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The Thai government's tax stimulus package for the
property sector is due to expire on 28 March 2010. Property transfers
after this date will attract higher transfer and registration fees.
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Special Business Tax
SBT to increase from 0.11% to 3.3%
Special business tax ("SBT") is
payable by individuals on the sale of property within five years of
the date of initial acquisition and by corporate entities
irrespective of the period of ownership.
Presently SBT is imposed on the sale price of immovable property at
a reduced rate of 0.11%, however, SBT at the rate of 3.3 % will
apply to sales registered after 28 March 2010.
Application of reduced rate
The reduced rate applies to real property
transactions falling under the definition of "sale" under the SBT
chapter of the Thai Revenue Code, including agreements to sell,
sales with rights of redemption, exchange, gift, letting out on
hire-purchase, and disposals or transfers whether or not for
consideration.
The reduced rate presently applies to any
type of immovable assets, including a condominium and/or condominium
unit(s).
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Transfer registration fees
Transfer registration fees to increase from
0.01% to 2%
Presently, reduced registration fees of 0.01% apply to the
registration of mortgages of immovable property transfers, however
transfers registered after 28 March 2010 will be subject to transfer
fees of 2%.
Application of reduced rate
The reduced transfer registration fee applies to sales (including
sales in accordance with a Court ruling) and auctions by the Legal
Execution Department. The reduced rate does not apply to the
registration of sales with a right of redemption, transfer of
immovable property for the purpose of repayment of debt or debt
arising from a mortgage.
The reduced transfer rate applies to
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Land, buildings or land with houses,
shophouses, or commercial buildings under the Land Allocation
Act or land allocated by Government or governmental
organizations which have authority and duty to allocate land.
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Other houses, shophouses or commercial
buildings individually or together with land of an area not
exceeding 1,600 square metres.
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Condominium units and entire condominium
buildings.
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Office buildings for which a construction
permit or a receipt acknowledging construction has been
obtained.
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Mortgage registration fees
Mortgage
registration fees to increase from 0.01% to 1%
Presently,
reduced transfer fees of 0.01% apply to the registration of
mortgages of immovable property. Mortgage registration fees will be
increased to 1% after 28 March 2010.
Eligible immovable properties
The reduced mortgage rate applies to the same types of properties
that are eligible for reduced transfer registration rates (see
heading 2 above) with one exception – no reduction in mortgage
registration fee applies for office buildings.
This message was sent by Herbert Smith (Thailand) Ltd, 1403
Abdulrahim Place, 990 Rama IV Road, Bangkok 10500, Thailand
Herbert Smith, Gleiss Lutz and Stibbe are three independent firms that have a formal alliance.
© Herbert Smith (Thailand) Ltd 2010 |
