Now, Here's A Good Question.........i Think.

[seaeagle]

I'm in the process of selling my house and land (oops, sorry, my wife is in the process of selling her house and land!), and the buyer has come up with a great question.

How does the Land Office know there is now a house on the land?

The purchaser knows that the land was bought just as 'land'. And we have now built a 4 bed villa with a pool on it. But, naturally, the chanote still just shows a square piece of land.

The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price.

I'm stunned that he could've found a loophole here. Is there one?

Okay, if he's storing up troubles for himself in the future, that's his problem, but on the face of it, I can see his logic.

Over to you guys..............

[trogers]

I believe the Land Office has surveyors. If they do make a check after the transfer that the building structure has not been declared, they will come after your wife (seller) for the extras plus a big fine.

Proceed at your own risk.

[dugout4]

I'm in the process of selling my house and land (oops, sorry, my wife is in the process of selling her house and land!), and the buyer has come up with a great question.

How does the Land Office know there is now a house on the land?

The purchaser knows that the land was bought just as 'land'. And we have now built a 4 bed villa with a pool on it. But, naturally, the chanote still just shows a square piece of land.

The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price.

I'm stunned that he could've found a loophole here. Is there one?

Okay, if he's storing up troubles for himself in the future, that's his problem, but on the face of it, I can see his logic.

Over to you guys..............

was the house not registerd when it was built?

[seaeagle]

I'm in the process of selling my house and land (oops, sorry, my wife is in the process of selling her house and land!), and the buyer has come up with a great question.

How does the Land Office know there is now a house on the land?

The purchaser knows that the land was bought just as 'land'. And we have now built a 4 bed villa with a pool on it. But, naturally, the chanote still just shows a square piece of land.

The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price.

I'm stunned that he could've found a loophole here. Is there one?

Okay, if he's storing up troubles for himself in the future, that's his problem, but on the face of it, I can see his logic.

Over to you guys..............

was the house not registerd when it was built?

Registered where?

All the registration needs are done at the local OrBorTor, and in the city Amphur for the house number / address.

No registration is carried out at the Provincial Land Office. Right?

[loverboy44]

As far as i know you need a building permission from the land office.

[johnnyk]

Yes, there should be a building permit but it is often issued after the place is built not before as in the west. I got mine after living in it for 18 months. Don't ask why, just get it, its an important piece of paper.

[Lannatyne]

Yes, there should be a building permit but it is often issued after the place is built not before as in the west. I got mine after living in it for 18 months. Don't ask why, just get it, its an important piece of paper.

In my experience, building permits are issued and granted by the Orbortor in the tambon where the hosue is built, not the land office in that province.

[trogers]

Yes, there should be a building permit but it is often issued after the place is built not before as in the west. I got mine after living in it for 18 months. Don't ask why, just get it, its an important piece of paper.

In my experience, building permits are issued and granted by the Orbortor in the tambon where the hosue is built, not the land office in that province.

It does not matter where the building permit is issued. What matters is that during the transfer of land title, the seller will have to declare what the land is used for and what structures are existing on it for tax assessment.

This was asked after my father-in-law's demise and the land title was transferred to his children. Tax is payable on such a transfer.

And we know the penalty of making a false declaration.

[slapout]

The loophole has always been there and yes some land with structures on them are transferred at land office for the land value. The land office in most areas have a valuation for the area/moo ban which so fees are based on that number, not what the purchaser/seller tell them (low figure). Many areas (town sites/ Agricultural) have been re surveyed in recent years due to the standardized valuation being implemented. If construction has taken place it is noted at land office. They seem to be the ones in charge of surveys.

[hhgz]

"was the house not registerd when it was built?"

"Registered where?"

My guess is that the answer to the first question is "no".

[fletchsmile]

Bit puzzled OP has never registered the property/house. Do we assume there is no tabian bahn either for the property as well?

Not really a loophole it's just called fraud - and hoping no-one finds out. This so called loophole could be applied to any business transaction - sell two things and declare only one as the sale at below actual price.

Suppose Einstein the buyer in turn wants to sell the house one day. How will he ever prove evidence of title to the house? Legally he has registered the land but nothing to prove he owns the house? This has a multitude of problems if you use your imagination:

- You or your wife could easily contest his right on anyone else's right to house title. You can show bills that you paid for it. He can't. The only way he could defend is by showing a fraudlulent deal that neither of you paid tax on

- Next person down the chain would have nothing to prove the house is theirs either. If they attempted to register it, then the fraud would become apparent. Who except another dodgy character would want to buy the house?

- What would he do for insurance - firstly insuring and secondly what he'd do to prove he had a house in the first place after a fire etc etc

Good question. Methinks not...

Edited October 29, 2009 by fletchsmile

[dugout4]

I would have thought that someone who was building a 4 bed villa with a pool would want to make sure that he had all the correct permission and paperwork to show it was all legal and above board so he wouldn’t have a problem when he wanted to sell it

(The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price)

So will the bill of sale just state he has just bought the land, if so could there be repercussions later ie tax evasion by the op.

I wouldn’t want to take the risk best to get a layer who knows the law i think

[seaeagle]

I would have thought that someone who was building a 4 bed villa with a pool would want to make sure that he had all the correct permission and paperwork to show it was all legal and above board so he wouldn't have a problem when he wanted to sell it

(The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price)

So will the bill of sale just state he has just bought the land, if so could there be repercussions later ie tax evasion by the op.

I wouldn't want to take the risk best to get a layer who knows the law i think

Thanks for all the replies. Risks to both parties, so I'm not going to do anything that could find it's way back to my family.

BTW, all permits and permissions, and tabien Baan are fine. Land Office have never dealt with these, just the Amphur in Muang, and the OrBorTor office in tambon where the house is. In fact, that was why I asked the question - no info ever goes through the Provincial Land Office about a house build, but they could, of course, do one of their random checks themselves sometime. Thanks guys.

[rgs2001uk]

I would have thought that someone who was building a 4 bed villa with a pool would want to make sure that he had all the correct permission and paperwork to show it was all legal and above board so he wouldn't have a problem when he wanted to sell it

(The purchaser is simply looking at a way to reduce his tax liability by declaring that he's just bought the land at a certain price, when, in reality, he's buying the land and villa for a much higher price)

So will the bill of sale just state he has just bought the land, if so could there be repercussions later ie tax evasion by the op.

I wouldn't want to take the risk best to get a layer who knows the law i think

I was always under the assumption the tax liability would be on the seller to pay the appropriate tax at the land office at the time of transfer of land deeds.

In fact if I was the purchaser I would insist the correct sale price was noted at the land office to prevent a higher tax bill should I ever sell the property at a future date.