When purchasing or selling a condominium in Thailand, it’s essential to understand the taxes and fees associated with the transaction. These taxes can significantly impact the total cost of ownership or sale proceeds. Below is a guide to the taxes and fees you should expect when buying or selling a condominium in Thailand, followed by an example calculation to give you a clearer picture.

Taxes and Fees When Buying a Condominium in Thailand

1. Transfer Fee:
   • The transfer fee is typically 2% of the government-assessed property value.
   • This fee is usually split between the buyer and the seller, but the arrangement can vary.
2. Specific Business Tax (SBT):
   • SBT applies to sellers and is charged at 3.3% of the selling price or government-assessed value, whichever is higher.
   • This tax is only applicable if the seller has owned the property for less than five years or if the property is part of a business sale.
3. Stamp Duty:
   • If Specific Business Tax does not apply, a stamp duty of 0.5% of the registered sale price or government-assessed value (whichever is higher) must be paid.
   • This is a one-time payment made by the seller.
4. Withholding Tax:
   • Withholding tax applies to both individuals and companies selling the property. For individuals, the rate depends on the property’s assessed value and the duration of ownership.
   • For companies, the withholding tax is 1% of the sale price or government value, whichever is higher.

Taxes and Fees When Selling a Condominium in Thailand

1. Withholding Tax (Personal Income Tax):
   • This tax is based on a progressive rate similar to personal income tax brackets and depends on the assessed value of the property and the duration of ownership. It is calculated by taking into account the number of years the seller has owned the property.
2. Specific Business Tax (if applicable):
   • As mentioned earlier, if the seller has owned the property for less than five years or the sale is considered part of a business, SBT applies at 3.3% of the sale price or assessed value.
3. Stamp Duty (if applicable):
   • If SBT is not applicable, the seller must pay a stamp duty of 0.5%.

Example Calculation of Taxes for Buying and Selling a Condominium in Thailand

Let’s assume the following scenario for a condo purchase and sale:

• Condo Price (sale price): THB 10,000,000
• Government-assessed value: THB 9,500,000
• Years of Ownership: 3 years

1. Taxes for Buying:

• Transfer Fee (2% of assessed value):
  2% x THB 9,500,000 = THB 190,000
  If split between the buyer and the seller, each party pays:
  THB 95,000

2. Taxes for Selling:

• Specific Business Tax (SBT) (3.3% of sale price):
  3.3% x THB 10,000,000 = THB 330,000
• Withholding Tax (Individual Seller):
  Let’s say the seller’s taxable income bracket results in a 10% withholding tax. For 3 years of ownership, we assume the following progressive calculation based on government-assessed value:
  (THB 9,500,000 / 3) x 10% = THB 316,666 (per year)
  Total withholding tax = THB 316,666 x 3 years = THB 950,000

Summary of Costs:

• Buyer’s total tax and fee costs:
  Transfer Fee: THB 95,000
  Total: THB 95,000
• Seller’s total tax and fee costs:
  Specific Business Tax: THB 330,000
  Withholding Tax: THB 950,000
  Total: THB 1,280,000

Conclusion

Understanding the taxes and fees involved in buying and selling condominiums in Thailand is crucial for effective financial planning. For buyers, the primary cost will be the transfer fee, while sellers face a more complex tax structure, including withholding tax, specific business tax, and potentially stamp duty. By having clarity on these costs, you can better prepare for your transaction.