Tax on buying Condo

[sanuk711]

PLEEEEEASE--I didn't want to start a thread, as it seems to wander off on why no one should buy in Thailand, so can we just pass up on that point.

 

I am thinking off buying a condo near Rayon-- the person who owns it (farang--lived in it for over 6 years) his condo management are telling him that the tax to sell is.

2% transfer Fee

0.5% stamp duty

+ 3.3 % SBT  Specific Business Tax

 

From what I have read the SBT should not apply as its a private sale, maybe this has changed in near past----I am reading from a site about condo fees, but maybe its out dated----Could you advise if you have purchased a condo lately. I have rang various real estates --but mixed replies.

 

 

[johng]

Maybe the condo is not in the 49% foreign quota and has had to be bought via the (legally questionable) company method ?

 

 

[sanuk711]

Thanks for the thoughts johng, but no-- it only has a 35% farang ownership so far and the sale (as I mentioned )is from a farang to a farang

 

**BTW I have tried direct contact with BKK land office as no one in Rayone (will) can speak English, can not get anywhere in BKK you just hold until it drops out.

Edited May 5, 2017 by sanuk711

[trogers]

Why are you worried over the tax rates? Buyer only share half of the transfer fees. The rest to be paid by the seller...

 

Read this for explanation:

https://www.phuket.net/property/property-guide/property-taxation/?gclid=COj1wfOZ2NMCFc4WaAodCt0LYA

Edited May 5, 2017 by trogers

[sanuk711]

21 minutes ago, trogers said:

Why are you worried over the tax rates? Buyer only share half of the transfer fees. The rest to be paid by the seller...

I am sorry--I really thought I had explained it. I think the 3.5% BST  is not correct and the sale will not proceed from his point of view.

 

But thank you for your input

[trogers]

4 minutes ago, sanuk711 said:

I am sorry--I really thought I had explained it. I think the 3.5% BST  is not correct and the sale will not proceed from his point of view.

 

But thank you for your input

Specific Business Tax (SBT) is only applicable to a property owned by a company, or owned by an individual who has owned it for less than 5 years.

 

Stamp duty is only applicable when SBT does not apply.

[sanuk711]

Thank you trogers, it is as I thought the management does have it incorrect, I dont know why that should surprise me after living here for so long.

Thank you again

[Sophon]

On 05/05/2017 at 3:05 PM, sanuk711 said:

Thank you trogers, it is as I thought the management does have it incorrect, I dont know why that should surprise me after living here for so long.

Thank you again

I'm not so sure they necessarily got it wrong. From https://www.samuiforsale.com/knowledge/real-property-transfer-taxes-and-fees.html

Quote

If the seller is an individual (not a company) Specific Business Tax does not have to be paid if:

• The seller has possessed the property more than five years before the transfer (the transferred real property has been used as the principal place of residence, and the seller’s name appeared in the house register for not less than one year from the date of acquiring such property).
• The seller transfers the real property to the legal heir or an heir by a will.
• The seller transfers the real property to a legitimate child, but not including an adopted child.
• The seller transfers the real property without consideration to government agencies.
• The seller transfers the real property without consideration to temples, churches or mosques.

So according to the first bullet point it is not enough to have owned the condo for five years, it also have to have served as your principal place of residence. I guess that is so that people buying a condo in order to rent it out, or to profit from price increases are not exempt as both of these purposes are regarded as a form of "business".

 

Since your friend have owned and lived in the condo for more than 6 years, his potential problem is in how he has to prove that. As I read the above, in order to be exempt from the special business tax the owner have to have been registered in the tabien bahn for no less than one year in the period since the property was acquired. So then the question is, does the owner have a yellow tabien bahn (with his name in it) for the condo?

 

Sophon

Edited May 7, 2017 by Sophon

[burgerking]

Hello,

                   I think you will find this useful, make sure you put in all the information correctly, i used this when i bought my condo and it was out by only a few hundred baht.

 

http://www.acuterealty.com/calculator.asp

[sanuk711]

Thaks   got the tips

[dotpoom]

I have always paid on average 6% tax. Never bothered breaking it down.....they told me how much I had to pay so we halved it (buyer and seller). I' m just an ordinary punter.

  The only time I noticed about business tax was when I bought my wife a condo and then bought it from her (long story) within a few weeks. They considered it a " business" deal because it was changing hands so quickly.

  This doesn't obviously apply in your case though.

[skatewash]

Those are the taxes due at the Land Office.  However, the portion of those that you pay is entirely up to you to negotiate with the seller.  It sounds like the seller should qualify for the lower stamp tax (rather than the more expensive business tax --  it's either one or the other).  However, I considered that to be a seller's expense to be borne entirely by the seller.  I agreed to share 50/50 the transfer fee, so I agreed to pay 1% of the assessed value as my share of the transfer fee.  However, it turns out the government had instituted a new policy a couple of weeks before my transfer and the transfer fee was set at 0.01 % (temporarily, to encourage the real estate market).  That fee ended up being so slight that the seller decided to bear it entirely himself ;-)

[bkksiam]

My question is more about selling than buying: If you are a non-resident of Thailand and you sell your condo that has been used for personal purposes only (no rental), do you pay income tax on the profit you made?

[trogers]

39 minutes ago, bkksiam said:

My question is more about selling than buying: If you are a non-resident of Thailand and you sell your condo that has been used for personal purposes only (no rental), do you pay income tax on the profit you made?

Yes. View it as a capital gain tax, and not an income tax.

[KittenKong]

2 hours ago, bkksiam said:

My question is more about selling than buying: If you are a non-resident of Thailand and you sell your condo that has been used for personal purposes only (no rental), do you pay income tax on the profit you made?

 

The tax is payable regardless of whether you sell at a profit or not, and regardless of whether you have earned any rental income from the property or not.

 

So look at it as a retroactive ownership tax rather than an income tax or capital gains tax.

 

If you have been renting the unit out then you should also declare the income and pay tax on it. I suspect that many people here dont do this, which is probably why the government claws some cash back when properties are sold.

[ozmeldo]

I never understood this buyer pays taxes thing in Thailand. Offer what you want to pay and let the seller take it or leave it.

[KittenKong]

3 hours ago, ozmeldo said:

I never understood this buyer pays taxes thing in Thailand.

 

It's scam, just like high asking prices is a scam. Scams are very common here. Advertise your property at a ridiculously high price then offer a big discount. It looks like a bargain but is in fact a scam.

 

Advertise your property with the transfer fees at 50/50. To the uninformed it looks like a fair deal but is in fact a scam.

 

Lies, lies and more lies, all designed to trick the unwary and the honest. The dishonesty fun never ends in Thailand.

[BEVUP]

30 minutes ago, KittenKong said:

 

It's scam, just like high asking prices is a scam. Scams are very common here. Advertise your property at a ridiculously high price then offer a big discount. It looks like a bargain but is in fact a scam.

 

Advertise your property with the transfer fees at 50/50. To the uninformed it looks like a fair deal but is in fact a scam.

 

Lies, lies and more lies, all designed to trick the unwary and the honest. The dishonesty fun never ends in Thailand.

Got it in one but the Thais still go along with it