Personal Income Tax being charged on sale of apartment

[magsandbilly]

Hi
A friend recently got a hefty tax bill on selling his apartment. We are trying to work out how this personal income tax was calculated. On searching the web we find about 4 different answers with there being thousands of bahts different. One way it says you should be paying over thb600,000 another way says it’s thb200,000 yet another way says it calculates to zero! Anyone got the proper Personal Tax calculation on sale price that I can trust?
Thanks a lot

[PET]

Hi
A friend recently got a hefty tax bill on selling his apartment. We are trying to work out how this personal income tax was calculated. On searching the web we find about 4 different answers with there being thousands of bahts different. One way it says you should be paying over thb600,000 another way says it’s thb200,000 yet another way says it calculates to zero! Anyone got the proper Personal Tax calculation on sale price that I can trust?
Thanks a lot

Surely those who have issued the tax bill must provide the calculation!!

[Nereus]

Hi
A friend recently got a hefty tax bill on selling his apartment. We are trying to work out how this personal income tax was calculated. On searching the web we find about 4 different answers with there being thousands of bahts different. One way it says you should be paying over thb600,000 another way says it’s thb200,000 yet another way says it calculates to zero! Anyone got the proper Personal Tax calculation on sale price that I can trust?
Thanks a lot

Surely those who have issued the tax bill must provide the calculation!!

I got hit up for it as well. From what I was to told, it is based on the rental value, and that depends on where the Condo is, for one thing. It is a complete rip off, and just another BS Thai "rule" that is hidden away and up to the local land office.

How can a Farang that has lived in a Condo owned by themselves, used as a residence, be subect to "tax"? I argued that I am not a taxpayer, please show me where my tax file number is! The expected glazed over look, followed by: "if you dont pay it we will not transfer the title".

Added to that, a complete idiot "sales agent" that could not, or WOULD not, insist that the way the contract was drawn up and signed, in was part of the buyers costs!

[magsandbilly]

Tax issuance office don’t speak English

[magsandbilly]

If only they would explain the calculation process!

[malcolminthemiddle]

If only they would explain the calculation process!

Your friend should have received an itemised receipt similar to this example.

Land Department Sign.jpg

(203.92 KiB) Downloaded 3241 times

[STEVE G]

I've no personal experience of this but this website has some explanation of how this tax is calculated:
https://www.sansiri.com/en/news/thai-pr ... -know-286/

[dundrillin]

If the selling price is less than the price you paid for it is tax still payable?

[Nereus]

If the selling price is less than the price you paid for it is tax still payable?

The selling price is not considered, in fact it does not need to be shown to the Land Dept. The tax is calculated on THEIR rental valuation, of the size and location of the property as shown on the Chanote.

That link on STEVE G post refers to business tax and stamp duty, not private property.

[malcolminthemiddle]

If the selling price is less than the price you paid for it is tax still payable?

The selling price is not considered, in fact it does not need to be shown to the Land Dept. The tax is calculated on THEIR rental valuation, of the size and location of the property as shown on the Chanote.

That link on STEVE G post refers to business tax and stamp duty, not private property.

Nereus are you sure you are not describing the annual property tax rather than the taxes due at sale?

IMO the selling/buying prices and any subsequent profit or loss are irrelevant because taxes are based on the land departments valuation.

The LD valuation can be seen in the example receipt posted above where there is no mention of the actual selling or buying or renting prices.

[Nereus]

It has nothing to do with annual property tax, which for Condos has has not been enforced since it was implemented, except for a one time small payment the first year. I had two Condos in Bangkok and only ever paid the one time.

I also never received any annual charge in regard to my house, but as the lawyers handled the sale, and followed the sales contract which stipulated my clear payment, I am not sure what the buyer had to pay.
I certainly did not pay any "tax", but he may have paid it as per the SPA.

What the OP, and myself, had to pay is "income tax", a personal charge, which is charged on the sale and transfer of property.
I have already posted that the "tax" is calculated by the Land Dept., on their valuation of the rental value.

It also has nothing to do with stamp duty and transfer charges, which can be negotiated between seller and buyer, the Land Dept only interested on the amount, not who pays it.

[STEVE G]

That link on STEVE G post refers to business tax and stamp duty, not private property.

As I mentioned above, I have no experience of this but that link mentions how income tax is charged on property sale in schedule A, as well as business tax and stamp duty.
I've absolutely no idea if it's correct!

[Nereus]

This is what everybody has to pay, no exception:

The Thai government imposes a fixed transfer fee of 2% of the sale figure when purchasing or selling a property. This fee is usually shared between the buyer and seller (at 1% each) with responsibility landing on both parties but is negotiable depending on the terms agreed upon. If the property has been owned for equal to or more than five years, a stamp duty of 0.5% is also imposed on the sale.

This is what is being discussed:

When it comes to business tax upon the sale of a property, a levy of 3.3% of the registered sale price or appraised value (whichever is higher) is handed over through the sale. This amount comprises of Specific Business Tax (3%) and local tax (0.3%), which is applicable to the sale of immovable property or real estate in a commercial or profitable manner. It should be noted that this tax is only applicable on the first 5 years after ownership of the property. If the property was acquired through inheritance, this figure is waived regardless of the time period that it was owned for.

The usual ambiguous Thai wording, and the sale price is NOT considered, so how is it calculated:

Property tax upon the sale of a property is payable by sellers based on a withholding tax structure that is calculated progressively based on the sale price or appraisal value (whichever is higher) of the property in question and the duration that the property has been owned for.

Then this. Where is the "income" when it is a persons home?

The withholding tax is essentially calculated using selling price as gross income then deducting expense from Schedule B (shown in table below) to get net income. One then divides net income with years in possession to get yearly net income. One can use net income per year to calculate tax income per year from Schedule A. The final step is to multiply tax income per year with years that the property has been in possession to calculate total Withholding tax.

As I mentioned previously: I (or my Thai daughter in this case) was not charged any "income tax" on the sale of the house in Hua Hin as far as I am aware, and as she was not present and it was all done with lawyers, it SHOULD of been done correctly.

[malcolminthemiddle]

It has nothing to do with annual property tax, which for Condos has has not been enforced since it was implemented, except for a one time small payment the first year. I had two Condos in Bangkok and only ever paid the one time.

I've had a condo in BKK for the past 23 years.

Never paid property tax until a few years ago. Now I get a bill every year. Amount is nominal.

[Nereus]

It has nothing to do with annual property tax, which for Condos has has not been enforced since it was implemented, except for a one time small payment the first year. I had two Condos in Bangkok and only ever paid the one time.

I've had a condo in BKK for the past 23 years.

Never paid property tax until a few years ago. Now I get a bill every year. Amount is nominal.

So have I, two in fact. I only ever received the first bill, which when I went to pay it I was informed that I only had to pay a few baht, not the 700 odd that was showing on the bill! TIT!