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Taxes and Fees When Buying Real Estate in Thailand

Taxes and fees for a real estate transaction in Thailand are much lower than in Europe. To give you an idea, they represent approximately 5 to 7% of the selling price for a resale property.

A Bilateral Agreement with France

These relationships are supported by an agreement signed on 27 December 1974 that describes how the double taxation arrangement works between the two countries. This agreement stipulates that: “Income from immovable property may be taxed in the Contracting State in which such property is situated” (Article 6.1 of the Convention).

Therefore, when purchasing real estate on Thai soil, Thai taxation will apply instead of French taxation and no double taxation will occur for the purchase. In addition, any rental income generated by these same properties will also be subject to taxation of the place where it is located, namely Thailand, without additionally applying French taxation.

Property Taxes More Advantageous

Here are the details of these different taxes applicable in Thailand. You will also find a brief summary table of all these taxes at the end of the article:

  • The Transfer Fee: These fees are paid to the Land Department, which is the equivalent of the Land Registry in France, in order to proceed with the transfer of property ownership. Its amount is 2% of the estimated price of the property by the government and not the selling price.
  • The Business Tax: This tax of 3% of the estimated price of the property by the government is due in case the property is resold within 5 years after its purchase.
  • Stamp Duty: These duties amount to 0.5% of the sale price and are paid to the land registry.
  • Income Tax: Unlike the French tax of the same name, it does not really tax the capital gain on the property when resold but follows a method of calculation taking into account the estimated value of the property, its holding period, and a deduction table based on the depreciation of the property.

In practice, all of these taxes will generally be included directly in the sale price of the property with the exception of half of the transfer fee which will be payable by the buyer in addition, ie 1% of the estimated price. Also, note that the agency commission is the responsibility of the seller only.

Western Taxation vs Thai Taxation

 Unlike some Western Countries, the Thai law does not implement property tax or housing tax.  

In the case of an estate you will not be subject to the payment of inheritance tax. Indeed, only the assets of more than 100 million THB (2,674,000 €) are likely to be taxed.

Comparative Costs

Here is a comparative table of the total costs (taxes, fees, and associated costs) generated by a real estate purchase in some Asian and Western countries. Thailand remains among the least expensive countries:

Thailand Indonesia Hong Kong Japan India USA Canada France
5%-7% 16– 17% 22-45% 13-13% 8.-15% 8.-11% 11-22.4% 7.9-29%

You can find a more detailed version of this article on the website of our real estate agency by clicking here.