The conclusion on property transfer differs upon the type of property being bought. If the property is an off-plan property then the transfer shall happen after the completion of the said development. If the property is completely built but paid upon by the buyer on installment, the transfer shall happen after the payment is completed in full. Yet, it is only upon the registration of the transfer of ownership of the said property at the land office when a property transfer can be considered completed.
Similar to other countries, property transfer in Thailand entails payment of certain taxes and other related fees. There are fees specifically assigned to a particular party while there are others in which the involved parties can negotiate how such fee or duty can be divided between them.
The following are the required fees in property transfer in Thailand:
- Transfer Tax – the tax rate is 2% of the value of the property basing on its registered value.
- Withholding Tax – the rate is 1% of the property’s appraised value.
- Special Business Tax – the rate is 3.3% and this shall only apply if the property is being sold within its first five (5) years of being owned.
- Stamp Duty – the rate is 0.5% of the registered value.
In case that the buyer and the seller negotiates on how much each of them will pay, the agreed amount should be included in the sales contract and all of these should be done prior to the transfer’s registration at the land office.
More about Withholding Tax (Income Tax)
Withholding tax is imposed upon the income gained from the sale but the schedule differs accordingly if the seller is a juristic person or a natural person.
If the seller is a natural person, the rate of withholding tax is based on a progressive income tax scale.
If the seller is a juristic person (company), the withholding tax is 1% of the assessed value or 1% of the sales price, whichever of the two is higher.
Siam Legal: The firm’s Legal Services and Conveyancing
Siam Legal is among the best full service law firm in Thailand. It has branches strategically located all around the Kingdom to cater the legal needs of local and foreign personalities and entities.
In case that the buyer will not be available during the transfer of the property is going to happen at the land office, Siam Legal can formulate a Power of Attorney to appoint the firm, any of its lawyers or another party to officially and legally represent the buyer. On the other hand, if the buyer can actually go to the said office, a lawyer of Siam Legal will be sent along with the buyer to make sure that his rights and interests are protected and maintained.
Another example on how the firm can help a property buyer is informing the buyer of the pertinent documents to be presented in order to complete the transfer as well as the estimated amount that needs to be paid i.e. tax and other administrative charges.