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ResourcesThailand Real Estate & Property LawConveyancing and Property TransferSpecific Business Tax on Real Estate Transactions in Thailand

Specific Business Tax on Real Estate Transactions in Thailand

See transcript of the above video below:

As the title of this video suggests, we are discussing the Specific Business Tax and how is assessed on real estate transactions in the Kingdom of Thailand.

So for some background, what are we talking about? Basically this is going to be applicable on an individual who is selling property or a company which is selling property where that individual or company has only had possession, AKA legal title, over that piece of real estate for 5 years or less.

So what this essentially is doing is it is a tax on sort of flipping property for lack of a better term.  You know property development tax in a sort of it into a roundabout way.

So the thing to take away from this video also is where the specific business tax is assessed, it's not necessary to deal with things like a duty stamp. In cases where it's a long-term piece of property that's been held by a given party for a long period of time you have to deal with a transfer fee but you still have to deal with respect to transfer and convincing a real property in Thailand through the land office but you don't have to deal with duty stamps where you have the specific business tax to deal with.  What is the amount? Well the amount is 3.3% of the appraised value of the real estate or the contract sale price of the real estate, whichever is higher. So they're going to assess it based on either the appraised value or the contractual value, whichever is higher, they're going to take 3.3%. On top of that, as mentioned in a video about transfer fees on this channel, you are looking at 2% also of the appraised or contractual value just for the transfer fee.

So in cases where it is a piece of real estate that has been in the possession of the seller for less than 5 years, you're looking at 5.3% just in terms of Land Department fees associated with conveyancing. 

As stated in previous videos and I'll state again, strictly speaking it is the seller's responsibility to deal with this but that being said it's a good idea for the buyer to know this because these amounts, and these percentages, are going to factor into things like the sale price and the overall process of getting the conveyancing accomplished. So it's good for the buyer to be aware that these exist and understand that you're going to be dealing with a substantially different set of transfer fees associated with the conveyancing real estate that has been held by the seller for less than five years at the time of the conveyancing and at the time that the land transfer occurs.