Have to pay 6% extra tax when selling condo if you don't live in it?

[maanoi]

So I have a condo in my name in Phuket that I want to sell as I currently live in Chiangmai.

I called my condo's office as they also handle rentals and sales for the building. They said that since my name was "not on the condo" I would have to pay an extra 6% tax when transferring the condo to a new owner. I'm a little bit confused here. The condo is indeed in my name (payed in full), however I have never actually lived in it. I have the chanote and some little blue book thing with my name....

I've searched around online and cannot find any info on this extra 6% tax.

As far as I can find I am in for the below tax.

1% Withholding Tax
2% Transfer Fee (split with buyer)
3.3% Specific Business Tax

+ capital gains tax.

So the standard tax equals 6.3% tax (5.3% if buyer/seller split the transfer fee). Do you think this is what she was meaning?

She seemed to stress that it would be an extra 6% on top of regular tax because I don't have my address set as this condo (what ever that means). She also said I could come to Phuket and move my name into the condos address to avoid this 6% tax.

Can anyone shed some light on this?

EDIT:

I assume I don't have to pay the 3.3% business tax??

Edited June 22, 2014 by maanoi

[Langsuan Man]

It might be the income tax that you will owe if you sell it at a profit

But I still don't understand the bit about not having your address set as the condo

Edited June 22, 2014 by Langsuan Man

[yankee99]

the total fee is about 6%. Just go to the land office and they will tell you what to pay

[maanoi]

It might be the income tax that you will owe if you sell it at a profit

But I still don't understand the bit about not having your address set as the condo

Yeah I expect to pay some income tax thats no problem. Just have no idea what she is talking about re having my address set at the condo.

[maanoi]

In Thailand do you pay capital gains tax on the property you live in?

[Thai Travel Bug]

Total should be around 6% and there is no capital gains tax in Thailand.

[thailand49]

It could will be a communication problem. You might not pay it yearly but there is actually a property tax here in Thailand. It is so small that they do not bother to collect it but do when a sale happens?

Just responding on what you posted! If you are being charged for not living in the condo it is because you might have on record with the office since they handle sales and rental that you do not actually live in the unit and have been renting it out. If this is in fact the case.. go to the office change all utilities to your name make it look like your are now living in the unit to get around the tax or fee.

Last, something for you in the future... Get out your copy of the condo By-Laws and read?? if needed translate it! your answer should be inside!

[rockdude]

Regarding to Specific Business Tax, if you have registered your name in Blue Book (Registration House Book) for 1 year or you have hold this property for 5 years, you don't have to pay this tax. You have to pay Stamp Duty (0.5%) instead. Otherwise the tax will deduct expense by year occupied.

[RuamRudy]

Regarding to Specific Business Tax, if you have registered your name in Blue Book (Registration House Book) for 1 year or you have hold this property for 5 years, you don't have to pay this tax. You have to pay Stamp Duty (0.5%) instead. Otherwise the tax will deduct expense by year occupied.

So as long as my name is in the blue book for at least 1 year, I can sell a condo within 5 years of buying it and not pay the SBT?

[yankee99]

Unless you are thai your name will never be in the blue book!!!!

I dont understand why the sales agent is involved in taxes. Like i said previously just make your deal go to land office and they'll tell you the fees which will be about 6%. Ive done plenty of these and thats what it is.

[khunano]

Unless you are thai your name will never be in the blue book!!!!

I dont understand why the sales agent is involved in taxes. Like i said previously just make your deal go to land office and they'll tell you the fees which will be about 6%. Ive done plenty of these and thats what it is.

...or a foreigner holding a residence permit than you will also be registered in a blue book!! Otherwise it is indeed for Thais only, as a foreigner you may apply for a yellow book though.

[maanoi]

So im in for around 6% tax + capital gains tax (if any). I'll just ignore what this lady was going on about.

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[Nobbie49]

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Oh yes there is if sold within 5 years of acquisition.

Total should be around 6% and there is no capital gains tax in Thailand.

[travelono]

Regarding the empty condo. Not knowing how long empty, but I will tell you what I learned a while back when considering owning.

I read there is a tax, also not for capital gains, but for the government to collect if a condo is empty, the condo will be considered a rental for the purpose of taxation even if there is not tenant.. The rent amount is estimated, even if not rented, and tax on the amount charged. That is only if you live somewhere else.

If I find the link to that info again I will post it.

[belg]

short option, don't sell... rent it out for life

[travelono]

I am faced with this too...own an option to buy a condo...have to pay it off at end of July. If I take possession, and sell later have to pay tax. If I sell now before it is finished, just take profit. I hate being a landlord. But maybe better than paying taxes. Too hot for me up in Khon Kaen. So it will be for sale now. No market since politics ran things down. Good luck about the tax problems.

[attrayant]

I called my condo's office as they also handle rentals and sales for the building.

How can a small business (which is essentially what a condo association is) insert itself into a private arrangement like real estate sales? Unless it's mandated by a condominium act, what gives them authorization to levy state taxes and impose conditions on sales? Is this actually written into your bylaws? Do they handle title transfer and do all the document work for you too?

What would happen if you and a buyer went to the deed office and completed the sale and title transfer between the two of you? How would the condo association even know? I would never pay taxes to a middleman in Thailand*. Pay them directly to whichever government bureau requires them.

*supermarket sales tax being an exception, of course.

[Naam]

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Oh yes there is if sold within 5 years of acquisition.

Total should be around 6% and there is no capital gains tax in Thailand.

please stop spreading repeatedly incorrect information because capital gains tax on profits when selling immobile property does exist!

CAPITAL GAINS

Capital gains derived from the sale of immovable property are taxed at the standard income tax rates. The capital gains can either be included in the aggregate income or taxed separately.

If the gains are taxed separately, the tax liability is subject to a special computation and the maximum tax rate applicable is 20%.

The taxable gains earned from selling a Thai property are computed as the selling price or the market value of the property less some deductions. The deductions are percentages of the gross amount, and these percentages depend on how long the property was held before the sale or the transfer.

STANDARD DEDUCTION

FOR CAPITAL GAINS HOLDING PERIOD DEDUCTIBLE EXPENSES 1 year 92% 2 years 84% 3 years 77% 4 years 71% 5 years 65% 6 years 60% 7 years 55% 8 or more years 50%

http://www.globalpropertyguide.com/Asia/Thailand/Taxes-and-Costs

[maanoi]

I called my condo's office as they also handle rentals and sales for the building.

How can a small business (which is essentially what a condo association is) insert itself into a private arrangement like real estate sales? Unless it's mandated by a condominium act, what gives them authorization to levy state taxes and impose conditions on sales? Is this actually written into your bylaws? Do they handle title transfer and do all the document work for you too?

What would happen if you and a buyer went to the deed office and completed the sale and title transfer between the two of you? How would the condo association even know? I would never pay taxes to a middleman in Thailand*. Pay them directly to whichever government bureau requires them.

*supermarket sales tax being an exception, of course.

Sorry if I wasn't clear. The condo is not taking the tax. They are just advising of land office taxes. I don't need to use them to complete the sale. And of course all taxes will be paid directly to the govt office.

In my op I was saying that I just called them for information as I knew they also dealt with sales.

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[BEVUP]

_{To my knowledge as me & wife are paying of house in Moo Baan & the house is still in Company name till fully paid for, is that it is a 50/50 split of all taxes to local government}

[Lazy Sod]

So if somebody has never registered in the blue book it doesn't make any difference to the tax providing you sell after 5 years?

[chris2004]

In another thread they talk about a sliding scale for the withholding tax (rather than a flat 1%) which seems to generate some very big figures. The example quoted gives total selling costs of 2.1 million baht on a 10 million baht property which sounds crazy.