Land Office Fees Going Up March 26 (correction)

[robinhill]

One last point : one of the comments above suggested that the fee for the registration of a loan / mortgage had also been reduced to 0.11% - I hadn't heard of this, and according to our local land office this comment was erroneous too.

Therefore, there is no change in the cost for the registration of loan / mortgage, lease, usufruct or superficies agreements - the fee for such remains as before (which I understand is 1% of the value of such).

Although, having said this, I also bounced this one off a Thai property lawyer today who said that the loan/mortgage fee is currently 0.01%

I've queried this with him and am awaiting his reply.

You can't help but smile at all this confusion eh? )

In my experience even some "professionals" have been a little confused over certain aspects of Thai property law - I shan't name names - hence it's best to get a good book on the subject (Rene Phillipe's) and read through the relevant parts of the Thai Civil and Commercial Code (TCCC) to understand the legality of Thai property law and how contract agreements are written to relate to and comply with such law.

For those who don't wish to use the Thai Company route for property purchase there are ways in which you can secure virtual freehold rights legitimately under Thai law - but don't be fooled about renewal options for leases - such rights are not secure, and securing such rights is the key to such "virtual" freehold rights. Nor does securing such rights have to cost a fortune.

Another point of interest which perhaps relates to this subject is a recent piece of Thai law which is the Constitution of the Kingdom of Thailand, the law of which overrides/rescinds any previous law. Hence the "equal rights" of citizens arguably rescinds the law within the TCCC which discriminates against women, including any restrictions which apply to their ownership of land when married to a foreigner (the money having to be "Sinsod" = theirs before marriage). A declaration of such is still enforced at the land office, and this is, arguably, now "unconstitutional" and could be taken to court as such.... as far as I know no one has as yet, but should the Thai authorities ever try to grab back land from Thai women married to foreigners this would indeed be unconstitutional in relation to the relevant sections within the Constitution of the Kingdom of Thailand.... Thailand's overriding law which has precedence over all other law made previously, including of course the TCCC.

[robinhill]

Ok, so let's try an example. A farang owns land/property in a Thai nominee company. Value is, say, 5M Baht. He has read this thread and is now nervous. Wants to transfer that land to his wife and close the company down. What is the current fee and would would the new fee be starting in April????? It would be really interesting to hear what you think for this example....

Hi Craig, that's pretty straightforward to answer...

Company sale of land with construction of building (more than 5 years old) :

Assessed Value = 5 million baht

Sale Price = 5 million baht

Sale by March 26th or before :

Transfer fee of 0.01% = 500 baht (based on the Assessed Value)

Stamp Duty of 0.5% = 25,000 (based on the registered Sale Price)

Withholding Tax = 1% = 50,000 (based on the Assessed Value or Sale Price, whichever is the higher)

Sale after March 26th :

Transfer fee of 2% = 100,000 baht

Stamp Duty of 0.5% = 25,000

Withholding Tax = 1% = 50,000

...a difference of some 99,500 baht!

Company sale of land with construction of building (less than 5 years old) : Sale Price 5 million baht

Sale by March 26th or before :

Transfer fee of 0.01% = 500 baht (based on the Assessed Value)

Stamp Duty of 0.5% = not applicable

Special Business Tax of 0.11% = 5,500 baht (based on the Sale Price)

Withholding Tax = 1% = 50,000 (based on the Assessed Value or Sale Price, whichever is the higher)

Sale after March 26th :

Transfer fee of 2% = 100,000 baht

Stamp Duty of 0.5% = not applicable

Special Business Tax of 3.33% = 165,000 baht

Withholding Tax = 1% = 50,000

...a difference of some 259,000 baht!

NOTE : When you add the total %age of the above (2% + 0.5% + 3.33% + 1% = 6.83%) this is close to a total of around 6.5%, which could well have been what the lady in the article meant to convey but perhaps said in a misleading way.

You could mitigate the cost of the fees by reducing the registered Sale Price at the land office... this should also be bourne in mind in relation to the company's profit on the disposal of the land/property.

In all reality the Assessed Value at the land office is usually a lot less than the Sale Price, so the fees are likely to be less than the above, but since you did not provide me with the Assessed Value for this calculation I have calculated the fees as if it is the same as your Sale Price.

Also, if you intend to effect a sale of land from your company, transferring it into your Thai wife's name, then according to land office practice the money that your Thai wife would need to buy the land / property would have to be hers prior to marriage, and therefore you cannot "loan" the money to your wife for such a purchase (you actually have more options if you are not officially married, a misconception amongst most farangs who think that marrying a Thai gives them more options not less).

As noted above, such practice by the land office is now arguably "unconstitutional" in my opinion, in terms of equal right for all, but would take a court test case to change the current practice at the land office. There may be some loophole in the constitution which in my reading of it I failed to notice.

Anyway, I hope the above is helpful.

[bhawani]

Can anyone provide me a ball park figure how much I'd have to pay at the Land office for transfer in my personal ( foreign ) name for a condo at a new development in Pattaya. The value of the condo being ... say 1.6 Million THB.

Edited February 26, 2010 by bhawani

[craigt3365]

Ok, so let's try an example. A farang owns land/property in a Thai nominee company. Value is, say, 5M Baht. He has read this thread and is now nervous. Wants to transfer that land to his wife and close the company down. What is the current fee and would would the new fee be starting in April????? It would be really interesting to hear what you think for this example....

Hi Craig, that's pretty straightforward to answer...

Company sale of land with construction of building (more than 5 years old) :

Assessed Value = 5 million baht

Sale Price = 5 million baht

Sale by March 26th or before :

Transfer fee of 0.01% = 500 baht (based on the Assessed Value)

Stamp Duty of 0.5% = 25,000 (based on the registered Sale Price)

Withholding Tax = 1% = 50,000 (based on the Assessed Value or Sale Price, whichever is the higher)

Sale after March 26th :

Transfer fee of 2% = 100,000 baht

Stamp Duty of 0.5% = 25,000

Withholding Tax = 1% = 50,000

...a difference of some 99,500 baht!

Company sale of land with construction of building (less than 5 years old) : Sale Price 5 million baht

Sale by March 26th or before :

Transfer fee of 0.01% = 500 baht (based on the Assessed Value)

Stamp Duty of 0.5% = not applicable

Special Business Tax of 0.11% = 5,500 baht (based on the Sale Price)

Withholding Tax = 1% = 50,000 (based on the Assessed Value or Sale Price, whichever is the higher)

Sale after March 26th :

Transfer fee of 2% = 100,000 baht

Stamp Duty of 0.5% = not applicable

Special Business Tax of 3.33% = 165,000 baht

Withholding Tax = 1% = 50,000

...a difference of some 259,000 baht!

NOTE : When you add the total %age of the above (2% + 0.5% + 3.33% + 1% = 6.83%) this is close to a total of around 6.5%, which could well have been what the lady in the article meant to convey but perhaps said in a misleading way.

You could mitigate the cost of the fees by reducing the registered Sale Price at the land office... this should also be bourne in mind in relation to the company's profit on the disposal of the land/property.

In all reality the Assessed Value at the land office is usually a lot less than the Sale Price, so the fees are likely to be less than the above, but since you did not provide me with the Assessed Value for this calculation I have calculated the fees as if it is the same as your Sale Price.

Also, if you intend to effect a sale of land from your company, transferring it into your Thai wife's name, then according to land office practice the money that your Thai wife would need to buy the land / property would have to be hers prior to marriage, and therefore you cannot "loan" the money to your wife for such a purchase (you actually have more options if you are not officially married, a misconception amongst most farangs who think that marrying a Thai gives them more options not less).

As noted above, such practice by the land office is now arguably "unconstitutional" in my opinion, in terms of equal right for all, but would take a court test case to change the current practice at the land office. There may be some loophole in the constitution which in my reading of it I failed to notice.

Anyway, I hope the above is helpful.

Perfect. Thanks so much. Just have to figure out what to do now! It's a minefield no mater which way you go...I think the fee is something like 15,000B a year for the company. It doesn't take many years before it adds up to the amount for transferring it now...

I forgot about the money having to come from her...but she lived in the US for 5 years. I am sure we could prove that she earned it while overseas working???? The money originally used to purchase this company came from her bank account here in Thailand...which was funded via a transfer from a joint account in the US...

[robinhill]

I forgot about the money having to come from her...but she lived in the US for 5 years. I am sure we could prove that she earned it while overseas working???? The money originally used to purchase this company came from her bank account here in Thailand...which was funded via a transfer from a joint account in the US...

You don't so much have to prove anything (unless it is ever disputed), just sign a declaration to the effect that the money being used was hers before marriage (Sinsod).

Doing so gives you no claim whatsoever to the property though.

In view of this, you should ensure that she makes a will for you to inherit the property in the event of her death, such that the relatives have no claim. You are allowed to inherit land as a foreigner, but must dispose of it (sell/transfer) within 12 months.

You can secure rights to the property via a lease agreement, and/or usufruct, or superficies, but unfortunately you can not "loan" the money to your wife to purchase the property, which is one way to help secure renewal rights (non-lease rights which are not transferable should the land owner sell the land or another inherit it).

Personally, I think that this law, part of the Thai Civil and Commercial Code, ought to be reviewed by the land department in view of the Constitution of the Kingdom of Thailand law, which in my opinion makes such discriminatory law "unconstitutional". It was not so many years ago that the law was changed to allow women with foreign husbands to own land, but if Thailand is to take its Constitution seriously, instead of it paying mere lip service to the international community, then it's about time that Thai women with foreign husbands are not discriminated against in contradiction to the essence of such Constitutional law.

Do I hear a "Here Here!!" from the audience?

Perhaps this would also help discourage foreigners using Thai companies with nominee shareholders as a vehicle for land purchase, which is what they want to achieve, right?!?

[robinhill]

Can anyone provide me a ball park figure how much I'd have to pay at the Land office for transfer in my personal ( foreign ) name for a condo at a new development in Pattaya. The value of the condo being ... say 1.6 Million THB.

Well, this doesn't provide all of the info required for the calculation, nevertheless from the info already provided above you should be able to figure it out. However, in order to provide a further example to aid understanding, I'll proceed with the illustration, and for the purpose of the exercise let's assume a few things...

Condo is less than 5 years old

Assessed Value : 1.6 million baht

Sale Price : 1.6 million baht

Transfer by March 26th 2010 :

Transfer fee of 0.01% : 160 baht (based on the Assessed Value)

Stamp Duty of 0.5% : not applicable (based on the Sale Price)

Special Business Tax of 0.11% : 1760 baht (based on the Sale Price)

Withholding Tax of 1% : 16,000 baht (based on the Assessed Value or Sale Price, whichever is the greater)

Total = 17,920 baht (1.12% of the condo's value)

Transfer after March 26th 2010 :

Transfer fee of 2% : 32,000 baht

Stamp Duty of 0.5% : not applicable

Special Business Tax of 3.33% : 53,280 baht

Withholding Tax of 1% : 16,000 baht

Total = 101,280 baht (6.33% of the condo's value)

Don't forget also that if you wish to register a lease then this will cost another 1% (16,000 baht).

Also remember that if the lease is for more than 3 years then it MUST be registered at the land office, otherwise it is not worth the paper it's written on since Thai law demands this, and not to comply with the law in this respect makes the lease invalid/unenforceable.

[way2muchcoffee]

I forgot about the money having to come from her...but she lived in the US for 5 years. I am sure we could prove that she earned it while overseas working???? The money originally used to purchase this company came from her bank account here in Thailand...which was funded via a transfer from a joint account in the US...

You don't so much have to prove anything (unless it is ever disputed), just sign a declaration to the effect that the money being used was hers before marriage (Sinsod).

Doing so gives you no claim whatsoever to the property though.

In view of this, you should ensure that she makes a will for you to inherit the property in the event of her death, such that the relatives have no claim. You are allowed to inherit land as a foreigner, but must dispose of it (sell/transfer) within 12 months.

You can secure rights to the property via a lease agreement, and/or usufruct, or superficies, but unfortunately you can not "loan" the money to your wife to purchase the property, which is one way to help secure renewal rights (non-lease rights which are not transferable should the land owner sell the land or another inherit it).

Personally, I think that this law, part of the Thai Civil and Commercial Code, ought to be reviewed by the land department in view of the Constitution of the Kingdom of Thailand law, which in my opinion makes such discriminatory law "unconstitutional". It was not so many years ago that the law was changed to allow women with foreign husbands to own land, but if Thailand is to take its Constitution seriously, instead of it paying mere lip service to the international community, then it's about time that Thai women with foreign husbands are not discriminated against in contradiction to the essence of such Constitutional law.

Do I hear a "Here Here!!" from the audience?

Perhaps this would also help discourage foreigners using Thai companies with nominee shareholders as a vehicle for land purchase, which is what they want to achieve, right?!?

Here here. Hear Hear?

In any case it is difficult to say that in a marriage 1/2 of the accumulated assets belong to the wife regardless of how they were obtained, but at the same time saying that she cannot use her share of the assets to purchase land unless she can prove that those assets derived only from her efforts.

[LivinLOS]

Personally, I think that this law, part of the Thai Civil and Commercial Code, ought to be reviewed by the land department in view of the Constitution of the Kingdom of Thailand law, which in my opinion makes such discriminatory law "unconstitutional". It was not so many years ago that the law was changed to allow women with foreign husbands to own land, but if Thailand is to take its Constitution seriously, instead of it paying mere lip service to the international community, then it's about time that Thai women with foreign husbands are not discriminated against in contradiction to the essence of such Constitutional law.

Do I hear a "Here Here!!" from the audience?

What and stant routes to PR and citizenship like western women who marry thai guys ??

[robinhill]

What and stant routes to PR and citizenship like western women who marry thai guys ??

???

I'm not really sure what you mean here.... is "stant" a mispelling? ...if so, of what? 'stand' or 'stunt' or something else?

I'm not being critical here, unlike some others who seem to enjoy doing little else on bulletin boards, just trying to understand what it is you mean.

In saying what I said in my previous post, I'm just supporting equal rights for men and women, that's all. Is there something wrong with this?

[ChiangMaiFun]

What and stant routes to PR and citizenship like western women who marry thai guys ??

???

I'm not really sure what you mean here.... is "stant" a mispelling? ...if so, of what? 'stand' or 'stunt' or something else?

I'm not being critical here, unlike some others who seem to enjoy doing little else on bulletin boards, just trying to understand what it is you mean.

In saying what I said in my previous post, I'm just supporting equal rights for men and women, that's all. Is there something wrong with this?

I think he meant INstant? and typed too quickly - I do it all the time

[Naam]

But its relatively easy to determine if the company performs real economic activity..

Simple things like the company must (or rather will be taxed) on a min turnover a year, or demand a min taxation amount at a level they decide. Real company's have no problem, farangs with dormant shell companies holding land start getting another bill annually.

which i consider quite fair and acceptable!

[craigt3365]

Can anyone provide me a ball park figure how much I'd have to pay at the Land office for transfer in my personal ( foreign ) name for a condo at a new development in Pattaya. The value of the condo being ... say 1.6 Million THB.

Well, this doesn't provide all of the info required for the calculation, nevertheless from the info already provided above you should be able to figure it out. However, in order to provide a further example to aid understanding, I'll proceed with the illustration, and for the purpose of the exercise let's assume a few things...

Condo is less than 5 years old

Assessed Value : 1.6 million baht

Sale Price : 1.6 million baht

Transfer by March 26th 2010 :

Transfer fee of 0.01% : 160 baht (based on the Assessed Value)

Stamp Duty of 0.5% : not applicable (based on the Sale Price)

Special Business Tax of 0.11% : 1760 baht (based on the Sale Price)

Withholding Tax of 1% : 16,000 baht (based on the Assessed Value or Sale Price, whichever is the greater)

Total = 17,920 baht (1.12% of the condo's value)

Transfer after March 26th 2010 :

Transfer fee of 2% : 32,000 baht

Stamp Duty of 0.5% : not applicable

Special Business Tax of 3.33% : 53,280 baht

Withholding Tax of 1% : 16,000 baht

Total = 101,280 baht (6.33% of the condo's value)

Don't forget also that if you wish to register a lease then this will cost another 1% (16,000 baht).

Also remember that if the lease is for more than 3 years then it MUST be registered at the land office, otherwise it is not worth the paper it's written on since Thai law demands this, and not to comply with the law in this respect makes the lease invalid/unenforceable.

I am still not sure what I am going to do. I don't plan on selling for a long time...but who knows what the future holds? One good thing about the company route is making it easier to sell to a farang. I know when I bought this it was a only a few days to close the deal. Really nice. Another is that I have never heard of anybody losing their house due to company/nominee issues. I know there is an ill wind blowing, but nothing so far...and us homeowners are just a drop in the bucket compared to the international companies and their holdings....

[robinhill]

According to the property lawyer I spoke with - the land office fee for registration of loan/mortgage agreement on or before 26th March 2010 is 0.01% if this applies to a property which you are transferring ownership of at the same time. If you are merely registering a loan/mortgage against a title deed which you are not transferring the ownership of then the fee is 1% (or 1.1% when the local tax is also added).

[scorecard]

I believe this is inaccurate - the date is 26th for condos

I'm confused, can someone please give me some direction on this.

Here's the situation:

- Selling my condo in Bangkok (chanut is in farang name), was purchased about 6 years ago.

- Agreement for sale already signed for 4.6Million Baht.

- Agreement includes clause that lands title office costs / taxes will be shared 50/50.

- Change of name on chanut will be about 2 months from now , approx. 1st of May 2010 (unfortunately cannot be earlier)

- My lawyer says total costs at land title office (Bangkok) will be approx. 200,000-Baht.

Can TV members please confirm that approx. 200,00Baht for lands title costs is correct.

Thanks.

[ChiangMaiFun]

I believe this is inaccurate - the date is 26th for condos

I'm confused, can someone please give me some direction on this.

Here's the situation:

- Selling my condo in Bangkok (chanut is in farang name), was purchased about 6 years ago.

- Agreement for sale already signed for 4.6Million Baht.

- Agreement includes clause that lands title office costs / taxes will be shared 50/50.

- Change of name on chanut will be about 2 months from now , approx. 1st of May 2010 (unfortunately cannot be earlier)

- My lawyer says total costs at land title office (Bangkok) will be approx. 200,000-Baht.

Can TV members please confirm that approx. 200,00Baht for lands title costs is correct.

Thanks.

The transfer bit is 2%? so 92,000 (I believe?)

[scorecard]

Can anyone provide me a ball park figure how much I'd have to pay at the Land office for transfer in my personal ( foreign ) name for a condo at a new development in Pattaya. The value of the condo being ... say 1.6 Million THB.

Well, this doesn't provide all of the info required for the calculation, nevertheless from the info already provided above you should be able to figure it out. However, in order to provide a further example to aid understanding, I'll proceed with the illustration, and for the purpose of the exercise let's assume a few things...

Condo is less than 5 years old

Assessed Value : 1.6 million baht

Sale Price : 1.6 million baht

Transfer by March 26th 2010 :

Transfer fee of 0.01% : 160 baht (based on the Assessed Value)

Stamp Duty of 0.5% : not applicable (based on the Sale Price)

Special Business Tax of 0.11% : 1760 baht (based on the Sale Price)

Withholding Tax of 1% : 16,000 baht (based on the Assessed Value or Sale Price, whichever is the greater)

Total = 17,920 baht (1.12% of the condo's value)

Transfer after March 26th 2010 :

Transfer fee of 2% : 32,000 baht

Stamp Duty of 0.5% : not applicable

Special Business Tax of 3.33% : 53,280 baht

Withholding Tax of 1% : 16,000 baht

Total = 101,280 baht (6.33% of the condo's value)

Don't forget also that if you wish to register a lease then this will cost another 1% (16,000 baht).

Also remember that if the lease is for more than 3 years then it MUST be registered at the land office, otherwise it is not worth the paper it's written on since Thai law demands this, and not to comply with the law in this respect makes the lease invalid/unenforceable.

I am still not sure what I am going to do. I don't plan on selling for a long time...but who knows what the future holds? One good thing about the company route is making it easier to sell to a farang. I know when I bought this it was a only a few days to close the deal. Really nice. Another is that I have never heard of anybody losing their house due to company/nominee issues. I know there is an ill wind blowing, but nothing so far...and us homeowners are just a drop in the bucket compared to the international companies and their holdings....

But remember that you need to keep the company records up to date; company returns every six months and annually, tax and audit returns also to be submitted along with the annual company report, etc.

I pay about 13,XXXBaht a year. It all adds up.

Further, Thailand cancels the registration of companies quite quickly if the annual returns etc are not submitted.

I asked my lawyer a long time ago "What happens to the ownership of the house and/or land is the company is de-registered".

He answered that the house / land ownership is now in 'total limbo' / 'no mans land', and it's possible that it will stay like this for many years. He also mentioned that there is a long history of property in this category mysteriously / quietly being transferred to land oficials.

[robinhill]

I'm confused, can someone please give me some direction on this.

Here's the situation:

- Selling my condo in Bangkok (chanut is in farang name), was purchased about 6 years ago.

- Agreement for sale already signed for 4.6Million Baht.

- Agreement includes clause that lands title office costs / taxes will be shared 50/50.

- Change of name on chanut will be about 2 months from now , approx. 1st of May 2010 (unfortunately cannot be earlier)

- My lawyer says total costs at land title office (Bangkok) will be approx. 200,000-Baht.

Can TV members please confirm that approx. 200,00Baht for lands title costs is correct.

Thanks.

Sale Price : 4.6 million baht

Assessed Value : ? Let's assume 4 million (it may well be quite a bit less than this)

Age of Condo : More than 5 years, owned for 6 years, therefore Stamp Duty and personal Withholding Tax applies

Transfer fee of 2% = 80,000 baht (2% of Assessed Value)

Stamp Duty of 0.5% = 23,000 baht (0.5% of Sale Price)

Special Business Tax of 3.3% = not applicable

Withholding Tax* = 130,000.02 baht (based on the Assessed Value)

Total = 80,000 + 23,000 + 130,000 = 233,000 baht

50% of 233,000 = 116,500 baht

* Withholding Tax (based on the Assessed Value)

4,000,000 - (60% of 4,000,000) / 6 years

= 4,600,000 - 2,400,000 / 6 years

= 1,600,000 / 6 years

= 266,666.67 per year taxable income

Tax = (100,000 baht x 5%) + (166,666.67 x 10%) per year

= 5,000 + 16,666.67 = 21,666.67 baht per year x 6 years = 130,000.02 baht

Remember, this is only a guide since we do not know the true Assessed Value.

With a lower Assessed Value, so the total approaches the 200,000 baht figure quoted.

[caf]

The Sarapee land office are quoting the new 26 March rates. Is there a source I can give to indicate to them what the current correct rates are.

We are transferring on Friday and the seller is paying all taxes and fees except the 0.01% transfer fee which is split 50 50.

No house yet, only two tracts of land totalling 950k baht. The land has been in the family for at least 20 years. It's agreed I will be given a superficie.

caf

[kloghead]

Can anyone provide me a ball park figure how much I'd have to pay at the Land office for transfer in my personal ( foreign ) name for a condo at a new development in Pattaya. The value of the condo being ... say 1.6 Million THB.

Well, this doesn't provide all of the info required for the calculation, nevertheless from the info already provided above you should be able to figure it out. However, in order to provide a further example to aid understanding, I'll proceed with the illustration, and for the purpose of the exercise let's assume a few things...

Condo is less than 5 years old

Assessed Value : 1.6 million baht

Sale Price : 1.6 million baht

Transfer by March 26th 2010 :

Transfer fee of 0.01% : 160 baht (based on the Assessed Value)

Stamp Duty of 0.5% : not applicable (based on the Sale Price)

Special Business Tax of 0.11% : 1760 baht (based on the Sale Price)

Withholding Tax of 1% : 16,000 baht (based on the Assessed Value or Sale Price, whichever is the greater)

Total = 17,920 baht (1.12% of the condo's value)

Transfer after March 26th 2010 :

Transfer fee of 2% : 32,000 baht

Stamp Duty of 0.5% : not applicable

Special Business Tax of 3.33% : 53,280 baht

Withholding Tax of 1% : 16,000 baht

Total = 101,280 baht (6.33% of the condo's value)

Don't forget also that if you wish to register a lease then this will cost another 1% (16,000 baht).

Also remember that if the lease is for more than 3 years then it MUST be registered at the land office, otherwise it is not worth the paper it's written on since Thai law demands this, and not to comply with the law in this respect makes the lease invalid/unenforceable.

I am still not sure what I am going to do. I don't plan on selling for a long time...but who knows what the future holds? One good thing about the company route is making it easier to sell to a farang. I know when I bought this it was a only a few days to close the deal. Really nice. Another is that I have never heard of anybody losing their house due to company/nominee issues. I know there is an ill wind blowing, but nothing so far...and us homeowners are just a drop in the bucket compared to the international companies and their holdings....

But remember that you need to keep the company records up to date; company returns every six months and annually, tax and audit returns also to be submitted along with the annual company report, etc.

I pay about 13,XXXBaht a year. It all adds up.

Further, Thailand cancels the registration of companies quite quickly if the annual returns etc are not submitted.

I asked my lawyer a long time ago "What happens to the ownership of the house and/or land is the company is de-registered".

He answered that the house / land ownership is now in 'total limbo' / 'no mans land', and it's possible that it will stay like this for many years. He also mentioned that there is a long history of property in this category mysteriously / quietly being transferred to land oficials.

robinhill

The more I read on this topic the more confused I become. Can you explain what taxes and percentages would be involved for the following situation:

1) I'm a company buying a bare plot of land from a Thai individual (not company) who has owned the said plot for less than a year. For simplicity let's say the sale price is one million baht. The transaction will take place before 26th March 2010.

2) Same circumstances regarding the sale but the transaction takes place after 26th March.

Thanks so much for taking the time and effort to explain all this in your previous posts. The WT/SBT as it applies to my situation have me baffled...

Edited March 3, 2010 by kloghead

[caf]

The Sarapee land office are quoting the new 26 March rates. Is there a source I can give to indicate to them what the current correct rates are.

We are transferring on Friday and the seller is paying all taxes and fees except the 0.01% transfer fee which is split 50 50.

No house yet, only two tracts of land totalling 950k baht. The land has been in the family for at least 20 years. It's agreed I will be given a superficie.

caf

[oracle]

The Sarapee land office are quoting the new 26 March rates. Is there a source I can give to indicate to them what the current correct rates are.

We are transferring on Friday and the seller is paying all taxes and fees except the 0.01% transfer fee which is split 50 50.

No house yet, only two tracts of land totalling 950k baht. The land has been in the family for at least 20 years. It's agreed I will be given a superficie.

caf

Caf, you have to pay 2% as the reduced transfer fee rates only apply on specified properties, this does not include a single land plot.

[beejoir]

So I'm still all a little lost by this new change, our situation is:

My Wife is going to buy a new shop house, (we are not registered in Thailand as being Husband and Wife) she is paying for the whole thing, its in her name and nothing to do with me.

Will the TAX on this be the old lower rate, or the new 6% ?

The Building is an older Sukhumvit shop house for around 4,000,000

[ChiangMaiFun]

So I'm still all a little lost by this new change, our situation is:

My Wife is going to buy a new shop house, (we are not registered in Thailand as being Husband and Wife) she is paying for the whole thing, its in her name and nothing to do with me.

Will the TAX on this be the old lower rate, or the new 6% ?

The Building is an older Sukhumvit shop house for around 4,000,000

It is irrelevant if she is Thai, farang, married or not married

[quiksilva]

Correct, nationality or marital status is irrelevant all that matters is when you transfer.

[beejoir]

So will she have to pay 1% or 6% if she buys after the 26th?

[quiksilva]

The total could be up to 6.3% of the purchase price, if the seller is subject to specific business tax.

note that its quite normal practice for these fees to be split between both parties. Typical cost sharing arrangements that I see are

Buyer pays transfer fees @ 2%.

The Seller pays withholding tax @ 1% (which they must do by law) and specific business tax @ 3.3% which is also supposed to be to the seller's account, (but after negotiation this is often agreed to be shared with or passed on to the buyer)

[robinhill]

The Sarapee land office are quoting the new 26 March rates. Is there a source I can give to indicate to them what the current correct rates are.

We are transferring on Friday and the seller is paying all taxes and fees except the 0.01% transfer fee which is split 50 50.

No house yet, only two tracts of land totalling 950k baht. The land has been in the family for at least 20 years. It's agreed I will be given a superficie.

caf

Apologies for my late response on this - I remember typing a reply but must have had a connection problem and didn't realize that it had not gotten posted.

Undeveloped land is not subject to the reduced rates, therefore if your land purchase falls into this category then the fees will be the same now or after the 26th March :

2% Transfer Fee based on the Assessed Value

0.5% Stamp Duty based on the registered Sale Price

Withholding Tax based on the Assessed Value and the number of years of ownership according to the aforementioned sliding tax scale (see previous posts above)

The above is assuming that you are actually transferring the ownership of the land, and not merely registering just the Superficies Agreement.

If the latter, then there will be a land office fee for the registration of the Superficies Agreement of 1% of the amount which you are paying for such Superficies rights.

You should ensure that you can comprehend fully the Superficies Agreement which you and the land owner are signing (a dual language clause by clause agreement is best), and that it is sufficiently comprehensive in nature such that you can not lose such rights by way of the land owner transferring ownership of the land to another person or by way of inheritance. You should also ensure that you have the right to transfer the rights of the Superficies Agreement to a third party, and the right to Lease the immovable property which you "own" for the duration of its ownership by way of Superficies.

Most importantly, you should ensure that the contract agreement which both parties are signing is the one which is actually registered against the title deed at the land office, and that it is registered against the correct title deed too. There are a number of scams which can be perpetrated against unwary foreigners, so "caveat emptor"....which is amusing to think that Thais are more likely to pronounce this Latin phrase correctly )

[robinhill]

So I'm still all a little lost by this new change, our situation is:

My Wife is going to buy a new shop house, (we are not registered in Thailand as being Husband and Wife) she is paying for the whole thing, its in her name and nothing to do with me.

Will the TAX on this be the old lower rate, or the new 6% ?

The Building is an older Sukhumvit shop house for around 4,000,000

You start by referring to a "new shop house" and then later say that it is "an older Sukhumvit shop house", I'm assuming then that this is not in fact a newly constructed property, but one which has been constructed for several years, or at least more than 5 years ago, such that it will not be subject to Special Business Tax and will instead be subject to Stamp Duty at 0.5% of the registered Sale Price.

In addition to this Stamp Duty, you will also have to pay a Transfer Fee based on the Assessed Value, and the Transfer Fee will be 0.01% if the registration of change of ownership is completed on or before 26th March 2010, or 2% if thereafter (the land offices being closed on Saturday and Sunday prior to the new rates coming into effect on the Monday).

If the shop house is currently owned by a company, then it is classed as a company sale, and Withholding Tax is calculated at 1% of the Assessed Value or registered Sale Price, whichever is the greater (normally the latter).

If the shop house is currently owned by an individual, then it is classed as a personal sale, and Withholding Tax is calculated based on the Assessed Value and in accordance with the duration of ownership and also in accordance with a sliding tax scale, as per my previous posts on the subject above.

If you want to know more, I suggest that you nip down to Asia Books and try and get a copy of Rene Phillipe's book, or buy it online.

[robinhill]

So will she have to pay 1% or 6% if she buys after the 26th?

If you backtrack on this thread and read through my previous replies and example calculations there's ample information there to allow you to comprehend the fee structure and where and when it applies. The fact that you refer to "6%" suggests to me that you may not yet have found these posts in amongst the numerous entries on this thread.

Good luck with your wife's purchase and whatever business (you and) she intend to operate from it.