Tranfer Costs Of Townhouse

[burgerking]

Just a small question for anyone out there in the know.

Have just bought a townhouse (Nontaburri are) for 1.2 million baht, what will be the total transfer costs, including all the taxes, to be paid to have the house tranfered into my wifes name. As the deal was when i bought the place i will be paying all costs involved.

[backflip]

Your real estate broker can tell you that, right down to the baht.

[burgerking]

I didn't use a real estae agent/broker to purchase the property. It was a cash sale which the wife made she will be heading down to the land office, in the next couple of weeks and am interested to find out how much she is up for.

Many thanks to anyone in the know.

[Dragonman]

I didn't use a real estae agent/broker to purchase the property. It was a cash sale which the wife made she will be heading down to the land office, in the next couple of weeks and am interested to find out how much she is up for.

Many thanks to anyone in the know.

I'm afraid there are too many variables for anyone but the Land Office to give an accurate figure. Generally it is advised to budget for around 3%. Although I paid much less!

[burgerking]

Thanks Dragonman

Now, i have a fair idea of what the wife is up for.

Many thanks

[SunbeltAsia]

Just a small question for anyone out there in the know.

Have just bought a townhouse (Nontaburri are) for 1.2 million baht, what will be the total transfer costs, including all the taxes, to be paid to have the house tranfered into my wifes name. As the deal was when i bought the place i will be paying all costs involved.

Here is the formula. Its all here and may you have to read it a couple times but just plug in the numbers. ( However, if it’s a company selling, its very easy to figure out, only if the seller is a individual, does it get much more detailed) You can call the Land Dept and get the appraised price.

Specific Business Tax with a flat rate of 3.3% on the selling price

Transfer Fees with a flat rate of 2% of the official appraised price

Stamp Duties with a flat rate of 0.5% of the official appraised price

Income Tax with a flat rate of 1% on the selling price (or official appraised price of the property if it is higher) for a juristic person

or a progressive rate on the selling price ( or official appraised price of the property if it is higher) for a natural person

Income Tax (Withholding Tax)

The above income tax will be imposed on the recipient of taxable income from the sale of real property. This income tax will be withheld by the land office upon the registration for transfer of the land. The recipient can be either natural person or juristic person which are limited companies, limited partnerships, condominium juristic persons, associations and foundation etc.

For the transfer of real property with the Land Office, a seller or owner of the property is expected to pay( unless if you have agreed to do so for them).

Natural Person Taxpayer ( Seller)

A natural person is subject to all taxes prescribed by law. The tax rate will be under the progressive rate as per the schedule under the Revenue Code with a maximum tax of 37%.

In short, personal income tax is payable on the selling price ( or official appraised price of the property if it is higher) at the time of sale, less deductions stipulated by the law.

Unlike the West, the actual cost of acquiring the property is not relevant in most cases.

It is a tax that assumes that after holding a property for eight years or more the seller has made a gain of 100 per cent. The result - the seller pays tax on a gain he has not made - is a tax on a fictitious gain.

After eight years or more the deduction is limited to 50 per cent, which is the same as saying the seller has made a gain of 100 per cent. Hence, the actual cost of the property is not relevant for calculating the withholding tax.

By the way, when the person sells, they can pay the withholding tax and leave it at that – there is no need for them to include the gain in the personal income tax return at the end of the year. A taxpayer that includes the gain in his personal tax return may elect to claim a deduction for the actual cost of the property rather than the standard deduction.

Juristic Person Taxpayer ( Seller)

If the recipient of taxable income is a juristic person, the tax will be calculated with a flat rate of 1%.

How to calculation the Income Tax

If the company is the owner, the tax is 1% of the actual selling price which cannot be lower than the official appraised value.

If the Seller is a natural person, you have to look at the income in the schedule of the progressive rate under the Revenue Code of Thailand :-

not more than 100,000 0%

more than 100,000 - 500,000 10%

more than 500,000 - 1,000,000 20%

more than 1,000,000 - 4,000,000 30%

more than 4,000,000 37%

The method of calculation is like this....

You need to first calculate the amount of tax to be paid under the progressive rate, the gross amount of income will be first deducted by deductible allowance with the percentage according to a number of years the owner owns the land.

1 year 92%

2 years 84%

3 years 77%

4 years 71%

5 years 65%

6 years 60%

7 years 55%

8 years 50%

For example, if they sell the townhouse they own for three years for the price of 4,000,000 baht, you may first deduct the allowance of 71% for the rate of 4 years being 2,840,000 baht. The sales price of 4,000,000 baht deducted by 2,840,000 baht is 1,160,000 baht.

The deducted amount of 1,160,000 baht will be divided by 4 years which has the result of 290,000 Baht.

290,000 baht will be used as the base to calculate the progressive tax rate being :-

0% for the amount not more than 100,000 baht being 0,000 baht

10% for the amount of 190,000 baht being 19,000 baht

The result is 19,000 baht.

The amount of 19,000 baht must be multiplied once again by the number of years the seller owns the townhouse. In this case it was 4 years

The amount of tax to be paid is 76,000 baht.

Specific Business Tax

Specific Business Tax is a flat tax rate of 3.3% on the actual selling price is collected if the seller owned the townhouse not more than 5 years. If the seller is not subject to the Specific Business Tax, the stamp duty of 0.5% will be applied.

Transfer Fees and Stamp Duties

Government fee for the transfer of townhouse of 2% on the official appraised value is collected on the registration of transfer with the land office. The stamp duty of 0.5% is collected if the seller is exempted from Specific Business Tax.( The Seller owned the townhouse more than 5 years)

Capital Gains Tax

The annual corporate income tax for a SME is 15% from the net profits on the first million Baht in net profits, 25% tax from 1 million to 3 million and over 3 million baht in net profits is 30%. A SME is a company with registered capital lower than 5 million Baht.

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