When purchasing property in Thailand, it’s essential to understand the various fees and taxes involved, as well as the typical arrangements for their payment. Here’s a detailed overview:
1. Transfer Fee
- Rate: 2% of the property’s appraised value.
- Details: This fee is imposed by the Land Department and is based on the property’s appraised value, which may differ from the actual purchase price.
- Responsibility: Sometimes it is borne by the buyer, and often both buyer and seller share this fee equally, each paying 1% However, the exact arrangement can be negotiated between the parties.
2. Specific Business Tax (SBT)
- Rate: 3.3% of the property’s appraised value.
- Details: Applicable only if the property is sold within five years of the seller’s ownership. If the property has been owned for more than five years, SBT does not apply, and instead, stamp duty is imposed.
- Responsibility: Paid by the seller
3. Stamp Duty
- Rate: 0.5% of the property’s registered value.
- Details: Imposed when SBT is not applicable, i.e., when the property is sold after five years of ownership.
- Responsibility: Paid by the seller
4. Withholding Tax
- Rate:
- For companies: 1% of the appraised value or the sales price, whichever is higher.
- For individuals: Calculated at progressive rates based on the appraised value, with the Land Office providing the exact calculation.
- Responsibility: Paid by the seller
5. Legal Fees
- Rate: Typically around 1–2% of the property’s purchase price.
- Details: Covers services such as due diligence, contract review, and assistance with the transfer process.
- Responsibility: Usually borne by the buyer, though this can vary based on negotiations.
6. Mortgage Registration Fee
- Rate: 1% of the mortgage amount.
- Details: Applicable when registering a mortgage on the property.
- Responsibility: Paid by the buyer.
7. Real Estate Agent’s Commission
- Rate: Typically 3–5% of the property’s sale price.
- Responsibility: Usually paid by the seller, though this can be negotiated.
Note: The allocation of these fees and taxes can vary based on agreements between the buyer and seller. It’s important to discuss and document these arrangements clearly in the sale contract.
Given that you’re considering purchasing property in Phuket, it’s advisable to consult with a local real estate agent or legal expert. They can provide guidance tailored to the local market and ensure compliance with current regulations.
