Selling land based on the appraised (goverment assessed) land office valuation

[Lomsak]

I am in the process of selling some farm land.

However just been made aware that the land office/ government have earlier this year dramatically increased the properties assessment value for taxation purposes.

( its three time higher than the previous assessed valuation for tax)

This assessed valuation value is nearly double the price I am selling for.

Whilst I appreciate its impact is huge on Withholding tax, should I be selling at a assessed price (per square wah.)

I want to sell at a realistic and achievable price, as I need the funds.

Its not a fire sale, and I can wait many months, but to lose my current interested customer and start afresh at marketing it at this dramatically higher price seems tempting but highly risky.

Key question. Should land in rural location realistically be sold around price assessed

[smutcakes]

When selling farm land just put the value you feel is achievable on it. Under most circumstances the Govt assessed values are under that which you can get selling on the open market, but the sales of farm land comparables are even less transparent than most transactions here.

At least with the Govt assessed value of the land being above what you wanted to sell it for, you can put that price on it and have some kind of justifcation to fall back on. Obviously if it does not sell in a period of time the chances are that it is overpriced. It is very difficult to put a value on pure agricultural land. Perhaps if it is near a town, roads, intersections etc some buyers might put value in a development opportunity.

[Lomsak]

Thanks for the information

I know the area very well, and keep close eye on local prices

So i was confident the current selling price was realistic and in line with other plots that are being, or have been sold.

However the land adjacent was bought about 10 years ago and a luxury house was built. they achieved a very high price when it was sold. maybe the government assessment has taken that into account.

We had naturally put some premium on our selling price based on this but still hugely below the assessed price.

final question. i assume therefore that at any price below the assessed price, we pay the same With holding tax

.

[Paul944]

You probably can complain somewhere if you think the assessed valuation value is too high. You will have to motivate your claim with evidence though. Normally evidence is the selling price of comparable objects. It will not be easy to obtain such information.

The tax is based on the value the land office uses, not the selling price you tell them.

If you are happy with the price your current buyer offers just let him pay the taxes for 100% instead the usual 50/50.

BTW if you happen to sell 1 to 5 rai in Nam Phare, Hang Dong near Chiang Mai. I may be interested.

Edited April 21, 2016 by Paul944

[blackcab]

The tax is based on the value the land office uses, not the selling price you tell them.

The tax is based on the assessed value or the declared value, whichever is greater.