Capital One Hong Kong Limited
Real Estate for life
Delivering Thailand Quality development to HK
Tax for property transaction and property tax in thailand
1. Stamp Duty 印花税
Stamp duty of 0.5% ,only the transaction change by using income tax criteria. If use Special business tax, stamp duty rate is 0.01 %
For new condominium from developer, Stamp duty is 0.01%
2. Transfer fee 过户费
Transfer fees of 2%
3. Income tax and Special business tax所得税及特别营业税
In Thailand, there’s no capital gain tax but we use 2 kinds of tax when purchase or sell the property (use either one)
3.1 Special business tax特别营业税
Business tax of 3.3 % (levied against a vendor who has been in registered possession of the property less than 5 years) is also charged, along with income tax (similar to capital gains tax) at a variable rate.In case for new project development, in Thailand use only special business tax 3.3% but most developer will pay for it
3.2 Income tax所得税
Exemption to use income tax method instead of special business tax for the property hold more than 5 years ( In case that the owner is not in the household registration )
By law, if the owner shows a proof of reside in the property such as household registration that have the owner name in it (foreigner eligible to get a household registration at government office), the owner are eligible to use income tax criteria , not necessary to hold the property more than 5 years , which is lower tax rate than special business tax in calculation
Income tax derived from the sale of immovable property is 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%. ( after deduct percentage of holding period deductible
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 INCOME TAX所得税扣除标准
HOLDING PERIOD DEDUCTIBLE EXPENSES
1 year/ 1年 92%
2 years/ 2年 84%
3 years/ 3年 77%
4 years/ 4 年 71%
5 years/ 5 年 65%
6 years/ 6 年 60%
7 years/ 7 年 55%
8 or more years/ 8年以上 50%
Example of income tax calculation 所得税计算举例
In case of sell property at sell price 3,000,000 THB . and owner hold the property for 2 years with household registration have owner name in it
x tax rate/(税率) 20%
= 96,000 baht(泰铢)
Divide by holding year(除以所持年限) = 2
Income tax when selling(出售时的所得税为) = 48,000 baht(泰铢)
The actual expenses incurred can be deducted, especially if they are higher than the standard deductions stated above, but it must be supported by documents.
The balance from the above computation will be divided by the number of years the property was held, whereby the outcome is taxed at the appropriate tax rate. The resulting tax liability will then be multiplied by the number of years the property was in the taxpayer’s possession to arrive at the final tax liability.
But if the property was acquired as a gift or by inheritance, 50% of the proceeds (selling price or market value) are deductible as expenses. The balance or 50% of the proceeds will be divided by the number of years the property was held, and the outcome taxed at the appropriate tax rate. The resulting average tax liability will then be multiplied by the number of years the property was held to arrive at the final tax liability.
Property Tax 房产税
This is an annual tax levied on land ownership. The amount is often so small that in practice the body charged to collect it rarely bothers to do so. When they do collect it, it is usually after several years when the amount has accumulated.
Structures Usage Tax 结构使用税
This only applies to commercially used properties. The rate is 12.5% on the actual or assessed gross rental value of the property. However, this notional value is well below the commercial market rental value.
If the property is purchased through a company, you need to remember that corporate tax is higher than personal tax, and the cost of setting up the company must be considered as part of the initial investment.
Tax on Rental Income 租赁收入税
This tax is charged at between 10 and 30% of the rental income, depending on the type of property leased.
本税则依据所租赁的房产类型，从租赁收入中征收10% - 30%的税额。
Inheritance Tax 遗产税
No inheritance tax is charged in Thailand for all family members.