meaning the once every 4 years assessed market value of the condo in the opinion of the land and treasury department) or actual sale price of the unit, whichever is higher. The transfer is exempt from specific business tax if the condo is transferred without consideration, for example by inheritance to a legal heir or the owner transfers the condo to a legitimate child or when a privately owned condo is sold after 5 years from the date of acquisition. The transfer fee has a rate of 2 % and is always calculated over the government appraised value of the condo. Personal income withholding tax (retention tax) is calculated at a progressive rate based on the years of ownership using the government appraised value of the unit for calculation. Under Thai tax laws the land office must take the income withholding tax at the time of transfer, even if the the seller of the condo is a foreigner who is a resident in another country. When the condo is owned and sold by a Thai company the 3,3% specific business tax must generally be paid irrespective the years of ownership, and corporate income withholding tax is fixed at a rate of 1% of the registered sale value or appraised value, whichever amount is higher.
Sample clause Condominium SPA
Taxes and Expenses Relating to the Transfer of OwnershipThe following taxes will be paid in full prior to the transfer of ownership of the Unit and will be paid by:
Special Business Tax (if any)
|: the Buyer and Seller equally
: the Seller
: the Seller
The Seller shall be solely responsible for individual income withholding tax and other necessary expenses, if any, incurred in relation to the registration of transfer ownership of the Unit.
Sample existing condo transfer tax calculation in Thailand
Condo transfer taxes and fees relate to the transfer of ownership of a condominium unit. In case of obtaining a registered long term leasehold interest in a condominium there are lease registration fees of 1,1% over the total rental involved and rental income from renting out the condo is subject to personal income tax.
The Thailand transfer sample tax and fees indication below is based on the transfer of a condominium apartment unit in Thailand with an appraised and registered sale value of 5 million Thai Baht and 3 years of ownership by the current owner. Approx transfer tax and fees of a condo in Thailand (value of 5 million):
- Transfer fee 2% over 5,000,000 THB = 100,000 THB
- Specific Business Tax Local Tax 3.3% = 165,000 THB
- Individual Withholding Tax approx 100,000 THB
- Application fee and others approx. 300 THB
Transfer Document List for individual foreign buyer of a condominium in Thailand
- Passport (หนังสือเดินทางชาวต่างชาติ)
- Evidence of money transferred from aboard to the value of the condominium Tor Thor 3/ FET Form or credit note.) The money should be transferred from abroad in foreign currency and exchanged into Thai baht by the Thai recipient bank. (ใบทธ. 3 เป็นหลักฐานการโอนเงินจากต่างประเทศ เท่าราคาอาคารชุดที่ต้องการซื้อ)
- Marriage/divorce certificate (if applicable) (ถ้าได้ทาการสมรส หรือหย่าแล้ว ให้นาทะเบียน นั้นๆ ไปแสดง)
- Power of attorney, if anyone but yourself is representing you, in Thai scrip with a notarization by Notary Public or if overseas by the Thai consul. (หนังสือมอบอานาจ ต้องมีฉบับภาษาไทยด้วย)
- Certified copy of the I.D. cards of the person giving authorization and the authorized persons. (สาเนาบัตรประชาชนผู้มอบอานาจ และผู้รับอานาจ พร้อมลายเซ็นรับรองสาเนาถูกต้องทุกแผ่น)
- Certified copy of the house registration of the person giving authorization and the authorized person. (สาเนาทะเบียนบ้านผู้มอบอานาจ และผู้รับอานาจ พร้อมลายเซ็นรับรองสาเนาถูกต้องทุกแผ่น)
All documentary evidence should not be exceed 30 days old หมายเหตุ หลักฐานและหนังสือรับรองต่างๆต้องไม่เกิน 30 วัน