Taxes On A Lease ?

[Thaifan2]

I am in the process of buying a house in Chiang Mai under the TGFs name for B 1.45 M. My lawyer tells me that on a 30 year lease i must pay Governament taxes every year but she can not even give me a ball park figure as to how high the taxes could be .Anyone here got a clue? The Lawyer tells me if i take a usufruct i would pay a one time tax of B 10,800 .With a usuafruct there can be problems if i need to sell the house i think ?

[InterestedObserver]

The initial transfer taxes and fees aside, the biggie is the annual tax on the lease payments. I believe it to be 12.5% of the yearly rental income. Annual land use taxes are next to nothing. You need to clarify who ownes the land (lessor) and who is the lessee of the land. Unless this is new construction, I doubt that actual ownership of the house will change hands.There are always problems when you need to sell a house that sits on somebody else's land.

Edited July 6, 2010 by InterestedObserver

[Thaifan2]

Its all a big headach ,but that 12.5 % of a pretend rental of B3,000 a month ( if the same pretend rental as a usufruct ) would make an annual tax of B4,500 which is not too bad .

[InterestedObserver]

With a usuafruct there can be problems if i need to sell the house i think ?

Unless the actual house is registered in your name at the land office it's not yours to sell, it belongs to the land owner..

[Khun Jean]

If you are still in the process make sure the house is in your name and the land in the TGF name.

Then get a usufruct for live on the land. This will make sure you can use the house (apart from TGF family/neigbhours/friends problems that they can create for you).

Selling the house can only be done with the agreement of the TGF and a willingness to make a new lease/usufruct if the sale is to a foreigner or sale of land if it is a Thai buyer. No problem if everything in the relationship is fine. When not, forget about the house, take the loss and move on.

Other possibility is to have the land and house in the TGF name and you have a lease with a right to sublease or sell the remainder of the lease to someone else. Above problems can arise too.

Or, you can rent or buy a condo.

[Thaifan2]

^ Thganks K .Jean .I will read your reply AGAIN in the morning when more sober .LOL !