How Low Are The Fees And Taxes When Purchasing Phuket Real Estate?

2% — calculated on the higher of the assessed value or actual sales price (buyer typically pays, but developer is responsible for 50% on a new build)

one time fee (THB 500/m² — 1,500/m²)

The ongoing cost of condo ownership is also remarkably cheap in Thailand.

• Common Area/Maintenance (CAM) Fees — average THB50/m², higher for luxury condos (payable to the condo management)
• Utilities (e.g. water, electric, gas) — these vary, but are lower than in most other countries

House and Land Tax

If you are living in your property, or if it remains empty for most of the year, you do not need to pay this tax. Typically collected locally, a tax of 12.5% apples to your assessed annual rental income.

If you are renting out your Phuket property, you must also report and pay tax on the rental income. While this may sound ominous to some, the progressive tax rates in Thailand are actually very attractive. In fact, the tax payable on rental income of US$ 1,500 p.m. (US$ 18,000 per year) would actually work out to less than 3%, while the total tax payable on rental income of $144,000 per year would still be less than 15%.

The other conveyance fees, typically paid by the seller, include:

• Application Fee: negligible (circa THB 500)
• Specific Business Tax (SBT): 3.3%*
• Stamp Duty: 0.5%*
• Income Tax: 1% of the appraised value for corporations (marginal income tax rate for individuals)

*Stamp Duty and SBT are mutually exclusive (you pay one or the other)

A business will always pay the SBT + 1% Corporate Income Tax (also called a “withholding tax” because the Land Office withholds it for the tax department). Withholding tax for individuals is their marginal income rate, although the appraised value is reduced the longer you have owned the property, which means less withholding tax.

An individual selling their condo may avoid the SBT, instead paying the 0.5% Stamp Duty, if they have held their property for at least 5 years. The SBT may also be replaced by Stamp Duty if the transfer is to a legitimate child, or if the condo is being passed down as inheritance to a legal heir.

The fees for buying or selling landed property, are for the most part as above. If a company is the seller, the total fees should come to no more than 6.3%. While some developers split these with the buyer, or itemise fees separately, others require the buyer to pay the full amount.

As an owner of the property, the House and Land Tax and income taxes on any rental income (mentioned above) would also apply.