Property Taxes

[moonseeker]

Hi there

 

A friend just showed me a letter from Pattaya City Hall, supposedly, that announces some kind of new property tax for condos & houses.

He called his accountant who confirmed there was some "new" taxes  (property?), possibly retroactive, for privately and company owned houses & condos.

Unfortunately via phone it was not possible to extract details, so maybe the greater TV community has some details before the accountant 

will elaborate next week. Thanks a lot.  MS>

[bbi1]

I've said it before but I'll say it again, another reason why peeps should never own any property in Thailand 

[moonseeker]

Well, taxes are pretty common all over the developed  world and we can not assume that Thailand will stay behind the world-of-taxes forever. My property taxes in FL are higher than a monthly rental here for a great condo.

Still hoping for some feedback from people who know about that new situation :-)  MS>

[tolsti]

it may help if your friend supplies a copy of said notice.

[lopburi3]

Do a Google search of Thailand property tax 2017 - no effect for most people in primary residence as long as they do not rent it out (50 million exemption).

[dabhand]

Maybe connected to this:

 

http://www.ddproperty.com/en/property-news/2016/11/141397/new-land-and-building-tax-takes-effect-in-2017

The cabinet introduced a bill to reform the land and building tax on 7th June 2016. The bill stated that from 2017 onward, all landowners, both natural and juristic person, would be subject to pay property tax.

 

For residences, seems to be limited to 2nd properties with value >50m. No recent articles that I can find.

[moonseeker]

Thank you kindly Lopburi. I will post what is learned next week. It might be something different as individuals are asked to register at City Hall. Let's see...Thx. to all. MS>

[newnative]

Nothing to lose any sleep over.

[lopburi3]

Actually it is a rather important change and will likely make a great deal of difference as people previously have had no motive to sell old homes and land but if they have to start paying a tax on them, as in many countries, this should provide a lot more options for those not as wealthy.

 

But as said, for most people it is not going to be a tax they will need to pay.

[DD13]

Just "Googled" for info....where it says

 

The proposed property tax is 0.1% above 1.5m baht properties

 

So on a 25m baht property valuation  equals  25,000 p.a.   (£500)

 

Reasonable compared to UK

 

Not sure about exemptions though......I will make some enquiries

Edited June 17, 2017 by DD13
Additions

[KittenKong]

14 hours ago, lopburi3 said:

Actually it is a rather important change and will likely make a great deal of difference as people previously have had no motive to sell old homes and land but if they have to start paying a tax on them, as in many countries, this should provide a lot more options for those not as wealthy.

 

About time too.

 

 

7 hours ago, DD13 said:

Reasonable compared to UK

 

They have to start somewhere. The important point about this tax is that it has been imposed at all. Now that it is in place one can expect the very low initial rate to be increased over time.

[ThaiBob]

The tax is minimal and I have no problem with a property tax. Hopefully, it will fund infrastructure projects as in most countries and not the junta’s pocket. If you are a renter and say so what, remember (speaking as a former landlord) that businesses don't pay taxes, it is passed on to consumer. 

[Rimmer]

I believe this tax has been around for a long time it has just not been enforced.

Hue Yai started to enforce it about four years back they now send out a demand note to all houses  in January every year.

They came along and accessed our property for valuation and also back dated the first payment to when the property was built.

They look at the total built up area also any outside buildings even the swimming pool if you have one. We have a very big place on a large plot but the tax is still not more than 5000 baht a year. 

[moonseeker]

18 minutes ago, Rimmer said:

I believe this tax has been around for a long time it has just not been enforced.

Hue Yai started to enforce it about four years back they now send out a demand note to all houses  in January every year.

They came along and accessed our property for valuation and also back dated the first payment to when the property was built.

They look at the total built up area also any outside buildings even the swimming pool if you have one. We have a very big place on a large plot but the tax is still not more than 5000 baht a year. 

Yes, this might fit what we understood from accountant so far. Old law, to be applied retroactive for everybody, houses and condos. Specifically mentioned Pattaya. Maybe some others have even more details. Thank you. MS>

Edited June 18, 2017 by moonseeker

[moonseeker]

Here a limited update:  All companies owning condos, houses, regardless if used by owner or rented to be hit with a12.5% tax, assessed by tax-office? All privately owned condos, houses, less the one occupied by owner, to be taxed at same rate. Just got this from a Swedish fellow who owns a shophouse in company name and supposedly has to pay 10 years back just above 225 K.which adds up at what he told me 12x15'000x12.5%x10 yrs.

No clue how they asses back-taxes to different owners or who collects this, enforces this etc.etc. By now this should be allover the forums????  Hope for better informed people to post soon.  MS>

 

This is second hand info, no clue if it is accurate. Still surprised the papers are not full of any of this!

Edited June 21, 2017 by moonseeker

[moonseeker]

http://www.thailandlawonline.com/article-older-archive/property-tax-land-and-building-tax

 

Guess, that is it. Supposedly will affect every owner and any type of ownership. The big question is: What will be the assessment of individual types of properties?  MS>

[topt]

2 hours ago, moonseeker said:

Here a limited update:  All companies owning condos, houses, regardless if used by owner or rented to be hit with a12.5% tax, assessed by tax-office? All privately owned condos, houses, less the one occupied by owner, to be taxed at same rate. Just got this from a Swedish fellow who owns a shophouse in company name and supposedly has to pay 10 years back just above 225 K.which adds up at what he told me 12x15'000x12.5%x10 yrs.

No clue how they asses back-taxes to different owners or who collects this, enforces this etc.etc. By now this should be allover the forums????  Hope for better informed people to post soon.  MS>

 

This is second hand info, no clue if it is accurate. Still surprised the papers are not full of any of this!

Sorry moonseeker but why 12 x 15,000?

That total figure is hugely different to what Rimmer quoted for what you would have thought would have cost more.

 

If that is going to be a norm then company ownership just got very, very expensive in the short term..........

[KittenKong]

2 hours ago, moonseeker said:

All companies owning condos, houses, regardless if used by owner or rented to be hit with a12.5% tax, assessed by tax-office? All privately owned condos, houses, less the one occupied by owner, to be taxed at same rate.

 

12.5%? That sounds like the rental tax to me. That tax has been around for a while but not many people seem to pay it. I would not be surprised if this tax was applied unilaterally to all residential property owned by companies as apart from renting it out I dont quite see what the companies could be doing with it.

 

OK, some might argue that if the property is being occupied by the owner of the company then he could be paying zero rent, or a very low rent, but the only obvious purpose of that would be to evade/avoid the rental tax. So it is justifiable to apply the tax.

[catman20]

I was told there would be a

3,500 baht tax per bedroom don't know how true this is but it did come from a Thai accountant. 

[catman20]

If these taxes are true it's going to screw the guys in the renal market even more what with the over supply of rental properties avalible.

good luck if that's your only sourse of income.

Edited June 22, 2017 by catman20

[chrissables]

I had notice from Chonburi City Hall that taxes were due last week.

 

According to my lawyer, who admitted he is not 100% sure, for properties registered through a business but if the business is not actually trading, there will be a tax.

 

The tax will be based on what they (somchai) considers what the monthly rent would be, and one months rent per year is to be paid as tax. 

[moonseeker]

11 hours ago, topt said:

Sorry moonseeker but why 12 x 15,000?

That total figure is hugely different to what Rimmer quoted for what you would have thought would have cost more.

 

If that is going to be a norm then company ownership just got very, very expensive in the short term..........

 Good morning

 

Numbers based on case told to me last night by owner of shop-house in Central Pattaya, running  a restaurant and some rooms for rent.

 

12 months x 15'000 (rent value assessed?) x 12.5% (tax) x 10 (years, back-taxed since construction?)

 

I mark with question-marks, as I have not seen written official details, still hoping somebody will be able to post details of how this tax is assessed, what values are for different type of properties: Studios, Condos, Houses, Villas etc. etc., as I think this might be a subject worthy of TV and interesting for many. I am not affected as I live in my foreign registered  condo.

Yes, this would probably be the end of company ownership in general, as often predicted.Regards.  MS>

Edited June 22, 2017 by moonseeker

[dotpoom]

On 17/06/2017 at 2:58 PM, bbi1 said:

I've said it before but I'll say it again, another reason why peeps should never own any property in Thailand 

I don'don't know why you say this (or what a peep is). There are many Expats who come to Thailand to try it out and after living here for some time decide that Thailand is a country they would like to retire to and spend the rest of their day's in. They hitch up with a partner and lead a relatively very happy life.

   In most of their home countries it is the goal of practically every person to own their own home. Why should they give up that principle when they move here. I know one will say that things here change from day to day leading to a lack of security. But people like me are willing to take our chances and take life as it comes particularly as we are coming to the end of our days anyway. I own my own home, I can do as I please with it on a whim. I don't have to ask another person' s permission to hang a picture on my wall. I can change my garden to whatever way I like. I am not at the behest of another. I don't have to be obliged to another for them to sign a form for Immigration. I don't have to pay rent every week. I don't have to allow a landord to "show" my condo to potential buyers. In other words....."I am king of my own castle" for today anyway and seeing as I live one day at a time ....that is forever.

     Above all...I will have something tangable to leave my partner.....a home that we built up together.

[newnative]

51 minutes ago, dotpoom said:

I don'don't know why you say this (or what a peep is). There are many Expats who come to Thailand to try it out and after living here for some time decide that Thailand is a country they would like to retire to and spend the rest of their day's in. They hitch up with a partner and lead a relatively very happy life.

   In most of their home countries it is the goal of practically every person to own their own home. Why should they give up that principle when they move here. I know one will say that things here change from day to day leading to a lack of security. But people like me are willing to take our chances and take life as it comes particularly as we are coming to the end of our days anyway. I own my own home, I can do as I please with it on a whim. I don't have to ask another person' s permission to hang a picture on my wall. I can change my garden to whatever way I like. I am not at the behest of another. I don't have to be obliged to another for them to sign a form for Immigration. I don't have to pay rent every week. I don't have to allow a landord to "show" my condo to potential buyers. In other words....."I am king of my own castle" for today anyway and seeing as I live one day at a time ....that is forever.

     Above all...I will have something tangable to leave my partner.....a home that we built up together.

Very nicely put and I totally agree.  When you reach a certain age you realize that there are only so many years left--why not enjoy them in a condo or house that you own, with your own things that have meaning to you, and with the freedom to make any changes you want.  I'm always happiest living in a space that I own. 

[bazza73]

On 18/06/2017 at 11:23 AM, ThaiBob said:

The tax is minimal and I have no problem with a property tax. Hopefully, it will fund infrastructure projects as in most countries and not the junta’s pocket. If you are a renter and say so what, remember (speaking as a former landlord) that businesses don't pay taxes, it is passed on to consumer. 

Good luck with that. Most landlords in Chiang Mai are begging their good tenants to stay.

[bangkokairportlink]

On 6/17/2017 at 3:28 PM, lopburi3 said:

Do a Google search of Thailand property tax 2017 - no effect for most people in primary residence as long as they do not rent it out (50 million exemption).

 

And if you rent you just do not declare anything like most people do.

 

Someone need to be insane to pay any tax in this country.

 

 

[mran66]

wonder if anybody have any further updates or info on this topic - just got back to Thailand after summer

at home, and had a letter in the box which I think is the similar as OP mentioned. Presumably would

need to go to city hall to settle some tax issue, amount of tax no clear. I have a small house in company name,

never got anything like this before.

 

Wondering what is the best/most practical way to deal with this (for a non-thai speaker) - show up in office

and hope not to get demanded farang tax, or to have accountant/lawyer go on behalf? Wondering if this something

that is clear, or something that small envelopes make more favourable?

 

I would guess I am not the only one with this so would be good to share best practices to deal with the topic.

 

[JoePai]

25 minutes ago, mran66 said:

wonder if anybody have any further updates or info on this topic - just got back to Thailand after summer

at home, and had a letter in the box which I think is the similar as OP mentioned. Presumably would

need to go to city hall to settle some tax issue, amount of tax no clear. I have a small house in company name,

never got anything like this before.

 

Wondering what is the best/most practical way to deal with this (for a non-thai speaker) - show up in office

and hope not to get demanded farang tax, or to have accountant/lawyer go on behalf? Wondering if this something

that is clear, or something that small envelopes make more favourable?

 

I would guess I am not the only one with this so would be good to share best practices to deal with the topic.

 

Ask your Accountant who does your annual returns what it is - and should they deal with it for you.

[chrissables]

2 hours ago, JoePai said:

Ask your Accountant who does your annual returns what it is - and should they deal with it for you.

I had my one in August, i was concerned what would happen. I gave my lawyer the tax letter.

 

My bill from him was his fee + "specific business tax" 440 Baht. Last year 576 baht! 

 

According to him initially they were going to tax what they considered you would pay in rent for one month. So maybe they meant one months rent (for example) 20k. Tax on the 20k rather than 20k tax.

 

I really don't know, saw the bill and left, maybe next year it will change.

[mran66]

update  on the topic, just for sharing: went to my accountant today to ask about the issue. Lady on front desk looked at the paper, took phone and made a call (to city hall I guess). After some 15min of talking she told I would need to pay property tax for land and house at rate of 10500 Bt per year retroactively starting from 2013 + 200bt penalty of late payment. She said the tax assesment is made based on documents provided to city hall for building permit, whatever those have been. 

 

Also, she told this is something that city hall enforces on 'lottery' basis annually to meet the quota on tax collection. More activation lately as 'they need money to make the city beaufiful' as she said...So not everyone gets it, but when will, will have retroactive collection if not paid. So kind of small lottery with negative reward!

 

I also asked what happens if not pay it - seems not very clear but presumably nothing much other than you just get another

win later with bigger amount to pay as longer dues. They not aware of any major penalties, but who knows.

 

Tax itself is actually quite a bit taking into consideration my house is a small townhouse type one on small piece of land (more floor space than land). At home my property tax would be less for similar property i think, though maybe same magnitude.

 

She said she also need to pay 5000 per year for her own house (small townhouse), and she said this has nothing to do with my house being in company name, but again, who knows.

 

Just one of those small surprising things that you dont really like...but guess can only blame myself as not figure out existence of this before. Was not aware at all that his kind of tax exist in Thailand.

 

Anyway, 10500 per year is not bad at all as otherwise taxation works very favourably for me. Just wish the money would go to

making the city more beautiful - wishful thinking I know, it won't

 

Those who never heard, be prepared...