Under declaring in the Land Office

[baywatch82]

I know under declaring is a common practice in Thailand when selling the property to reduce taxes fees.
I bought a few condominiums and the owner/agent always under declared the value, but now I am at the point where I will be selling for the first time.
My client is Japanese and he is very concerned about this practice.
He is buying a condo for 3.2mln baht, but I want to declare 1.5mln at the Land Office. It was declared 1.3mln when I bought it 3 years ago.

What is the procedure for doing that ?
I assume the sell/purchase agreement between me and my client is just for us, and we don't give in to the Land Office officer, so the sell price in this contract will be 3.2mln.
In the Land Office during the transfer process we will be asked the selling price, and then we will declare 1.5mln. Also my client's currency trasfer certificat should be for 1.5 mln. Is that right ?

Edited July 1, 2016 by baywatch82

[bangkoklawyer24]

You should not worry about that. It is no problem at all for you. All the disadvantages are on the Japanese side. Go ahead!

1. A condo unit purchase agreement has to be in writing. Writing means the important data has to be in the document. With a wrong purchase price, the transfer is invalid, even if it is registered at the land office. The Jap will find out later :-)

2. There are now 2.9 million baht untaxed reserves in the condo unit. This hidden tax burden is transferred to the Japanese. He can pay this later. :-)

3. In case of any issues with the purchase contract, just terminate it and give him back his 1.5. You can keep the difference in your pockets. :-)

4. .......

[smutcakes]

Japanese always want to do this correctly, and rightly so. If you are desperate to sell, and you are unlikely to be able to find a new purchaser, i would suggest doing it correctly with this Japanese buyer is the correct way to go.

Otherwise find a new buyer if saving a few baht is that important to you.

[baywatch82]

I have explained to Japanese, that if we declare the correct amount 3.2 mln baht, not only we have to pay higher taxes 50/50 (which will make us pay 50k baht more each, so not just couple of baht), but also in the future, when he wants to sell it, he will be not able to declare less than 3.2 mln anymore. That may turn away potential buyer (especially thai), because of high taxes, or he will have to take the costs on himself.

He agreed that we should proceed with under declaring as a common practice,
I am just wondering about a 'correct' process of doing so.

Edited July 1, 2016 by baywatch82

[seedy]

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