House & Land Transfer, Mother to daughter.

[Miserman]

Hello

This is my first post so please bear with me!

My wife and I built a house in Hua Hin 2 years ago. We purchased the land prior to building 6 years ago and split the land into three three quarter rai plots and sold two to make a tidy profit. We then built a house on the plot we kept.

We live in the UK and the land was put in my wifes mothers name. No problems there. She travelled from Issarn many times to sort things out for us and is not a young woman. We did this as we are not in Thailand much so cannot keep popping over to keep an eye on things.

My wife wants to put the house and land in her name which I know she can do.

My questions are these:-

Will we need to pay the local tax? When we purchased the land we knew the owner and so the price was reduced for tax reasons but we obviously still gave over the correct amount of cash and we both paid 50% each which is fair.

I will need to pay all of any tax this time and the house and land is worth approximately 5 - 6 million baht now. Can the mother gift the house to her daughter and change the title name?

Can we say we have purchased the house/land for a nominal amount to keep tax down?

or

Is it easier just for her mother to leave the house/land in a will and when she dies this will transfer to my wife? In this scenario, will there be any tax to pay?

As you can probably detect I am after paying the least amount of tax possible to put the house in my wifes name.

I look forward to reading any replies, ideas and comments.

Kind regards

Miserman.

[Miserman]

Please can an administrator pass this to other forums please to try to get some responses - bangkok, Pattaya, Isaarn, Hua Hin, general topics?

Thank you.

[Crossy]

Please can an administrator pass this to other forums please to try to get some responses - bangkok, Pattaya, Isaarn, Hua Hin, general topics?

I think this is the best forum for this question. I've modified the topic title maybe it will attract more answers.

I suspect the main problem is that there are few of us who have been in this situation

[chiangmaibruce]

Is it easier just for her mother to leave the house/land in a will and when she dies this will transfer to my wife? In this scenario, will there be any tax to pay?

Miserman

I don't know how gifts are treated in Thai tax law so you need specialist advice in this regard, but I will comment on the Will issue.

I'd forget about "easier" as a decision criteria if at all possible. There are many many Thai families who are wracked with nasty & ongoing squabbles when someone passes on. You don't mention much about the extended family so I can't comment specifically on your circumstances. But consider:

your mum in law may never get around to doing a Will (even is she says she will)

she may make a mistake in the Will and it becomes invalid

If the Will is invalid or she never does one then your wife will only be eligible for a fraction of the property (depends on how many others in the equation and their ranking in Thai law as it pertaining to Wills)

OR

she may make a valid Will leaving the house to your wife but then years later have a fight with your wife, get bullied by other family members, etc etc, and change the Will (and possibly not tell you)

... all in all, quite a risk and paying a bit of tax now may be well worth the peace of mind

Edited June 5, 2009 by chiangmaibruce

[katabeachbum]

Ok Ill try

Transfer from mother to daughter requires transfer -tax. If you are legally married (in any country), you will need to sign in landoffice the property belongs solely to your wife, purchased for her money only. Its a good idea to register a lease in your name in the land deed, in case she dies or you split up. But the lease requires additional tax.

Tax

Land has a minmum value (baht/talangwah) decided by locals and landoffice, depending on location in HH. The house has a minimum value, sqm price (say 4-6k in HH) multiplied with number of sqm according to buildingpermit

To check lowest acceptable transfer value, bring land deed, buildingpermit (sqm) and Tabien Baan (resident) to land office and require. They will give you the exact acceptabel transfer value and tax payment.

Presently there is a tax-break in LOS on property transfers, expiring next year, so your transfer tax should not be high now.

Since you reckon the property is worth 5 mill baht, I d guess the accepted transfer value would be 1,5 mill baht, with 1-3% tax.Tax is reduced if the owner has been a resident in this Tabien Baan for a certain time.

I d guess the taxes are max 50.000 baht to transfer now.