Business Tax If Selling Before 5 Years

[DavidBrook]

if you buy a condo and sell it within 5 years, apparently you need to pay business tax (5% or or thereabouts as I understand it). Some months ago, in order to stimulate the property market, this was reduced to 1.1%. The law has apparently been promulgated, Land department has implemented it but apparently the Revenue Department are delaying - presumably because they don't have any money.

Does anyone have better information or does anyone know when the reduction is coming into force? I have a condo that I and the buyer would quite like to transfer quickly but 70k is a sum I would like not to have to pay if I have a choice...

All responses welcome.

D

Edited May 7, 2009 by DavidBrook

[tangoll]

The reduced revenue tax (also called Specific Business Tax) of 0.11% of transaction value terminated on 28 March 2009 (after being in effect for one year), and the revenue tax reverted to its normal value of 3.3% from that date for condo units whose years of calculation is 5 years or less. Note that this years of calculation is not same as years of ownership; it is the number of years spanning the calendar from the prior transfer to the current transfer.

All in, your total tax and fees for transfers for condo units will be 4% up to 6% of transaction value going from 1 to 5 years, and then dropping back to 4% for 6 years.

The transaction value is the value you declare to the Land Dept office for the transfer. It's not necessarily the sales price. If the seller is a Thai national, and the property had been the primary residence, there are other deductions, but I do not know about this.

I do not know about calculations for land property transactions.

[quiksilva]

Its been extended. I posted the official notification elsewhere on these forums already.

[tangoll]

quiksilva, you did post the notification, but do you know what the notification actually says? It's all in Thai, and what does the "it's" in your post refer to? Anyway, the info from the Land Dept office is that the transfer tax of 0.01% has been extended for another year from 29 Mar 2009 to 28 Mar 2010. But, the Specific Business Tax was not extended and has reverted to the pre-reduction rate of 3.3%. I got this info from my real estate agent who checked with the Land Dept office on 29 March 2009, and I have not heard any update since. I hope I'm wrong and that the Spec Bus Tax reduction has also been extended. Perhaps you heard or know different.

[qbkh]

How about those buying condo and reselling it before the completion and transfer of the condo? still 3.3%

[DrDave]

How about those buying condo and reselling it before the completion and transfer of the condo? still 3.3%

Correct - Specific Business Tax has to be paid if the unit was never titled (no tabien baan). I think that this is because a transaction like this is considered to be more of a business transaction, rather than a personal transaction. But, as others have pointed out - I believe that the SBT has been reduced from the usual 3.3% to .11% until the end of March 2010.