Thailand Property & Land Taxes
Whenever a property in Thailand is bought and sold, there are four taxes that need to be taken into account.
The local system of taxing property is based on an arbitrary assessed value as determined by the local Land Department, rather than true market value price. There are no set rules as to who pays for which taxes, and it is just another part of the bargaining process for purchasing property in Thailand
Which of these taxes/fees will be applicable depends on the details of the transaction, the vendor and the duration of the vendor's ownership. It is also significant to note that most of the fees are calculated relative to the governments "tax assessment value" of the property and this value is well below the market value.
If the house is purchased through a company, you need to consider that corporate tax is higher than personal tax, and the cost of setting up the company has to be considered as part of the initial investment, even if this is relatively modest.
If you wish to purchase property in Thailand using Thai Baht, ensure that your funds are transferred to Thailand in foreign currency and converted to Thai Baht here. The receiving bank will issue a Foreign Exchange Transaction Form or Tor Tor 3 confirming the transaction for individual inward transfers exceeding 20,000 US$, which is one of the documents you may need in the future if you wish to repatriate funds without incurring tax penalties.
Repatriation of investment funds and repayment of overseas borrowing in foreign currency can be remitted freely upon submission of supporting evidence. One of these documents would be the Foreign Exchange Transaction Form mentioned above, or in respect of a foreign currency loan and the loan contract. Remittance of funds without proper documentation could be regarded as income and become liable for tax.
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