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Tax on the purchase and sale of property in Thailand
The tax on real estate transfer tax called specific "SBT", the
"SBT" is due where the seller sells a property within 5 years from the date of acquisition.
If the seller is an individual and has the property over 5 years, the transfer of property is not subject to tax.
Secondly if property is in your record companies, the SBT will be due regardless
of the time of purchase of the property.
In practice, for the resale of property there is no fixed rule, when the party must pay the costs of transfer, usually the owners who sold their property
reclame often a cost-sharing, it's just negotiation, a "Deal" between the seller and buyer to pay the tax "SBT" reprensente that 3.3% of the property sold, or the amount estimated by
the Land Department (for cadastre) of the region's land purchase, which sometimes exceed the amount of sales agreement between the owner and the buyer, but in general the amount assessed property for the
payment of the tax "SBT" is less than the price agreement between the seller and the buyer.
It is noted that until 28 March 2010, the business tax "SBT" is reduced by 0.11%, a
measure taken by the Government to boost property sales. (See a favorable tax reform property in Thailand).
As an example for the payment of the "SBT", take the case of a couple who
bought a very nice 3 Rai of land near the sea for 150 000 Euros is less than 5 years and the sells around 300 000 Euros.
The amount of fees and charges would be divided as follows:
Amount payable by the buyer:
Stamp: 300 000 Euros x 0.5% = 1 500 Euros
Transfer: 300 000 Euros x 30% = 0.01 Euros
Total: 1 530 Euros
Amount payable by the seller:
"SBT" (Specific tax): 300 000 Euros x 0.11% = 330 Euros
Annual tax on land and properties in Thailand
In Thailand, there are only 2 types of
taxes levied on the properties. These are taxes (Land Tax) and the fee for the use of structures (Structure use tax), which simply means a tax on the ground after using it, building construction, home
... ... or ' farm (Hevea, rice, ... ..).
Note: Fields not used are not taxable.
1) The collection of property taxes levied on land ownership has few equals Thai / Bath per year,
small tax is so low that the office of the land "Land Office" rarely bother to ask, sometimes they wait several years before of the claim.
2) The fee for the use of structures
(Structure Usage Fee) is a tax payable annually over a property built on the land or the use thereof, the landowner must pay this amount every year.
The amount is equivalent to 12.5% of the actual rental value or the assessed property.
Ex: After building your house on your plot, you have to pay 12.5% on the assessed property constructed, for
example property valued at home or rental by the cadastre of the region is 5 000 Thai / Bath (monthly), you have to pay (5 000 Thai / Bath 12 x 60 months = 000 Thai / Bath x 12.5%) = 7 500 Thai / Bath
(approximately 170 euros) annual municipal income tax for your house.
If the owner rents the property built on the ground, the tenants of the premises are not subject to pay this tax.
But
at present the companies managing construction programs (Condominium or Village) are required to place tenants to pay it, the "rental fee of the soil" (Annual Ground Rent).
*** For
example, the collection of municipal taxes represent a current at about 10% of revenue for local government in Thailand, the comparison is its equivoque with developed countries or local taxes ranged
from 70 to 80% of administrative revenue of Commons.
Creating a Holging to purchase property in Thailand
The Act then current in Thailand does not allow the
acquisition not own, so the acquisition of real estate in Thailand this is through the creation of society in general because there are other possibilities how to buy or sell a land in Thailand .
The effect of the current law is that by preventing foreigners from owning land in the name, it does not prevent them to acquire property in Thailand. Because there are montages totally legal to purchase
real estate properties not paying taxes.
Simply buying a property is through companies registered in Thailand, but one of the shareholders of the company owning the property may itself be
a corporation that may be foreign-based preference in a country taxation has very flexible to avoid paying taxes too high on the benefits of it.
Example, TRANSACTIONS Realty with
the system of purchasing property through a holding company based abroad.
Mr. Duval has bought a plot of 2 Rai seen with the Phuket sea 5 years ago to 7 million Thai / Bath ago had a beautiful
villa with swimming pool after he had paid all finished 8 Million Thai / Bath, so the total land in Phuket and the construction of the villa with pool will cost him 15 million Thai / Bath (323 000
Euros). Today Mr.Duval sold his property for 47 million Thai / Bath (1 018 000 Euros), so it made a capital gain of 32 m.thai / Bath.
How the Thai state going to collect taxes and fees for this
transaction immobiliere with the creation of the holding company based abroad Answer: 0
Mr.Duval created his company in Thailand who purchased the land in Phuket, call
"Tropical.Co.Ltd", a shareholder who holds all power in this society is Mr.Duval itself (foreign individual) or a company call "Duval Holding, based in Hong Kong (Example) and is therefore
under the Thai law foreign legal persons. At the resale of the property, the transaction takes the form of sale of shares, ie Mr.Duval that will sell control of the Duval Holding, based in Hong Kong. In
Thailand there has changed, the landowner is always a Phuket Thai society "Tropical.Co.Ltd", and the shareholder decision to "Tropical.Co.Ltd" is always "Duval Holding, rather
than change owner, no transaction, no taxes, no tax.
Mr.Duval will pay a symbolic fee to the State Chinese in Hong Kong.
The financial system of buying property is fully
legal in Thailand, so long as there was no law in Thailand promoting easier for foreign investors.
The real question is how long can they afford to lose money on real estate transactions
offshore, Thailand's interest to let foreigners buy land in his own name.
Note: The tax on capital gain on the sale of a property called "Capital Gains Tax" does not
exist because there is no tax on capital gains in Thailand, unlike many other countries . Replacing a comparable tax on capital gains is "income tax" is generally between 1 and 3% on the
property.
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