Title Transfer Charges

[irakthai]

I'm looking for some insight on title transfer charges and am hoping that the knowledgeable members of TV can help.

Some months ago my fiancé agreed to purchase 21 rai of land from a distant relative. There were around 10 rai of immature rubber trees and the remaining 11 rai was scrub. The agreed price was THB 800,000 which was a reasonable price for the land. At the time the title (not sure if this is the correct term) was TB5 and was being held by a bank as security against a loan.

After months of toing and froing the bank was paid out, the title released and the transaction was finally completed. In the process the title was changed from TB5 to NS3 and my fiancé was given an indication that Chanote would be coming in 1-2 years time.

We knew that a transfer fee (again, not sure if this is the correct term) would be payable at settlement and when I asked how much my fiancé replied that she didn't know and would only find out on the day the transfer was finalised. On the appointed day she went to the office next to the Amphur and was told that the transfer fee as determined by the "boss of the land office" (her term) was just over THB 60,000.

That night I queried the amount (10% of the transaction value) and I asked her if she was certain that the calculation was correct, and could she verify this anywhere. The answer to both questions was no. I then asked how the fee was calculated and was told that she didn't know. At that point I was getting frustrated and gave up. She just accepted the amount in blind faith but I'm not inclined to do so (yeah, I know I'm being farang here).

My questions are -

1) How is this transfer fee calculated? (value of the transaction, estimated value of the land, a blind guess ...)

2) How is the rate determined and are the rates published or available anywhere?

3) How do you know if the calculation has been done correctly (since she was only provided with a total not a breakdown)?

4) Would changing the title from TB5 to NS5 have resulted in higher costs?

Any insight from anyone with knowledge or experience with such matters would be greatly appreciated.

Irakthai

[kamalabob2]

Welcome to "land office" in rural Thailand. Not exactly my favorite office.

This link can help answer some of your questions and there are real estate professionals on this forum (I am NOT) who can clarify.

http://www.siam-legal.com/Properties-Servi...roperty-tax.php

If you do a search on this forum search function you will see many answers.

Your girl friend can get a "breakdown" or itemized receipt at the land office, probably in Thai. It really might be worth your time to scan and e-mail any written ESTIMATES from the land office to a legal advisor in your area or in Bangkok to make sure your girl friend is not being cheated. Maybe one of the forum sponsors or a different attorney you hire can look at your paperwork and make a call/visit to the land office when the transfer takes place so that her rights are protected and the fee is "straight". Or e-mail back to you the correct amount and explanation in Thai and English to save "face" at the land office. Good luck.

[irakthai]

kamalabob2, thanks for your help. The web page pretty much answered my questions.

We finally managed to get this sorted. As explained in the Siam Legal web site we were charged a transferring fee of 2% and stamp duty of 0.5%. We were also charged an additional fee of approx. THB17,000 because the title was upgraded from TB5 to NS3. We were refunded an amount of THB22,000 being the balance of the THB60,000 we were charged up front.

At the time the new title was collected from the land office we were informed that Chanote would be issued sometime in the next couple of years however if we wished to jump the queue and get the Chanote issued immediately we could pay a one-time fee of THB5,000. We declined.

I'm still not sure why we were made to pay THB60,000 up front for the transfer. From what I can gather it seems that the "Boss of the office" is the only person who can calculate the fees and as he was away that day (mind you, we attended on the day nominated by the Land Office) a subordinate opted to make what appears to be a wildly inaccurate guess. Regardless, it's finished now and I'm happy with that.

irakthai

[MJo]

It seems that temporary tax breaks will continue. Just received this from CBRE...

As part of the Thai government’s economic stimulus package and effort to boost the local property market further in the current state of the economy, the government recently announced a reduction in the Specific Business Tax. This follows a one year extension of the reduction in Property Transfer Tax from 2% to 0.01% on 28th March 2009.

By Royal Decree, issued in accordance with the Revenue Code Regarding Tax Reduction (No.488) B.E. 2552, dated 19th May 2009, the Specific Business Tax (SBT) has been reduced from 3.3% to 0.11% for a period of one year, beginning from 28th March 2009. The reduction applies for sales of all types of real estate including condominium buildings and units.